POWERING MAINE

Maine’s electricity system needs improvements for a variety of reasons. Before any work can begin, however, the question of who will pay for it must be answered. To complicate an already complex process, how that question is answered may determine whether Maine should remain part of the New England electricity grid.

Earlier this month, Central Maine Power Co. announced plans to build two new power lines at a cost of nearly $2 billion. One, a 345,000-volt transmission line from Orrington to Newington, N.H., would enhance the reliability of the backbone of Maine’s power system, while also increasing the state’s capacity to both import and export electricity.

The other line, proposed by CMP and Maine Public Service Co., would connect northern Aroostook County with the New England power grid. The County currently is connected only to Canada, which limits its electricity options. In 2006, the Public Utilities Commission rejected bids (both from the same company) to provide residential power to the County because it thought the price was too high.

In considering these projects, the PUC’s top concern must be whether the improvements will benefit Maine ratepayers, both commercial and residential. Part of that determination rests with how the new lines are paid for.

Maine residents and businesses are expected to pay an extra $300 million over the next five years to fund system upgrades in southern New England. As part of ISO-New England, which apportions costs for many infrastructure projects based on the percentage of the region’s energy used in each state, Maine pays 8 percent of the cost of most system upgrades. Maine utility regulators argued that Maine customers should not pay for work that would not benefit them. The federal government disagreed and Maine lawmakers began to consider whether Maine should leave ISO-New England.

Now that the situation is potentially reversed, Massachusetts is balking at the possibility of paying 55 percent of the cost of Maine’s upgrades. This is especially troubling because adding new lines in Maine could increase the supply of electricity, especially wind-generated electricity, to southern New England, a benefit to that area’s consumers.

Part of the opposition stems from concerns that Maine, which has several wind projects on the table, could use up a large share of the region’s renewable energy credits. This could make wind projects in Massachusetts and other New England states less attractive economically. The credits are valuable because they can be sold to other companies allowing them to buy credits rather than reducing their own emissions or generating power from renewable sources under states’ renewable energy requirements.

If the new lines are not built, Maine consumers could face outages and the state would become a less attractive place for renewable energy generation because it would become impossible to ship all the electricity out of the state without new power lines. If Maine businesses and residents are expected to pay the full costs of the lines, however, the projects likely fail the consumer benefit test.

Utilities, electricity generators and renewable energy developers want these new lines for a lot of reasons. Ensuring Maine consumers benefit, through lower electricity prices, is a hurdle they should be required to meet.