November 07, 2024
Business

Maine eyes Canadian provinces for power transmission coalition

BANGOR – Maine may balk at a federal government directive to become part of a super power-grid system with 11 other Eastern states, and instead form a transmission coalition with several Canadian provinces.

The Federal Energy Regulatory Commission last July ordered Maine and the five other New England states to form a regional transmission organization, or RTO, with New York, Pennsylvania and other states down to the Virginia border.

An RTO, by definition, is a governing board made up of transmission and distribution companies and consumer groups that oversees market conditions, system reliability and price stability issues. FERC, which envisions four RTOs for the entire country, would supervise the formation and practices of any RTO created in the United States.

Maine transmission companies, consumer groups and even officials at the Maine Public Utilities Commission since last summer have questioned the sense of Maine becoming part of an organization primarily made up of heavily populated, power-hungry states south of its border

One concern was that the comfort of knowing that Maine had enough electricity in reserve for heavy consumption days during the summer and winter would be lost. Some of that reserve could be shipped to New York or Pennsylvania.

Anthony Buxton, an attorney representing the Industrial Energy Consumers Group, said Maine, with 1.2 million people, would become “a smaller fish in a bigger pond” of 70 million electricity users whose power needs would get attention first.

“I’m not sure the transmission needs of Maine or New England would be addressed,” Buxton said.

He said that energy-abundant Maine, with five new power generators on line and electricity flowing through it from Canada, would become a superhighway for electricity-starved Southern states without receiving any of the benefits, such as lower and more stable transmission rates.

On Monday, the PUC will begin investigating the pros and cons of becoming part of an RTO that includes the other five New England states, the Maritime Provinces, and possibly Quebec and New York.

That would put Maine right in the middle of any transmission policy discussions not just because of its physical location but because Maine has become the primary link for Canada to sell its power surplus to New England and other states.

Buxton said Maine’s role as that link should not be lost, because other Southern states view it as small or its issues as insignificant in comparison.

Canada’s investment in Maine has been strong in recent years. Emera Inc. purchased Bangor Hydro-Electric Co. for $206 million last October. Emera, too, is a minority stakeholder in the Maritimes & Northeast Pipeline, which runs throughout the state.

And Emera this week announced it may be interested in purchasing the Point Lepreau nuclear power plant, on the Bay of Fundy, which is within 30 miles of Maine’s border, and Coleson Cove generating facility, both from New Brunswick Power.

Emera spokeswoman Alison Gillan said Emera is in a “buying mood” and has been waiting for word from the New Brunswick provincial government as to when it would announce that it was breaking up NB Power and selling some of its facilities.

Stephen Ward, the state’s public advocate, said if Emera buys those two generating facilities, the need for an RTO with Maritime Canada becomes more important. He said Point Lepreau needs millions of dollars in repairs. While that is being done, the province will need power and Maine is the place to get it.

The Maritime Provinces probably will not have a problem becoming part of a New England-Atlantic Canada RTO, said Don Sipe, an attorney and a vice president of a New England RTO formation group. For the last couple of years, Canada has expressed a desire to make the setup of its power markets similar to those in New England states. An invitation to join an RTO with the states would be answered immediately, he said.

“It’s not a matter of us trying to bludgeon them to come to the table,” Sipe said.

Trying to convince FERC to walk away from its initial plan of a 12-state RTO, however, may not be easy. FERC has no jurisdiction in ordering Canada to be included in an RTO, and has no authority to oversee Canadian regulatory policies and analyze how they fit with those in the United States.

Plus, said Buxton, FERC is more interested in the power issues affecting New York and Pennsylvania than the changes in the Maine and Canada markets.

“There’s a fundamental bias coming out of FERC that the power pool should not include Canada,” Buxton said.


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