Sunday, September 11, 2016

Daniel Webster to the rescue?


"Webster then grabs the stranger and twists his arm behind his back, "for he knew that once you bested anybody like Mr. Scratch in fair fight, his power on you was gone." Webster makes him agree "never to bother Jabez Stone nor his heirs or assigns nor any other New Hampshire man till doomsday!""

https://en.wikipedia.org/wiki/The_Devil_and_Daniel_Webster

I'm watching the 60 Minutes coverage on the earthquakes in Oklahoma on this Sunday, September 11th.  9-11.  The title of the piece is "Earthquake Alley."  It got me to thinking about just how awful the idea of selling Concord Steam to Liberty Utilities is.  All the State, School, City and Commercial buildings in downtown Concord will burn fracked gas instead of taking steam co-generated with bio-mass.  The PUC order for the procedure to approve the sale is DG 16-770 and all documents can be viewed here, https://www.puc.nh.gov/Regulatory/Docketbk/2016/16-770.html

I will grant you that there is an "inversion" problem in Concord, so a biomass plant has to have the proper environmental controls, but surely there are other solutions than converting to fracked gas?  Getting rid of that smog here by burning fracked gas will just contribute to people with poisoned water and air who live in the fracking fields and the paths of these pipelines.   We are creating virtual "Hells" in areas of Oklahoma and Pennsylvania.  At least we can see the smog!  We can't see the methane and the formaldehyde and other poisonous gases that will be released into neighborhoods where the metering and regulation and compressor stations are built.

Perhaps it sounds melodramatic to argue that selling Concord Steam to Liberty Utilities is like selling New Hampshire's soul and future to the devil?  But, of all places to sell out to fracked gas; the State Capital!!!  Where is the innovation?  Where is the environmental concern?  Any large city or campus converting from biomass to fracked gas would be bad enough, but the State Capital should be a flagship for a renewable future!

New Hampshire had her own "Daniel Websters" at the adjudicative hearing of the sale of Concord Steam to Liberty Utilities on Friday, September 9th.  Both Office of Consumer Advocate, Don Kreis, and Attorney Richard Husband of Litchfield, pleaded to conduct a fully transparent process.

Attorney Richard Husband, in particular, complained of the lack of discovery which would allow a more thorough investigation of alternatives and answer questions about procedure.  The sale is being fast tracked, yet the filing was not described as an emergency.   

I do not mean to characterize the PUC as "Old Scratch."  They are following the rules which not only gives them the discretion to treat this contract as an "emergency," but encourages them to do so.

I inserted myself into a small group that was poring over a blueprint of the steam lines in Concord during a break in the hearing.  I heard one of them discuss the loop of steam pipes that will still be used, but cut off from the rest of the network and fitted out with a gas fired boiler.  Someone asked where the boiler would go.  Another replied, "In front of the State House!" and laughed.  Before I could stop myself, I retorted, "Yes.  It should.  As a symbol of our shame!"  Before anyone gets too excited, they actually pointed out an area well away from the State House where the boiler will go.

Still, it gave me an idea.  If I were a cartoonist, I would draw the front of the State House with Daniel Webster now standing atop a huge nasty boiler with a line feeding it that tracked back to scenes of environmental devastation and choking, gasping people.

I'd planned to write another comment on PUC Docket DG 16-770, refuting the numbers offered by PUC staff describing gas prices as $0.95 per Therm versus $5.00 per Therm for Concord Steam.  $0.95 per therm might be the price for the day, but what is the 5 year average?  I did find that the price over the last five years has been closer to $2.00 per Therm.  https://www.eia.gov/dnav/ng/hist/n3010nh3m.htm
I didn't have any luck getting the five year average price for Concord Steam customers, but the fact of having the steam delivered instead of having to operate and maintain a boiler needs some value attached to the price per Therm.  To me, that is another reason for there to be a formal discovery process.

Liberty officials argued that bringing fracked gas to the downtown would increase energy diversity and argued that they are supported by this in the 10 Year State Energy Strategy.  In fact, no diversity is created at all!  Customers in Concord will now have gas, but they won't have the option of steam anymore.  Moreover, the customer list is being sold to Liberty Utilities in exchange for $1.9 Million!  Who else will have access to that list?  Solar installers?  Energy Efficiency and heat pump vendors?  Worse, a renewable biomass producer will go dark; sending New Hampshire in the wrong direction for getting to 25% renewable energy by 2025. 

At least "Old Scratch" agreed to Daniel Webster's plea for a Fair Trial.  Why won't our PUC allow time for discovery and full participation by The Jordan Institute and the people of New Hampshire, like Attorney Husband, who are qualified and have a significant interest in the outcome?

The OCA's argument that The Jordan Institute be allowed to intervene based on statute like the Energy Efficiency Resource Standard (EERS) was rebuffed on the basis that it wasn't yet in effect.  Attorney Kreis also referenced RSA 378:7 that requires all energy infrastructure projects to consider the impact of energy efficiency first,



Unfortunately, the Commission argued that the RSA does not apply to the sale of Concord Steam and referenced legislation (that did not pass) which would prohibit the PUC from considering carbon emissions or Climate Change in their deliberations.

Daniel Webster succeeded, not by law, but by evoking the goodness of the "undead" who served on the jury, their willingness to try, even if they weren't perfect, and the sweetness of life despite hard circumstances.  People have a chance to send in their comments until Friday, September 16th.   Let the weight of our words inspire the interveners to the docket to choose a different path.

Comments may be sent to Executive Director Debra Howland at executive.director@puc.nh.gov
Debra Howland, Executive Director
NH Public Utilities Commission
21 South Fruit Street, Suite 10,
Concord, N.H. 03301-2429
and reference Liberty Utilities (LU) Docket DG 16-770 Petition to Purchase Concord
Steam


Sunday, June 5, 2016

What can we learn from the failure of HB 1660?

HB 1660 was a modest proposition.  It stipulated that if a pipeline company planned to take a portion of your land that was within 250 feet of your residence, you could insist they buy you out for fair market value and cover relocation expenses.  If you didn't like the appraised value they offered on any taking, you could hire your own appraiser at the pipeline company's expense. 

Of course, this wouldn't help abutters whose residences may be even closer.  And, truthfully, 250 feet isn't much comfort with the incineration zone for a 30 inch, 1400 psi pipeline having a radius of 1000 feet.  In case the name doesn't make it obvious; an incineration zone describes an area that will reach temperatures so high everything in it's radius will be cremated.  

State law for eminent domain takings by utilities offer a more generous solution, "Attempts to even enter a property for surveying require 30-day prior notification, and successful seizures of residential property require the owner receive “reasonable relocation and housing replacement costs.”" from http://www.pressherald.com/2012/03/06/n_h_-eminent-domain-rules-tightened_2012-03-06/

As the bill's sponsors pointed out, pipeline companies claim that a buried pipeline does not have a negative impact on property values.  If that is the case, then it should be no problem to buy out a homeowner and resell the property to people who don't mind living with a pipeline.

For residents of Southern New Hampshire, passage of HB 1660 would provide a small measure of comfort after the trauma they've been facing for the last 18 months.

That didn't happen.

While many House members were focused on protecting property owners by mitigating the harms that would be done through eminent domain takings, the Senate took a different approach.

 My next project will be to study the legislative history of RGGI in New Hampshire.  RGGI funds come from a carbon tax on power generators who sell into the ISO-NE market.  Currently, they pay about $5/Ton of carbon they produce.  The money is intended to be used to mitigate and reduce carbon emissions.

In New Hampshire, under current law, all the money except the first $1/Ton is rebated back to electric customers on a per kWh basis.  The total funds available for rebate amounts to about $1.70 per month for an average residential customer.  A large manufacturer could see thousands of dollars in rebates each month. 

SB 492 was also a modest proposal.  It would have increased the amount of funding for weatherizing low income residential homes to 35% of revenues instead of the current 20%.  It would also increase the funding for municipal and school district energy projects from $2 to $5 million, annually.

The Business Industry Association and BAE Systems, who normally testify against anything related to energy efficiency and RGGI, supported SB 492 because although it increased funding from RGGI proceeds for the residential market, it rebated all RGGI contributions for the Commercial and Industrial ratepayers.  So those large manufacturers would get thousands of dollars in rebates each month, but would not have access to funding and programs that support energy efficiency and renewable energy.

The three targets for RGGI funding and programs would benefit all ratepayers and taxpayers in the State. 

The low income weatherization program is just plain common sense.  Residents who qualify for fuel assistance would get help reducing their energy usage through energy audits and weatherization/efficiency projects.  Doesn't it make sense to ensure that the energy dollars we are spending on those homes are being used efficiently?   There are currently 10,000 low income homes on a waiting list for weatherization.  Current funding only allows for about 400 homes per year to be weatherized.   We could be addressing 2000 homes per year if we fully invested RGGI funds as they were intended.  Think of the relief we could offer to struggling families! 

The municipal and school district funding would make pots of money available to reduce the cost to local residents for energy efficiency and renewable projects on municipal and school district buildings.  These funds seldom cover the entire cost of a project; they just provide grants to help make it more affordable.  The big need for funds for schools and towns is that they don't pay federal taxes and therefore can't benefit from tax credits. 

SB 492 was the perfect bill for the House to pass on RGGI.  It was fair to all ratepayers.  It made the BIA and BAE Systems happy.  It would have demonstrated "reasonableness" on energy issues.  If we're going to prevent pipelines; we have to support other approaches to reducing energy costs. 

But SB 492 wasn't a perfect bill.  First of all, I would be very surprised if most Business Industry Association (BIA) members agree with the positions against renewable energy and energy efficiency the BIA takes in the name of its members.  Who is paying for the Energize NH campaign?  Local Chambers might not be very happy to find their membership dollars being spent to lobby against fair deals for net metering that may help them hold down the bottom line on energy expenses.  But, I suspect the funding actually comes from the American Petroleum Institute and America's Natural Gas Alliance.  (They paid for the "La Capra" Study that the utilities and BIA quote from at all the legislative and PUC hearings.)

Moreover, RGGI is currently in the review process and the NH PUC is establishing an Energy Efficiency Renewable Standard (EERS).  There may be needed legislative changes as a result of these procedures in the next Session. 

I wish that the Senate, with eight members on the way out, had found it in their hearts to pass HB 1660 and extract a promise of cooperation from the House on RGGI in the next session.  Allowing SB 492 to pass would have looked like an "olive branch" from the House.  Both Chambers failed us. 

We need Chamber members across the state to start talking about positions on Net Metering and RGGI.  Does the BIA really reflect your will? 

We need House members to fully embrace RGGI and stop messing about with the Renewable Energy Fund.  Review years are actually written into the legislation.  Don't muck about with the rules in between those periods.  It makes it extremely difficult for energy companies to write proposals or business plans when the rules and funding keep changing. 

Make sure your Representatives KNOW you support RGGI and the Renewable Energy Fund.  Ask them about it as they start campaigning this summer.  Call BS on them if they start talking about "redistribution of wealth."  The RGGI fund is a perfect example of capitalism.  We, the people, invest the capital from RGGI in projects to reduce the need for more infrastructure.  Our $1.70/month rebate won't make much difference in our lives, but saving 20% per year on our heating bills will! 








Sunday, May 29, 2016

Memorial Day 2016 - Donald Trump has no sense of shame or honor

Memorial Day is really not about veterans.  By definition, it can't be.  Memorial Day honors the memory of the men and women who died while serving in the US Military.  Those who made the ultimate sacrifice seldom had the chance to become veterans unless they served in more than one war.
I am honestly offended by Trump using "Rolling Thunder" as a political event.  I don't like what he said about illegal immigrants being treated better than our veterans.  Please.
I'm an Air Force veteran.  I went to school on GI Bill and PELL grants.  I only owed $850 when I graduated with a degree in electrical engineering from UNH in 1978.  I use the VA Healthcare system and can attest to its excellence for my care and that of my husband.  Because of the VA, I'm an avid supporter of single payer healthcare.  I am very grateful for the services I've received from my country in return for 6 years of my life. 
My husband volunteered to serve as a Marine during Vietnam.  His relationship with the VA has been more problematic if you consider the first years after he came home from Vietnam.  His PTSD made it impossible for him to sit in a classroom; so the GI Bill was of no use to him.  However, since 2000, the VA acknowledged both the effects of PTSD and Agent Orange exposure and he has some peace at last.
I don't want to minimize the problem of serving our younger veterans of IAVA through the VA.  I DO believe that there are administrative problems, but as someone who has worked in healthcare, I can honestly say that the VA has it together better than a lot of private hospitals/insurance companies.  I continued to use the VA for my healthcare even when I had private insurance to reimburse them.
When my husband was hospitalized at the VA in West Roxbury for surgery last year, I was able to spend the 4 days he was there at the Fisher House.  I could be with him every moment he was awake and simply walk across the street to sleep in a lovely room in the guest house. 
Please, Mr. Trump, you have no concept what it means to be a veteran.  Keep your hands off the VA healthcare system.  We know you want to privatize it.  Anyway you and your friends can get a piece of the action, right? 
By the way, there are many immigrants and first generation sons and daughters of immigrants serving in the military.  One of the most valuable experiences I acquired in the service was the opportunity to live and work with people from Upstate Maine to the barrios of LA.  I feel I got to see the real America.
I know many immigrants (legal or otherwise) who are providing front line healthcare for a growing population of our seniors and people with disabilities.  I've done this work; it is exhausting and doesn't often pay well or come with benefits.  Most people have to work two or more jobs to make ends meet.   We would have a crisis in our healthcare system without people from all over the world who are willing to do this work with gratitude and kindness. 
Most of all,  I find it repugnant that the man who mocked Vietnam POW, Senator John McCain, should hijack the spirit of Rolling Thunder.  "Rolling Thunder is a United States advocacy group that seeks to bring full accountability for prisoners of war and missing in action service members of all U.S. wars. The group's first demonstration was in 1988." from Wikipedia  
So, my fellow citizens, I have no complaint about my treatment as a veteran.  Thank you for all you have done for me and my husband.   Thank you to Senator John McCain for all he suffered on our behalf.  And, most of all, thanks to the men and women who made the ultimate sacrifice...even if it means that a blowhard like Donald Trump can capitalize on it to spew hate against people hanging on by their fingernails.  Despicable!
 

Friday, May 27, 2016

For Jennifer

It's a sleepy Friday afternoon.  I'm listening to a constant barrage of Trump and Sanders speeches in the background.  Spooky, the cat Jennifer gave me, is snuggled up to me on the couch despite the 80 degree heat. 
Jennifer.  One of her dying wishes was that an agency manager promise she wouldn't vote for Trump.
Jennifer wanted to campaign for Bernie Sanders, but it never worked out because of health issues. 
She did come to a "No Pipeline" rally on Central Square in Keene and proudly displayed both Bernie and No Pipeline signs on her lawn. 
I know her spirit is rejoicing that we stopped the NED pipeline, but that she also would want me and my friends to finish the job by making sure we're on a path to a sustainable and renewable energy future.
I miss her.  I think I need therapy to deal with the loss of my friend, but I'm just trying to "ride it out" and keep her in my heart while I continue fighting for the things we both believed in.   Frankly, I am afraid to stop; not just because of emotions that are overwhelming and paralyzing, but because I think I am needed to continue the fight.
I was listening to a program on NHPR about PTSD the other day as I drove home from a demonstration in West Roxbury, Mass.  There are lots of causes for PTSD, but one common phenomenon is that symptoms improve if there's a feeling of being part of something bigger than oneself. 
So, maybe I'm just rationalizing?  Or maybe I'm applying the only relief there is for big losses?
I am glad that I've had the privilege to live almost seven decades on this earth and still feel able to dance when the moment or the music moves me.  Of course, one of the drawbacks to aging is the loss of people you love.  And the older you get, the more frequently it happens.   It is much worse than seeing your body sag or lines spread across your face.  I think a lot about my own mortality and using the time I have left wisely, joyfully, lovingly. 
I need Jennifer.  I need her example, her optimism, her sense of adventure and appreciation of art, music, dance and beauty of every kind.  I deliberately invoke her memory and imagine her reactions.  I cannot close the book on her.  It is only the end of a chapter because I think her story continues on in the people whose lives she changed.

Saturday, March 12, 2016

Compare Wholesale Electricity Prices with Retail Rates 2003 - 2015


 It's a long time since I had to use excel to create a graph, but David Solomon's article of March 9, 2016, inspired me to give it a shot so people could see exactly how low wholesale electric rates have reduced (or not!) our retail rates.  You can read Mr. Solomon's article here,
http://www.unionleader.com/article/20160310/NEWS05/160319975/1028/news05



http://www.unionleader.com/storyimage/UL/20160310/NEWS05/160319975/AR/0/AR-160319975.jpg?q=100





All data is from the eia.gov data browser for electricity in New Hampshire.


Even my primitive skills with converting data to a graphic should reveal that despite falling wholesale electricity prices, the retail rates we pay, continue to climb.  Let's look at a few data points.
In 2003, our wholesale electricity rate was $48.97/MWh (equals 4.89 cents/kWh) and our residential retail rate was 11.98 cents/kWh
In 2005, our wholesale electricity rate was $73.37/MWh (equals 7.34 cents/kWh) and our residential retail rate was 13.51 cents/kWh
By 2012, our wholesale electricity rate had fallen to $28.77/MWh (equals 2.88 cents/kWh), but our residential retail rate still climbed to 16.07 cents/kWh.
In 2015, the wholesale rate was $34.29/MWh (equals 3.43 cents/kWh), yet our residential retail rate reached 18.52 cents/kWh!

While I appreciate Dave Solomon's optimism in his title, "Warmest winter means lower electric rates for consumers," historical data indicates otherwise.
The whole argument for the massive overbuild of pipelines for New England relies on the promise that more availability of cheap natural gas will result in lower wholesale prices and, in turn, lower retail rates for consumers.
Clearly, retail electricity rates do not track/follow wholesale electricity rates!  Moreoever, the pipeline proposal from Eversource proposes to lower wholesale rates by only .8 to a little over 1 cent/kWh against the rates for 2013-2014.
The problem with our high electricity rates is actually rooted in our extraordinarily high transmission and distribution charges, forward capacity payments, and stranded costs from the scrubber on the Merrimack Coal plant.

It's time for the BIA to own up to the fact that their whole EnergizeNH campaign is a fraud! 

Warmest winter means lower electric rates for NH consumers - See more at: http://www.unionleader.com/article/20160310/NEWS05/160319975/1028/news05#sthash.stjaSXb4.dpufWarmest
Warmest winter means lower electric rates for NH consumers - See more at: http://www.unionleader.com/article/20160310/NEWS05/160319975/1028/news05#sthash.stjaSXb4.dpuf

Wednesday, March 9, 2016

Wholesale prices are way down. Where are the savings on our retail rates?



March 4, 2016
Debra A. Howland
 Executive Director
New Hampshire Public Utilities Commission
21 S. Fruit Street, Suite 10
Concord, NH 03301

Dear Ms. Howland,

I’m writing with regard to DE 16-241 and to challenge the misinformation that is being spread regarding our high electricity prices by various groups such as the BIA’s EnergizeNH, Kinder Morgan, and the Coalition to Lower Energy Costs (CLEC) energycostcrisis campaigns.
The following is an ad that appears on sites for online access to magazines and newspapers,

This is, in fact, not true.  Please refer to the eia.gov website and download the 2014 Average Monthly Bill-Residential in table5_a_2014AveBill.pdf.  Actually, the average monthly residential bill is $108.57 in New Hampshire, while in Virginia the average monthly bill for residential customers is $130.04.   If Ms Tewksbury lived in Virginia, her annual electric bill would be $257.64 higher than it is in New Hampshire.  The national average was $114.19 per month.   So, New Hampshire residential customers actually have lower monthly electric bills than the national average and are at least 20% lower than VA. 

It IS true that residential customers in VA pay only 11.10 cents per kWh and NH pays 17.53 cents per kWh, but while a VA household’s average usage is 1172 kWh per month, a NH household only uses 619 kWh!  VA customers may use more electricity because of warmer summers or perhaps it’s because they haven’t invested in energy efficiency and weatherization projects as the RGGI states have. 
There are several examples of these kinds of ads and claims from CLEC and Kinder Morgan.  One claim that is quoted frequently http://ir.kindermorgan.com/press-release/all/new-study-outlines-new-englands-need-additional-natural-gas-capacity-37-billion-co
"New Englanders could have saved approximately $3.7 billion in wholesale electricity costs during the 2013-2014 ‘Polar Vortex’ winter had the proposed Northeast Energy Direct Project (NED) been in service, according to an independent study by ICF International, commissioned by Tennessee Gas Pipeline Company, L.L.C. (TGP), a Kinder Morgan, Inc. (NYSE: KMI) company. The study also concluded that the additional gas capacity that NED would provide could generate $2.1 billion to $2.8 billion in annual savings going forward for New England electric consumers under normal weather conditions."
and later,
"Further analysis by Kinder Morgan finds that the estimated energy cost savings for 2013-2014 would equate to $578 if spread across each of New England’s 6.4 million households, and average $437 per household over the next 10 years assuming normal weather conditions."
The $578 is the number I get when I divide $3.7 Billion by the 6.4 million households.  $437 is what I get if I divide the $2.8 billion mentioned in the first paragraph by 6.4 million households.
There are two MAJOR problems with this.  These numbers are not based on the number of kWhs used.  If you divide those numbers up into market share, residential customers account for only 40% of sales.  So the advertised savings are already less than half their claims.  Instead of $578 and $431; the numbers should be $231 and $174.80 and even the premises for these savings should be suspect.
The second problem is that the $3.7 Billion is for savings on wholesale prices.  "Average households" pay the retail rate which is some multiple of wholesale prices.   
Let’s look at the impact of wholesale electricity prices on retail rates.  The graph below shows data from 4 spreadsheets for wholesale electricity prices from ISO-NE for 2009, 2013, 2015 and 2016. 
New Hampshire wholesale prices are converted to cents/kWh from the ISO-NE spreadsheets
Month-Year
Wholesale All
Wholesale off pk
Wholesale on pk
Retail residential rate (1)
January 2009
7.42 cents/kWh
6.99 cents/kWh
7.94 cents/kWh
16.30 cents/kWh
January 2013
9.42 cents/kWh
8.62 cents/kWh
10.2 cents/kWh
16.33 cents/kWh
January 2015
7.34 cents/kWh
6.59 cents/kWh
8.25 cents/kWh
18.52 cents/kWh
December 2015
2.98 cents/kWh
2.32 cents/kWh
3.72 cents/kWh
18 cents/kWh
January 2016
4.34 cents/kWh
3.76 cents/kWh
5.11 cents/kWh
Not yet available

(1)    Retail prices are from http://www.eia.gov/electricity/data/browser
The Eversource proposal in DE 16-241 claims the ANE pipeline will reduce wholesale prices by somewhere between  0.8 cents and a little over 1 cent per kWh.  These savings are forecast against 2013-2014 wholesale prices.  Yet, milder weather and adding LNG contracts to the Winter Reliability Program have reduced wholesale prices significantly more than those expected from building the ANE pipeline without any evidence of a similar reduction in retail prices.   Moreover, wholesale prices haven’t exceeded 5.62 cents/kWh (peak) since April of 2015.  Where are the savings on our retail rates from the dramatic reductions in wholesale electricity prices?
Please keep in mind that any of these pipeline projects can only reduce wholesale electricity prices with a (hopefully) consequent reduction in the default retail energy supply charges.  The pipelines can’t reduce delivery (transmission or distribution) charges or stranded costs from the coal plant scrubber or the 20 year contract with the Berlin biomass plant.  In fact, according to the Eversource proposal, any tariffs or fees to cover the 20 year capacity contract will be assigned to the delivery portion of the bill. 
In the case of ratepayers who have signed contracts with competitive suppliers (I have a 20 month contract at 8.9 cents/kWh of 100% Green electric supply with Fairpoint), we will see no reduction in the energy supply charge, but will see an increase in the delivery (transmission and distribution) charges from the utility to cover the tariff.
I believe the BIA, the business community, and the general public are being misled about the positive impact that nearly doubling the supply of natural gas into New England will have on electric rates.   Investing in additional energy efficiency, demand response, renewable energy sources, and maintaining supply diversity with dual fuel generation and LNG contracts are all much better ways to address natural gas shortfalls during the winter.   
Despite a number of “open seasons” by the pipeline companies, power generators have failed to contract with them for capacity.  The utilities have no existing mechanism for selling pipeline capacity to power generators.   Yet, we are asked to believe that somehow power generators are going to buy capacity from the utilities.  Today’s price for natural gas was about $1.70/DTH.  The capacity contract would add at least $1.50/DTH to the delivered price.  
We also learn from the Kinder Morgan/TGP objection to Eversource’s request for confidentiality of financial information in DE 16-241 that an Eversource entity has a 40% interest in the Algonquin/Spectra pipeline company.  We already know from IR 15-124 that the parent company of Liberty has a 10% stake in the NED project.  We are being asked to become unwilling and voiceless investors in a new business venture for the utilities. 
The Federal Energy Regulatory Commission is investigating “unfair and unreasonable” transmission charges by the utilities of ISO-NE.  The results of that investigation are due out this month.  If we are going to be concerned about high electricity prices in New England, we should really be examining why our transmission charges are so much higher than the other Regional Transmission Organizations.    The following chart is from a NESCOE presentation about ISO-NE being the last RTO to adopt FERC rules for competitive transmission. 


Why were the high transmission and distribution charges in New England never even mentioned in all the consultant reports on how to reduce electricity prices?   How will the public feel about New Hampshire’s government officials when, after sacrificing their land, safe air and water, and taking on a 20 year contract, our electricity prices go up with the increases in forward capacity payments in 2017 and 2018?  Why, when the utilities in our state are not competitive with other regions for transmission charges, would we bankroll them for a brand new business venture with ratepayer funds?   Why hasn’t the decoupling of the gas and electric utilities proceeded? 
Thank you for the opportunity to comment and ask questions on this important matter.

Pat Martin

Friday, October 23, 2015

Natural Gas: The bridge (fuel) to nowhere for New England

I wrote this back in late June.  So much has changed.  The NH PUC is advising against divestiture of Eversource's generating assets and for imposing a tariff on electric ratepayers to build out natural gas infrastructure.

But, here' how it looked back in June.  The link is a result of the lobbying efforts mentioned below.  http://www.usnews.com/news/articles/2015/09/10/bill-to-reverse-ban-on-us-oil-exports-advances-in-house
And here is a link that lists the status and co-sponsors of SB 1312
https://www.congress.gov/bill/114th-congress/senate-bill/1312/cosponsors

This is NOT a partisan issue.  There's no "liberal" versus "conservative" view.  President Obama is pushing the fossil fuel agenda for increased drilling, fracking, pipelines and export at the same time that he supports the EPA's Clean Power Plan.  Keystone XL is temporarily stopped, but only because of the terrible optics of the tar sands and the devastating spills from their pipelines.  New drilling is being allowed in the arctic on President Obama's watch...even as climate scientists note it is thawing even faster than expected.
On a conference call sponsored by the US Chamber of Commerce, Senator Murkowski of Alaska assured the audience that if Senate Bill 1312 passes both chambers, they expect President Obama's support.  That bill lifts the export ban on crude oil exports which have been in effect since the 1970s.
Among other things, the Chamber claims that exporting crude oil on the world market will lower prices at the gasoline pump.  To whose benefit?  The Energy Information Administration reports that exporting at the levels suggested will raise prices at the pump.  But, the Chamber isn't listening to them. 
Look for a big push on exports over the 4th of July and August recesses.  The Chamber is sending out marching orders to all their member Chambers on how to create a "grassroots" surge in support of exports.  Supporting exports also means supporting pipeline infrastructure. 
The other drumbeat being sounded is "strengthening" foreign policy and providing an alternative to fossil fuels from Russia and/or Iran.  Senator Murkowski calls the lifting of sanctions on Iran's oil exports an affront to American businesses which have had a ban in place for more than 40 years.  She argues that if they lift the ban on Iran, they should lift the ban on American exports. 
In a June 25, 2015 article by Keith Johnson for Foreign Policy Magazine, the dysfunctional nature of relationships between members of the energy sector can be demonstrated in two paragraphs.  Despite the Chamber's arguments that exporting oil will lower energy prices, this first paragraph shows exactly why the industry is dying to ramp up exports.
"The prospect of an end to sanctions, which have targeted Iran’s energy sector and have sharply curtailed oil exports, have raised hopes inside the country and fears without that the long-shunned Persian giant will storm back onto global energy markets. Other oil producers inside OPEC — as well as U.S. oil producers working in the shale patch — fear that quick sanctions relief could unleash a glut of Iranian oil, which would push already low prices down even further."  (Bold and underlined emphasis is mine.)
And, how is this loyalty from the Chamber rewarded by the big oil giants?
" In early June, international firms including Shell, BP, Total, and Eni expressed interest in pouring money into Iran’s oil and gas fields as soon as sanctions are lifted. After meeting Iranian energy officials in Vienna this month, Shell’s boss told Bloomberg that Iran is a “wonderful country with a fantastic resource base”; Total’s chief simply declared, “We like Iran.” Shell has also trekked to Tehran to talk business. Iranian officials themselves are even courting U.S. firms, which unlike their European rivals, have kept Iran at arm’s length so far."
Needless to say, there was no discussion of the impact such exports and enthusiastic extraction will have on climate change during the Chamber conference call.
If we really wanted to help countries like Poland, we would be exporting renewable technology and supporting capital investment in storage and energy efficiency.  That's what would make sense for everyone; except the oil and gas industry, of course.
In New Hampshire, Democratic Representative Howard Moffett (Hills 07) has submitted testimony in support of building natural gas pipeline infrastructure in the NH Public Utilities Commission (PUC) Docket IR 15-124.  He joins three of the four NH utilities, the Business Industry Association, BAE Systems, and the front group for Kinder Morgan, the Coalition to Lower Energy Costs (CLEC).
Have you seen the television commercials pushing the pipeline projects?  The disclosure says it's paid for by CLEC, but Kinder Morgan is a major donor to the organization which formed in November of 2014.
The Kinder Morgan propaganda campaign is in full swing and in addition to running ads, KM is joining all the local and state level chambers of commerce.  They sponsored "The Best of New Hampshire" celebration and "The Granite State Music Festival" this year.
Good.  I hope all this propaganda will make people throughout the State of New Hampshire start paying attention to these projects and what they mean for our future.
The television ad makes two major assertions that are not factual:
1.) Bringing more fracked gas to New England will lower our energy costs
and
2.) We need these plants so that we can shut down the "dirty" nuclear and coal plants.  In other words, natural gas is the "bridge" to some far off future when renewable energy is cost effective.

The first claim to bring cheaper energy to New Hampshire with additional pipeline capacity seems reasonable on its face.  More supply brings lower prices, right?  Should be a "no brainer" until you examine the true situation.

Here are the basics.  NE has pipeline capacity of about 3.4 BCF/day.  Electric generation requires about 1 BCF/day year round.  During the winter months, on about 40 days, for a few hours, heating demand for the pipeline soars to 100% of capacity and this pushes up the price for natural gas for electric generation which is purchased on the "spot market" without long term contracts for reserving capacity. During these times they can use LNG and some have the capability to burn oil as well. 

For eight months out of the year, New England has plenty of pipeline capacity.  Electricity prices during those eight months are as low as natural gas generators can make them.  In fact, during the summer months, the shortfall that requires some oil and coal plants going online comes from not having enough generators.  So, if you think you're going to get electricity for several pennies less per KWH, think again.  All the gas we could possibly use would only help during four months of the year.  Based on the difference between the January and July default utility prices, an average bill in NH during plentiful summer gas capacity will save the average residential customer about $6 on a monthly bill.  So, for example, we could argue that the annual cost to residential customers with default service from Eversource is $36 (since prices are set twice per year) because of constrained pipelines.

One could ask why the electric power generators don't reserve capacity just the way the gas/heating utilities do.  Why aren't they buying pipeline capacity and committing to long term contracts?

The New England Power Generators Association (NEPGA) has argued that the market problem caused by too little generating diversity is already being addressed with the Pay for Performance program and building/converting dual oil/gas generating plants.  They point out that the first BCF/day will produce most of the savings and that projects set to come online in 2016 (AIM and C2C) should address the biggest spikes in price.  They caution the NH PUC to wait for the market to respond before launching into an infrastructure project that will prove burdensome to ratepayers.

So, because NEPGA won't commit to reserving capacity, three of the four utilities and some politicians have decided that the ratepayers should commit to those long term contracts.  Why not?  There's no risk to them and, like the Scrubber on the Merrimack Coal Plant, they make a 10% profit and we pick up any losses.

Here we are, just finishing the settlement agreement for Eversource to divest of all it's generating assets, and we're being asked to pick up new obligations.  The settlement agreement is probably a good idea, but the Large Commercial and Industrial customers will bear a lighter burden of the settlement costs ($100s of Millions) than Small Commercial and Residential customers.  This is in part because there was a lawsuit by business customers over the cost overruns on the Scrubber.