By Erin Ailworth and Jon Kamp
Massachusetts officials thought they were close to securing
future supplies of green energy by piping in hydroelectric power
from Canada.
But a week after Massachusetts said yes to the $1.6 billion
project, neighboring New Hampshire said no, jeopardizing the
192-mile transmission line that would bring in the electricity
through the Granite State.
The rejection earlier this month marked the latest example of
how hard it is to build large energy infrastructure in New England,
which is pursuing aggressive renewable power goals and sometimes
strains to meet current, pressing electricity needs.
The six-state region -- where electricity costs are 56% above
the national average -- is heavily dependent on natural gas-fired
power after years of losing older, uneconomic coal, oil and nuclear
plants to retirement. Gas is also in high demand for heating area
homes.
Yet New England sometimes has difficulty importing enough
natural gas to satisfy its needs due to a shortage of pipelines,
including conduits to the cheap natural gas being produced less
than 400 miles away from Boston, in Pennsylvania, where shale
drilling has helped trigger a boom.
"The not-in-my-backyard concept is extraordinarily powerful in
New England," said Chris Lafakis, the head energy economist at
Moody's Analytics.
New England turned to burning oil for electricity during a
two-week winter cold snap around Christmas and New Year's, using
about 2 million barrels -- more than twice the oil burned in all of
2016, according to ISO New England, the organization that runs the
region's power grid. The strain was so acute that the North
American arm of French energy company Engie SA recently brought a
shipment of liquefied natural gas -- including fuel that originated
about 5,000 miles away in Russia -- to Everett, Mass., from
Europe.
ISO New England warned in a February report that without some
new infrastructure, "keeping the lights on in New England will
become an even more tenuous proposition." With more power plants
set to retire in coming years, ISO New England said, the grid is
likely to be at risk of fuel shortages and rolling blackouts.
The region's energy constraints and high costs are an irritant
for business groups such as Associated Industries of Massachusetts,
which represents several thousand businesses. It says those costs
make it harder for companies to compete, putting jobs at risk.
Energy constraints also frustrate some of the area's
politicians, including New Hampshire Gov. Chris Sununu, who opposed
his state's decision to block the power line to Massachusetts,
known as Northern Pass.
The power line defeat "sends a pretty bad message out there that
our process isn't conducive to looking at new ideas," Mr. Sununu, a
Republican, said in a radio interview earlier this month. "You
can't just say no to everything."
New England states have ambitious mandates to meet future
electricity needs with clean energy -- populous Massachusetts wants
40% of its power from clean energy sources by 2030. Those goals
have spurred some renewable energy installations, including dozens
of projects totaling more than a gigawatt of wind-powered
capacity.
But the large-scale energy infrastructure to meet those goals
and increase access to fuel supplies in the region has been a
nonstarter in recent years.
The developers of Cape Wind, an offshore wind farm once planned
off Cape Cod, formally gave up last year after more than a decade
of intense local opposition and legal challenges.
Kinder Morgan Inc. in 2016 abandoned a more than $3 billion
natural-gas pipeline, Northeast Energy Direct, saying it didn't
have enough buy-in from utilities and faced a tough regulatory
environment. The pipeline drew stiff opposition from
environmentalists and communities worried about property values,
potential safety issues and damage to the landscape.
Massachusetts officials hoped to take a big step toward their
green-energy goals with the Northern Pass power line, which would
import enough cheap hydroelectric power from Quebec to light up as
many as 1.1 million homes. Adding a major resource that wasn't gas
was a selling point. "Resources such as hydropower are critical to
us," said Matthew Beaton, the state's energy and environmental
affairs secretary, when the selection was announced last month.
But in woodsy New Hampshire, the idea of turning part of the
state into an extension cord for Massachusetts has long been
controversial. New Hampshire's Site Evaluation Committee voted the
project down this month, citing concerns including a negative
impact on tourism and property values.
Eversource Energy, which proposed the line, is mounting an
appeal, arguing that the committee didn't give the project proper
consideration. "We're going to remind them of their legal
obligation to do so," said Eversource New Hampshire President Bill
Quinlan.
Massachusetts officials have said they are sticking with
Northern Pass for now, but will also start negotiating with the
developers of another project that could bring Canadian hydropower
via a transmission line through Maine, though not as quickly.
Some environmentalists played down concerns that New England
can't get energy projects built. Peter Rothstein, president of the
Northeast Clean Energy Council, said his group supports
infrastructure that leads to cleaner power, like offshore wind,
which he called a huge resource right off the New England
coastline.
"It's not that you can't get something built, it's that you have
to get the process right," he said.
(END) Dow Jones Newswires
February 23, 2018 08:14 ET (13:14 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.