Portsmouth backs East Bay energy legislation
Credit: By Melanie Hirshberg As of Tuesday, May 1, 2012 www.eastbayri.com ~~
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PORTSMOUTH – Legislation that would create the opportunity for a public East Bay Energy Consortium (EBEC) was given support by the Portsmouth Town Council April 25.
The council voted 4-3, Councilors Judi Staven, Elizabeth Pedro, and Paul Kesson against, to support introduction of the legislation. The vote does not allow Portsmouth to join the consortium once it is created without a further vote.
Portsmouth is one of nine East Bay cities and towns that are eligible for participation in EBEC, which would fund alternative energy projects in the communities.
First up is a proposed 25 megawatt wind farm project in Tiverton, which would be used to offset the costs of municipal energy consumption currently covered in the budget in all EBEC communities, said project manager Eric Bush. The savings would free up budget money to be used elsewhere, he said.
EBEC would be its own legal bonding authority, said Middletown representative Christine Forster, so it would take out the bonds with no liability to the participating communities to pay them back.
With the wind farm proposal, for example, an agreement with National Grid to purchase the energy created would be enough to be granted a bond, said EBEC’s lawyer, Mark Ryan.
“That agreement funds the bonds that build the wind turbines on the site,” he said. “The energy generated pays back the bonds.”
Any extra goes back to the communities.
National Grid is required to purchase a certain amount of alternative energy every year, said Mr. Bush, and this would be an opportunity to buy it locally. But the company has to agree first, he said.
After the bond payments, division between nine communities, and paying bills, resident Larry Fitzmorris was skeptical as to how much money a National Grid deal would actually bring to Portsmouth.
Additionally, Councilor Kesson asked how the purchase would affect National Grid’s customers, who already get charged for alternative energy purchases. Mr. Bush said he was unsure.
Two main critiques
The main opposition to the legislation came in two subjects – that there is no such thing as “free money” and that EBEC would be granted eminent domain authority.
Councilor James Seveney said that if he understood the proposal correctly, Portsmouth will receive cash from energy creating projects and energy saving projects, but if a project fails, it will be on EBEC as a legal entity to pay back the bond rather than the individual towns – no liability to the taxpayers.
“I’m not seeing the downside here,” he said.
The answer that the revenue from the individual projects, particularly the wind farm, would cover the bond payments, however, was not enough for Ms. Pedro, who asked what happens if the revenue isn’t enough to cover the payments.
“Someone has to pay back the bonds,” she said. How can Portsmouth be part of a bonding power but not have to pay back the bond?
EBEC representatives said repeatedly that some details still had to be worked out, but the towns would not be held responsible for the payments. Ms. Pedro remained unconvinced.
“If projects fail, the taxpayers will pay the bill in one way or the other,” she said.
The other main complaint about EBEC is how it is to become a legal bonding authority.
In order to become a legal state bonding authority, an entity must have either the ability to tax, police, or take eminent domain, said Town Administrator John Klimm. Of those three, the now volunteer-only consortium (http://www.eastbayenergy.org) thought the eminent domain would make the most sense.
Other non-municipal entities already have this power, he said.
That does not mean there are plans to ever use that authority, said EBEC chair Jean-Marie Napolitano. No one was crazy about having that power, and the discussion on it lasted four meetings.
But the Rhode Island economy is poor for everyone, she said, and that means that communities “need to start thinking out of the box – truly out of the box” and start working together.
She does not want to project to fail because eminent domain becomes EBEC’s red herring.
Eligible communities for the consortium include Portsmouth, Tiverton, Little Compton, Middletown, Newport, Bristol, Warren, Barrington, and East Providence. As of the April 25 meeting, all but Newport and East Providence had taken a vote to support the legislation.
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