September 16, 2014
Massachusetts

Deval Patrick’s renewable revolution

Jon Chesto | Boston Business Journal | Sep 26, 2014 | www.bizjournals.com

Gov. Deval Patrick strode to the center of the state’s cavernous wind-blade testing center on the Charlestown waterfront, his aides falling in around him.

Patrick, of course, had some good news to share with the world: Jim Gordon’s Cape Wind Associates just signed a lease for the state’s new waterfront terminal in New Bedford, ensuring the giant turbines for Gordon’s offshore project would be assembled here and not in Rhode Island.

The press conference took place beneath two turbine blades, each at least the length of half a football field, jutting out from the back of the testing center’s rear wall. What this lease meant, Patrick told the crowd with Gordon at his side, was that Cape Wind isn’t just going to provide power for Massachusetts. It’s also going to provide well-paying jobs to a part of the state that desperately needs them.

This month’s agreement with Cape Wind was a big victory for Patrick, one that he savored as he looked out at the bright September sunlight that morning. Few governors have pushed clean energy the way that Patrick has done, and the fate of what could be the country’s first offshore wind farm has been closely tied to his eight-year tenure at the State House.

But it’s not just Cape Wind. Under Patrick’s watch, Massachusetts has vaulted to one of the top states in the nation for energy-efficiency efforts and solar panel deployment. The state has an ambitious plan to curb a quarter of its greenhouse gas emissions by 2020. Many hospitals and restaurants here will soon be forced to recycle their food waste.

Of all his accomplishments in this field, Patrick says he’s most proud of the tens of thousands of new jobs created in the past seven years, now supporting nearly 90,000 people, from all kinds of backgrounds and all walks of life. Companies that were once small startups – Next Step Living, First Wind, EnerNOC, among them – have emerged as major employers, thanks in part to policies pushed by the Patrick administration.

“We’ve had double-digit job growth in cleantech in the last few years,” Patrick says. “When the bottom was falling out of the global economy, the growth in the cleantech sector, alongside life sciences and digital technology, that’s how we climbed out of the recession faster than other states.”

Patrick’s aggressive advocacy on energy issues has generated its fair share of critics. Some business groups, such as Associated Industries of Massachusetts, complain that pushing expensive offshore wind unfairly saddles ratepayers with extra costs and the renewable energy focus diverts state officials’ attention from more pressing energy issues: Retail electric prices here are nearly 40 percent higher than the U.S. average, and the region’s grid operator has warned that rolling blackouts may be needed to keep lights on as soon as 2016 due to the loss of older plants. People who live near windmills griped about how their issues seemed to fall on deaf ears. Even some of Patrick’s supporters in the environmental community moaned about his stance in support of using natural gas as a bridge fuel to get to widespread use of renewable energy.

But it’s hard to argue that Patrick won’t leave a lasting impact on New England’s energy industry after he leaves office in a few months. Patrick didn’t reach these accomplishments alone – he had a team of strong-willed advocates in his administration, and an often sympathetic ear among the Legislature’s leaders. However, it was Patrick, as the state’s chief executive, who set the tone that spurred a steady stream of new laws and regulations that dramatically reshaped the state’s energy policy.

Patrick says he was driven, in part, by his experience as a top lawyer at Texaco. He says he developed a keen understanding of the volatility of fuel prices there, and of the energy industry’s far-reaching economic and environmental impact. When Patrick considered the wealth of high-tech talent and top-notch research universities in this state, he saw the foundation for an almost entirely new industry.

Among the first things he did after taking office in 2007 was to merge the state’s energy and environmental affairs into one agency, under one secretary. This had the effect of ensuring that energy decisions were made with the environment in mind, and vice versa. Patrick didn’t see these realms as antithetical; instead, he argued, they’re codependent. During his first two years in office, Patrick championed a number of critical energy bills, including the Green Communities Act of 2008, and he ensured that

Massachusetts would play a key role in the Regional Greenhouse Gas Initiative after predecessor Mitt Romney had distanced the state from that effort.

One of those bills led to the creation of the Massachusetts Clean Energy Center, a quasi-public agency funded by the renewable-energy charge on electricity bills. The agency’s task wasn’t just to find ways to put windmills and solar panels up around the state. Equally important: paying for training to prepare a skilled workforce and for research to make renewable energy more efficient and cost-effective.

Patrick knew this state faced issues of electricity and natural gas transmission constraints. But he saw those constraints as a challenge with the potential to make this state a national, if not global, leader in clean energy. “I understand the vulnerability in Massachusetts of being at the end of the pipeline, not being able to control our energy costs and being historically high priced for electricity,” Patrick says. “(But) it was a tremendous opportunity to take our challenges and build on our unique strengths, most especially the concentration of brainpower here.”

Patrick’s history with Cape Wind goes back to 2005 when he entered the governor’s race. He came out early in support of the project, as the early favorite in the Democratic party, former Attorney General Tom Reilly, took the opposite approach. Patrick ended up beating Reilly in the 2006 primary.

Patrick remained a champion of Cape Wind throughout his eight years as governor, even after it became clear that ratepayers would pay a slight premium to buy power from the offshore wind farm. National Grid was the first to sign a contract with Cape Wind, to buy half of its power. NStar came to the table late, finally agreeing to a contract as the Patrick administration was reviewing its merger with Northeast Utilities. The Cape Wind project faced numerous delays as well-heeled opponents on the Cape sued to block the $2.5 billion project at every turn. (The NStar contract remains before a federal appeals court.) But lately, the pieces have been falling into place in terms of financing, and Gordon hopes construction can start in early 2015. The wind farm would feature up to 130 turbines that could generate up to 468 megawatts of power on the windiest days.

Patrick sees the state’s new $100 million terminal in New Bedford, which is under construction, as playing a key role in serving other wind farms that would be built in deeper waters south of Martha’s Vineyard. The potential is there, Patrick says, for enough wind turbines to be built to provide as much as half of Massachusetts’ electricity needs. He says the extra upfront costs for offshore wind development will more than pay for itself in the long run by providing some stability against the likely rise in natural gas prices.

The Patrick administration took a few big steps in the past two years toward supporting the proliferation of anaerobic digestion plants in the state. The biggest of these steps was a new regulation requiring businesses that churn out more than one ton per week of food waste to recycle it and keep it out of landfills and incinerators. The aim was to get much of this food waste toward anaerobic digesters that can convert the gas from this waste into energy. The goals are modest, compared to wind and solar, with state officials hoping for at least 50 megawatts of digester-related power to be online by 2020.

One black mark on Patrick’s clean-energy efforts is the Evergreen Solar debacle, in which the state provided millions to subsidize a solar panel manufacturing plant. Roughly 800 jobs were lost when the plant closed in 2011.

But solar installation has turned out to be a big business for us. More than 8,000 people work in the state’s solar industry today, and the state’s 600-plus megawatts of solar power ranks Massachusetts fifth among all states. When Patrick took office, the state’s solar panel capacity was under five megawatts.

The 2008 Green Communities Act, and subsequent legislative and regulatory updates, set in motion two crucial policies that would spark this solar renaissance. The 2008 law put in place a net metering system, one that would allow owners and developers of solar panels to essentially sell that power back onto the grid. The law also gave the administration the authority to develop a new solar credit system that would be used by the utilities to help meet the state’s mandated renewable power goals. The MassCEC’s “Solarize Mass” program also encouraged the proliferation of small-scale solar projects on the rooftops of homes and businesses.

But Patrick didn’t have as much success with his administration’s recent effort to revamp the solar credits and codify into law his goal of getting 1,600 megawatts of solar installed in the state. By the time the Legislature adjourned from formal sessions for the year on July 31, the comprehensive solar bill had died. Only an increase in the amount of allowable net metering made it into law. Lawmakers will certainly revisit the issue next year, but it will be under a new governor.

Patrick has had less success with onshore wind power. There was a surge in wind turbine growth in 2011 and 2012. But it slowed to a crawl in 2013 – during a national slowdown linked to concerns about the potential loss of federal tax credits – leaving the state with just over 100 megawatts of installed wind turbine capacity. As with solar, the availability of net metering played a big role in wind turbine construction. Wind power also benefits from renewable energy credits, although wind didn’t get the special “carve-out” that solar received. But clashes with neighbors in places such as Falmouth and Fairhaven have raised concerns about wind turbines’ noise, shadow flicker and impact on property values. A MassCEC spokeswoman says only 3 megawatts of wind generation were installed last year, compared to 55 in 2012. Lawmakers ultimately resisted a bill championed by the Patrick administration that would have expedited the permitting process for turbine developers.

But there have been successes, too. The Green Communities Act prompted local utilities to enter into competitive long-term contracts, including with two of First Wind’s projects in Maine. And the MassCEC says its nearly $40 million blade testing center in Charlestown now generates more than enough revenue to cover the three-year-old center’s operating costs.

During Patrick’s tenure, the end days were set for all of the state’s old coal-fired power plants. To help replace this lost electricity, Patrick has looked to the north, at the plentiful hydropower in Canada. His administration tried this year to get a bill through that could have brought in large amounts of hydropower – perhaps more than 2,000 megawatts— as part of a regional initiative with New England’s other governors to address electricity reliability and concerns over price volatility.

The bill was far too complex for the Legislature with just six months left to vote. It didn’t help that environmentalists expressed concerns that the hydropower could crowd out the solar and wind sources that Patrick has been trying to encourage. The bill is expected to return in some form next year, in part due to the state’s increasingly pressing electricity needs and its mandate to reduce greenhouse gas emissions from 1990 levels by 25 percent for a 2020 deadline.

The Green Communities Act also reworked the formula for how much money that utilities would set aside for efficiency measures to help homeowners and businesses curb their energy costs. This prompted an explosion in energy efficiency spending, with funds overseen by the state rising from $213 million in ratepayer funds for 2009 to $609 million for 2013. Other steps included tightening building codes and requiring greenhouse gas emissions to be considered in reviews of large developments. The American Council for an Energy Efficient Economy recognized Massachusetts as the most energy efficient state in 2013, for the third year in a row.