The looming shutdown of Pilgrim Nuclear Power Station in Plymouth is quickly transforming the debate about energy on Beacon Hill, moving it out of the policy-wonk arena and into the political realm.
The most obvious evidence of that shift came on Wednesday when the Environmental League of Massachusetts announced it was forming a super PAC and would try to rid the Legislature of a dozen lawmakers who fail to take sufficiently pro-environmental stands during the upcoming energy debate. The group said its first order of business is to help Democratic Rep. Michael Brady defeat Republic Rep. Geoffrey Diehl in a contest for a vacant state Senate seat in Brockton.
“I think the environmental community has been tiptoeing around the edges of decision-making, so muscle is what we intend to build,” said George Bachrach, the president of the league and the new PAC.
The tone at the State House is also changing. The Pilgrim nuclear power plant generates 680 megawatts of baseload clean energy that will be very difficult to replace. After months of backroom talks and proposals, the Pilgrim announcement has added an urgency to the discussion and propelled the key players into deal-making mode.
Gov. Charlie Baker’s energy mantra is that he wants to meet the state’s carbon emission targets but in a cost-effective way. Matthew Beaton, the governor’s secretary of energy and environmental affairs, said in a brief interview at the State House on Wednesday that the administration’s position hasn’t changed, but he indicated there would be plenty of room to negotiate. “We’ve got to play some politics,” he said.
The four big energy variables on the table are natural gas pipeline infrastructure, Canadian hydropower, solar, and offshore wind. Beaton said everything but the gas pipeline infrastructure requires legislative action. Let’s look at each variable individually.
Natural gas – The Baker administration is proposing that electricity ratepayers be assessed for new natural gas pipeline capacity that would bring cheap Pennsylvania gas to the region on a year-round basis. Beaton said he expects the new gas supplies to actually reduce the price of electricity. The administration seems determined to push ahead with its pipeline plans despite opposition from communities that would play host to the pipelines and from environmentalists who feel that the region is already too dependent on gas for power generation. A key marker on this issue could be a study commissioned by Attorney General Maura Healey on whether new pipeline infrastructure is needed. The study is due out later this month.
Canadian hydropower – North-of-the-border power is the administration’s answer to the closing of Pilgrim. Beaton said Canadian hydro would be cost-effective, clean, and reliable. “Hydro is the best resource to help us meet all three of those targets,” he said. Bachrach said his environmental group would favor two transmission lines from Canada delivering hydroelectricity, but he said he would like the lines to carry a 70-30 mix of hydro and wind power, which could help foster an onshore wind industry in the region. Entergy Corp., the owner of Pilgrim, said on Tuesday that the Canadian hydropower would be imported at “above-market prices.” Beaton said the company’s word choice was unfortunate, but noted that all contract prices would be subject to regulatory review.
Solar – The sides are pretty far apart on solar. The Baker administration says it wants solar power to continue to grow, but with reduced incentives. The solar industry and environmental groups want to maintain the status quo. Bachrach didn’t pull any punches in discussing the administration’s proposal for a sharp reduction in one solar incentive. “That will drive the solar industry out of the state,” he said.
Offshore wind – Beaton and Baker didn’t even mention offshore wind at a recent energy hearing, but it’s clearly on Beaton’s mind now. House and Senate leaders are supportive of offshore wind, largely because of the prospect for developing a new, local energy industry in the southeastern corner of the state. Offshore wind developers have formed a trade association led by Matthew Morrissey and they make a very convincing case for the industry’s potential. House lawmakers favor a carveout for offshore wind, which would require state utilities to seek competitive bids for a set amount of offshore wind power over the course of several years.
Beaton is wary of a carveout because it limits the state’s ability to back out if prices come in too high. The secretary said offshore wind is not a top priority in the governor’s energy policy right now, in part because of cost concerns. “We’re getting promises of 10-cent offshore wind,” he said. “Do you honestly think they can produce 10-cent offshore wind today? That’s what we’re being told. I want to see the numbers.”
Bachrach seems weary of Baker’s preoccupation with price. “The governor uses a phrase that is difficult to understand in terms of energy policy,” he said. “The phrase is: I support renewable energy provided it is price competitive. I don’t understand what that phrase means, honestly. Renewable energy, like most startup industries, is always going to cost somewhat more. But there’s been ongoing confusion in this state between cost and price. Cost of production delivered to utilities might be somewhat higher, but the price charged to the consumer, after that small amount of renewable energy is mixed in with the larger portfolio, is negligible.”
Bachrach said cost should always be a factor in decision-making. “But cost is not the deciding factor as to why companies locate here or expand here,” he said. “This is a high-cost state. If you want low costs, you can go to Alabama or Oklahoma.”
Lawmakers went on a fact-finding trip to Denmark this summer to learn about offshore wind and came back convinced it could work here. Beaton is skeptical, primarily because of pricing concerns.
“It makes a lot of sense to do this in Denmark. Want to know why it makes sense to do it in Denmark, more sense than it does here?” he asked. “Because the average price of a kilowatt hour is 35 cents there. It’s 13.5 cents a kilowatt here and we’re fifth-highest in the nation.”
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