AS THE LEGISLATURE RUSHES to embrace offshore wind and Canadian hydroelectricity, the Senate on Thursday voted 39-0 to cut off the chief means of financing new natural gas pipelines coming into the region. The Senate’s approach has strong support among House members as well.
The growing opposition to natural gas would have been unthinkable two years ago, when the push began to bring new pipelines into the region to avoid a replay of the sky-high electricity prices that battered the region following the grueling winter of 2013-14. Officials said the high prices were the result of inadequate pipeline capacity.
Several companies announced plans to build new pipelines into the region, but the proposals depended on a novel financing scheme. Electric power generators were unwilling to sign long-term commitments to purchase natural gas pipeline capacity because they had no guarantee they could recover their investments. So their backers suggested utilities should tap electricity ratepayers for the money. The pipeline promoters promised that the cost to ratepayers would be more than offset by the savings from additional, cheap gas coming into the region.
The Baker administration hopped on board, saying the proposal would stabilize electricity rates and avoid the need to burn oil and coal when gas supplies were in short supply during the winter months. In October, Baker’s Department of Public Utilities gave electric utilities the green light to file plans to charge their ratepayers for natural gas capacity.
But environmental groups pushed back, saying it made no sense to build pipelines bringing more fossil fuels into New England at a time when the region is struggling to meet its greenhouse gas emission targets. A study released by Attorney General Maura Healey in November indicated new pipelines weren’t necessary because the region’s power grid wasn’t going to face any reliability deficiencies through 2030.
In April, Kinder Morgan pulled the plug on its Northeast Energy Direct pipeline, citing inadequate capacity commitments from potential customers.
The Conservation Law Foundation, backed by Healey, challenged in court the view of the Department of Public Utilities that electric ratepayers could be charged for natural gas pipelines. The Supreme Judicial Court heard the challenge in May and is expected to rule later this summer.
Not wanting to take a chance on the court’s ruling, Sen. Patricia Jehlen of Somerville filed an amendment to the Senate energy bill that would prohibit the Baker administration from approving contracts for natural gas pipeline capacity that would be paid for by electric ratepayers. She slapped a catchy title on the amendment: “Protecting ratepayers from unwarranted taxation.”
Senate Republicans and Democrats alike voted for the measure, as did all of the Senate’s leaders. Jehlen’s argument was simple: If companies believe natural gas pipelines are a good investment, let them invest their own money, not the money of electric ratepayers.
The only one to voice any concern about Jehlen’s amendment was Sen. Viriano de Macedo of Plymouth, who said there is a need for additional pipeline capacity. But even he voted in favor of the amendment.
The amendment, along with the rest of the Senate energy bill, will now go to a conference committee with the House charged with resolving differences between the two branches. The differences are many, so it’s unclear whether Jehlen’s provision will survive.
When the House was debating its energy bill, Republican Rep. James Lyons of Andover pushed an amendment that was similar to Jehlen’s. House leaders ruled it out of order, saying the bill didn’t have any provisions affecting natural gas. But there is strong support in the House for blocking what is being called the “pipeline tax.” Between 90 and 100 members of the House signed a letter to House Speaker Robert DeLeo urging him not to include language in the House energy bill authorizing a pipeline tax, and the language wasn’t included.
Whether the 90 members can convince leadership to back the Senate approach in conference, however, is far from clear. What is clear is that natural gas is in retreat on Beacon Hill. Not even the Baker administration is talking up pipelines anymore.
Bruce, you write that Baker admin. doesn’t talk up gas anymore. That was the plan all along. Away from the spotlight, DPU gave utilities green light, so legislators would never have to take a vote to impose a pipeline tax. Passive aggressiveness. But the Senate understood the game being played. If the Jehlen amendment doesn’t survive the conference committee, there’s something rotten in the House.
This sounds like good news to me!
Good!
Now all we got to do is stop pushing intermittent, variable, and valueless power from wind and solar. That will restore the market for coal and nuclear and guarantee the lowest rates possible for the state and the region.
Senate Republicans and Democrats alike voted for the measure, as did all of the Senate’s leaders. Jehlen’s argument was simple: If companies believe natural gas pipelines are a good investment, let them invest their own money, not the money of electric ratepayers. I hope they will say this to the wind and solar crowd… If it’s such a good investment, then let the companies pay !!!