June 16, 2016

Massachusetts House Debates Hydropower, Wind Energy Bill

The Massachusetts House on Wednesday began debating an energy bill that would require the state's utilities to enter into long-term contracts to buy more offshore wind and hydroelectric power.

"This piece of legislation is historical," said State Rep. Thomas Golden, D-Lowell, chairman of the Joint Committee on Telecommunications, Utilities and Energy. "The House of Representatives today will set a strong, firm foundation for the growth of a fully renewable future."

The bill, H.4377, would require the state's energy distribution companies to solicit long-term contracts to purchase 1,200 megawatts of offshore wind power and 1,200 megawatts of hydropower by 2027. The distributors would be required to enter into the contracts as long as the bids go through an evaluation process and are found to be reasonable and cost-effective. The hydropower could be combined with other renewable energy sources, such as solar energy.

Golden said if the bill becomes law, Massachusetts will be procuring approximately 20 percent of its electric load from renewable sources.

"This is the largest procurement of clean energy that the commonwealth has ever seen," Golden said.

Golden said the procurement of offshore wind will not only provide clean and carbon free energy, but may also "provide an economic boost" to Massachusetts by creating new jobs. Multiple energy companies have proposed plans to develop offshore wind farms off the coast of Martha's Vineyard.

The State House News Service reported that the latest version of the bill, released by the House Ways and Means Committee, would allow utilities to charge ratepayers a fee to recoup some of the costs of getting the renewable energy, such as building a new transmission line. The fee would be capped at 2.75 percent of the company's annual payments for the cost of the new infrastructure.

Key state senators have already said they do not believe the bill is comprehensive enough because it does not include energy efficiency measures.

Numerous interest groups have criticized the bill.

The New England Power Generators Association says the bill would increase costs for consumers by locking part of the Massachusetts electricity market into long-term contracts. The Conservation Law Foundation, an environmental group, is disappointed that the bill focuses on hydropower rather than onshore wind or other renewable energy sources such as solar energy.

George Bachrach, president of the Environmental League of Massachusetts, said in a statement Wednesday that the bill "has taken a small step forward to bring online our massive offshore wind energy resources, but there's much more work to be done." The Environmental League of Massachusetts wants to see the state procure 2,000 megawatts of offshore wind power, rather than 1,200. It also wants to see more energy procured from local sources, such as New England-based onshore wind, and the permanent elimination of a cap on reimbursements for solar energy projects.
State representatives have introduced more than 50 amendments that will be debated during Wednesday's House session.

House Speaker Robert DeLeo, D-Winthrop, predicted that "what you see coming out will be a little bit different than what you see coming in."

But DeLeo said the bottom line will be about increasing the use of hydropower and offshore wind power. Addressing concerns that the bill would raise energy costs, DeLeo predicted that the bill would result in better prices by creating competition.

Gov. Charlie Baker, a Republican who introduced his own bill to expand the use of hydroelectric power, said the House bill will give Massachusetts energy purchasers the ability to not take bad deals.

Baker stressed that Massachusetts is losing 10,000 megawatts of power over the next five years as older power generating stations are retired. "We need to replace it with something, or we're going to be at the mercy of the world market, and we'll probably be buying a lot more dirty fuel than we would be buying if we pursue a more diversified portfolio," Baker said.

If the bill passes the House, it will still need to be debated and passed by the Senate.
Baker said he hopes to sign an energy bill into law before the legislative session concludes at the end of July.

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