Last winter, Eversource increased electricity rates by 29 percent and National Grid jacked their rates by 37 percent. What happened?
No one’s really sure. Prices have gone down some, but they’re still higher than this time last year.
Maybe it was a supply and demand thing, like the energy companies say. Maybe there was some price gouging, like angry customers say. Maybe a little of both.
(Side note: Eversource is the new name for Western Mass Electric Co. The name-change was part of rebranding effort by parent company Northeast Utilities Industry leaders say the move may have had something to do with the company’s piss-poor customer service reputation. Northeast was the lowest-rated utility of their size in a 2014 J.D. Power customer satisfaction survey.)
Gas suppliers say they aren’t able to import enough gas through existing pipes to meet New England’s fuel demands. Natural gas moratoriums for new customers have been imposed in 10 communities, including Northampton and Amherst, by Columbia Gas and Berkshire Gas. The solution, some industry officials say, is to have Kinder Morgan build a new pipeline, the Tennessee Gas Pipeline’s Northeast Energy Direct project. This $2.7 billion, 430-mile long distribution channel would run through Pennsylvania, New York, Massachusetts, New Hampshire, and Connecticut, and locally would cross through Plainfield and eight towns in Franklin County.
Who would pay for this project is a bit up in the air. Customers may pay for construction through a tariff or Kinder Morgan could pay using company profits … it gets from selling fuel to customers.
Environmentalists concerned about the proliferation of non-renewable energy resources and the potential for the pipeline to transport fracked gas are against the project. And skeptics like me wonder if the North East’s capacity problem isn’t an excuse to get taxpayers and customers to buy Kinder Morgan a shiny new line they’ll use to help the area, yes, but its main use will be to shuttle more natural gas to where it can be exported to foreign markets that will pay more for the fuel.
There are alternatives to building a new pipeline. Gov. Charlie Baker says a new line may be necessary, but it should be built along existing utility right of ways. And GDF Suez North America says with a little investment their storage facilities around New England could hold enough liquefied natural gas to get through the winter.
With all the questions surrounding Massachusetts’ energy needs, it’s nice to see the state step in to do some unbiased research on the issue. Attorney General Maura Healey recently announced her office is undertaking a study of natural gas capacity and electricity reliability. The study will not only shine a light on why prices have spiked, it will also answer the underlying question of whether Massachusetts needs the Tennessee Gas Pipeline. “Our goal with this study is to identify the most cost-effective solutions for ratepayers that will also allow us to achieve our regional climate goals,” Healey said.
To be clear, Massachusetts does have very real energy problems and some kind of large investment will most likely be needed to improve the situation. New England has not developed energy infrastructure fast enough to keep up with growing consumer demands. To make matters more difficult, energy producers Mount Tom Power Station in Holyoke and the Vermont Yankee nuclear facility stopped production over the last several years. Though the state’s overall energy consumption is low compared to others, Massachusetts doesn’t produce natural gas, but we rely heavily upon it, consuming half the natural gas that flows into New England. The fuel is used primarily to generate electricity and heat homes. In 2000 15 percent of the area’s power was produced by natural gas, according to ISO New England, a quasi-public group that oversees electricity production in New England. Last year that portion had grown to 44 percent. New England needs an additional 1.1 to 1.6 billion cubic feet of additional daily capacity to fuel the region’s natural gas generators during periods of peak demand, says ISO.
So far, the people proposing solutions are the same people seeking to get paid to fix the problem — which makes sense. But in a rush to get paid, numbers get twisted. While studies have not been conducted specifically on the outcomes of industry supported energy-needs research, many people have looked into how industry-funding impacts the results of pharmaceutical and medical manufactured items. What analysts have found is whoever pays for the study is more likely to get the answers he’s looking for — in some cases industry funded research is four-times more likely than publicly funded research to find results that favor the industry.
And recently, we all found out that a study on the natural gas supply in New England funded by Kinder Morgan that said bigger pipelines are needed now was based not on the usual gas consumption of the consumer, but on a peak 30-40 days in the winter. The report made it seem that this dire situation was a 365-day-a-year nightmare, when in fact we’re talking about February into early March.
Healey’s report is due out in October. With the knowledge that Massachusetts does need to make an investment of some kind to bolster the energy supply in the state, it’s not clear which plan would be the most cost-effective. With Healey’s report, people should finally get an unbiased analysis of the situation.•
Contact Kristin Palpini at editor@valleyadvocate.com.
