As Concord Steam winds down, plenty of questions pop up

  • Hoses carrying gas are seen connected to a boiler furnace at the Concord Steam Corp. plant in Concord on Tuesday, June 9, 2015.(ELIZABETH FRANTZ / Monitor staff)

  • Plant operator Neil Stewart of Manchester opens an access door to one of the boiler furnaces at the Concord Steam Corp. plant in Concord on Tuesday, June 9, 2015.(ELIZABETH FRANTZ / Monitor staff)

  • A turbine is seen at the Concord Steam Corp. plant in Concord on Tuesday, June 9, 2015.(ELIZABETH FRANTZ / Monitor staff)

Monitor staff
Published: 9/6/2016 5:05:13 PM

Plenty of questions continue to surround the complicated process of shutting down Concord Steam, which is why a public information session is scheduled for Sept. 21, but at least one question surprised a dozen people gathered Tuesday for a state hearing on the topic.

Who will own the steam pipes under the city’s downtown streets after Concord Steam is gone?

“The state has no interest in ownership,” Christopher Aslin, assistant attorney general, told the Public Utilities Commission.

Carlos Baia, deputy city manager for Concord, agreed, saying: “The city does not want to own them.”

Perhaps not, but Alexander Speidel, a staff member with the Public Utilities Commission, was firm during a hearing that was called to consider a temporary rate hike but wandered far afield: “We have to make sure that somebody owns it.”

This unexpected issue came up as the PUC, which oversees regulated utilities, began a series of hearings about whether Liberty Utilities should be allowed to buy the ailing Concord Steam for $1.9 million. That sale, if it goes through, will put an end to a firm that has burnt wood in a Concord power plant for more than eight decades and sent the resulting steam underground to as many as 180 buildings throughout the city.

Liberty Utilities will not be operating the heating system, so the power plant on the state office complex will be mothballed – one proposal calls for it to be torn down and replaced it with a parking garage – and all its customers must decide how to heat their buildings.

Most are likely to install gas-fired boilers, which is why Liberty Utilities’ natural gas business was interested. Depending on what current system exists in each building, this could require swapping one system for another, or may require building a structure to hold a new furnace and boiler.

Current plans call for Concord Steam to shut down as of June 1, 2017, although the PUC hasn’t given this plan final approval. The PUC has another hearing set for Friday on the issue and more slated for October, as well as how much customers will pay in the meantime. A Sept. 21 public hearing has been scheduled by Concord Steam and Liberty Utilities to answer public questions and provide more information.

The main topic of Tuesday’s PUC hearing was a request for a one-month rate hike of 22 percent, which Concord Steam President Peter Bloomfield said was necessary to provide enough cash to keep the company operating through the winter. The raise gives it roughly an extra $100,000 in revenue during the month of October, Bloomfield said.

Concord Steam has suffered from a loss of customers and increasing maintenance costs for its power plant, which was built in 1938. It faced a financial “death spiral” before Liberty Utilities offered to buy it.

The three-person Public Utilities Commission took the question of the proposed one-month emergency rate hike under advisement Tuesday. It has set an October hearing on what rates to allow Concord Steam to charge for the rest of its operating life.

The complication for customers is the shutdown of Concord Steam is happening fairly quickly: “Not unexpected, but sudden” is how it was put several times during Monday’s hearing.

Customers – including the state office complex, Concord government buildings around City Hall, and four city schools including Concord High School – will have to install different boilers before the shutdown in July or other heating systems by then. The Concord School Board was scheduled to discuss its plans for the switch-over at a meeting Tuesday.

This timetable is too short for the buildings around the State House, which can’t just slap up a boiler house because of historic district concerns. Those businesses would need legislative permission and funding to do anything.

The long-term solution for the downtown state buildings may involve burying a new boiler under the parking lot next to the New Hampshire State Library, then using newly installed underground pipes to provide heat to the State House, Legislative Office Building, state annex and Department of Justice buildings, said Mike Connor, deputy administrator with the Department of Administrative Services for the state government.

In the meantime, a temporary boiler in the parking lot next to the Department of Justice can make use of the existing steam pipes surrounding the four-block state office park to keep the State House and other buildings warm.

This is where the question of ownership arose Tuesday. The state will need to use those old six- and eight-inch pipes – some so old they have leather gaskets – through at least mid-winter of 2017-18, more than six months after Concord Steam closes, according to Connor.

If something happens to a pipe during that time, who’s the responsible owner? Liability insurance held by a Concord Steam shell company may fit the bill, but people at Tuesday’s meeting were dubious that shell companies are legally allowed to own liability insurance.

That question, and many more will be discussed in the months to come.

Once the state switches over to a new system, and the pipes are no longer used, they will likely be abandoned, officials said.

(David Brooks can be reached at 369-3313 or or on Twitter @GraniteGeek)

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