Mayors write letter urging House, Senate to overturn Sununu energy vetoes

Monitor staff
Published: 8/14/2018 6:07:11 PM

All but two of the Granite State’s 13 mayors have agreed to back a letter asking legislators to override Gov. Chris Sununu’s vetoes of two energy-related bills.

The letter, drawn up by Mayors Karen Weston of Dover and Tony Giunta of Franklin, assumes unity from the all of the mayors in asking the House and Senate to reverse the governor’s position on Senate Bill 365, which would have required utilities to purchase power from New Hampshire’s six independent biomass power plants; and Senate Bill 466, which would have expanded net metering – a system that allows smaller power generators to get credits for electricity they send to the grid.

All municipalities stand to lose from the vetoes, the letter argues, because they endangered renewable energy projects across the state and have led three biomass plants to close or plan to shutter operations. Supporters say the bills would have resulted in cheaper energy. Detractors saw them as subsidies that are passed on to consumers, driving up the cost of electricity in the state.

The holdouts so far are Laconia’s Ed Engler and Concord’s Jim Bouley. Giunta said all other mayors have verbally agreed to sign the letter before the override day scheduled for Sept. 13.

“The goal is to let state representatives and senators know how important this is for municipalities,” Giunta said Tuesday. “Especially the 13 cities.”

In Franklin, the situation has imperiled six solar projects, all of which are located on city land, Giunta said. Without the benefit of SB 446, those projects will remain small and not generate as much revenue for the city, he said.

Engler’s all too aware of the risk – a solar company is also looking to build a large solar array on a capped landfill, and he said the veto means the company will have to keep the array at 1 megawatt rather than 4.4 megawatts. The smaller array would mean the city will lose out on about $30,000 a year in lease revenue, he said.

But Engler said he agrees with the governor’s reasoning for vetoing the bills: both measures amount to a subsidy that would prop up private businesses at the expense of ratepayers, and that’s wrong, he said.

Still, Engler may end up signing the letter if the Laconia City Council gets on board. Councilors discussed the issue Monday night and plan to bring it up again in two weeks.

“If the city council wants to go on the record as supporting the veto override, then I’ll sign it, regardless of my personal feelings,” Engler said. “I let them know my feelings would not be hurt if they did.”

Mayor Bouley, who was out of state, said via text that he has received a draft of the letter but has not yet signed on.

“I have had a bunch of questions,” he said.

Concord has made strides in the renewable energy field recently, including a goal to have all of the city’s energy come from renewable sources by 2050. The city made some changes to the goal before its passage on July 9; nevertheless, it is still the largest municipality in New Hampshire to have adopted the goal.

If Bouley wants the official endorsement of the council, he would have an opportunity to solicit input three days before the override vote could occur.

In vetoing the bills, Sununu said he was protecting New Hampshire ratepayers from handouts to massive energy companies.

“These bills send our state in exactly the wrong direction,” Sununu said in June. “We need to be taking steps to lower electric rates, not pass legislation that would cause massive increases.”

Supporters say the vetoes have had an immediate chilling effect.

“Impacts of the vetoes are already being felt by the state’s $1.4 billion timber industry; projects taken offline, biomass plants shuttered, workers furloughed and an imbalance between energy policy and the state’s economic and environmental policies,” it reads. “We must reverse these impacts. These two bills reflect the right balance between forward-thinking energy policy, basic economics and preserving a strong and healthy environment for New Hampshire.”

SB 365 was designed to prop up the six biomass plants, which have struggled to stay competitive as natural gas has lowered wholesale energy prices and eaten away profits. Under the bill, electric distribution utilities would be mandated to seek contracts with the plants and buy energy at 80 percent of the default energy rate.

The idea was that the plants, most of which burn wood products, would get the business they need to stay afloat. The reduced purchase price would help offset the cost to ratepayers by purchasing from biomass sources instead of letting the auction market decide.

Most plants are located in the North Country, and three – Pinetree Power plants in Bethlehem and Tamworth and Bridgewater Power Plant in Ashland – announced shortly after the veto they would have to wind down operations.

But even with the reduced purchase price, supporting the plants carried its own costs. The state Legislative Budget Assistant estimated that the bill would lead to increased costs of $15 million to $20 million a year for Eversource and $2.7 million for Unitil, which the analysis said would be passed on in higher rates for both businesses and households.

The issue is sure to play a part in the upcoming September primaries, which will take place just two days before the vote.

(Caitlin Andrews can be reached at 369-3309, or on Twitter at @ActualCAndrews.)

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