Published: 1/7/2017 11:29:39 PM
Eversource hasn’t given up its attempt to help pay for a new natural gas pipeline with money from electricity rates, and is appealing the state’s rejection of the idea.
Eversource-NH on Friday filed an appeal with the state Supreme Court, asking it to overturn an October ruling by the Public Utilities Commission that said the company couldn’t buy long-term gas contracts on a proposed pipeline expansion called Access Northeast.
Eversource argues that since the extra gas from Access Northeast would be used to run power plants in winter and help hold down cold-weather electricity costs which can soar when gas supplies can be tight, it would be fair to pay to have electricity customers commit to buying it through rates.
The PUC, however, said such a system would be the functional equivalent of Eversource operating a power plant, which is forbidden under the state’s 1996 deregulation of the electricity industry. The Massachusetts high court reached a similar decision last fall.
Eversource says in its appeal that the decision misinterprets the legislature’s deregulation of the industry, which the company says was designed to increase competition and cut rates, not merely separate electricity transmission and distribution.
Access Northeast is a $3 billion project proposed jointly by power companies Eversource and National Grid, along with pipeline company Spectra Energy. It is designed to increase capacity on Spectra’s Algonquin Natural Gas Pipeline, which runs through Connecticut connecting Boston and eastern Massachusetts with gas supplies in New York state.
Attempts to bring more natural gas into New England have been stymied partly by a mismatch in financing. Power plants, whose income is affected by fuel prices that fluctuate greatly, won’t sign fuel contracts extending more than a few years out, but pipeline companies won’t commit to mutli-billion-dollar construction projects without enough contracts extending a decade or two out.
Such long-term gas contracts are the norm when pipelines deal with heating firms, because there is a relatively stable heating demand every year. Without similar commitments from power companies, firms like Spectra won’t expand gas pipelines.
(David Brooks can be reached at 369-3313 or dbrooks@cmonitor.com or on Twitter @GraniteGeek.)