Millinocket takes mill owner to task over electricity sales

By Kevin Miller, BDN Staff
Posted March 05, 2009, at 10:23 p.m.

AUGUSTA, Maine — Millinocket-area officials accused the owner of the Katahdin Paper Co. on Thursday of being more interested in making profits selling electricity than operating the mills that have long been the lifeblood of the region’s economy.

The harsh comments came during a legislative hearing on a proposal that would force Brookfield Asset Management to continue supplying power to the mills as part of the company’s use of the state-owned water that flows through its dams.

“The people of the Katahdin region must stand up and say enough is enough,” said Charles Cirame, a Millinocket retiree who worked 30 years in the mills. “We must stand up and demand our waterways benefit the people of the area.”

Rep. Herbie Clark, D-Millinocket, introduced LD 543 in response to mounting frustration among millworkers and Millinocket-area officials about the fate of Katahdin Paper’s two mills in Millinocket and East Millinocket.

Katahdin Paper Co., a subsidiary of Brookfield, closed the Millinocket paper mill indefinitely last August despite efforts by the Baldacci administration to help the company find a solution to its energy crisis.

Local officials and millworkers contend the mill was making a profit and had ample orders when it was shuttered, putting most of its 200-plus workers on the street.

“Unfortunately, I am under the belief that their purpose was not to run the paper mills but actually to let them wither and die,” said Scott Gonya, a Millinocket councilor. “If you don’t make investments in these facilities, they can’t keep running.”

No representatives from Brookfield spoke during the Utilities and Energy Committee public hearing. Company officials could not be reached for comment Thursday night.

Brookfield acquired the mills and six hydropower plants on the nearby Penobscot River after Great Northern Paper went out of business. Clark’s bill would change a legislative agreement governing operations of the dam to require that Brookfield give first priority to powering the paper mills before selling electricity on the New England grid.

Clark said those water rights come with obligations to the Katahdin region and all of the people of Maine.

“We gave them something … with the understanding that they are going to run those paper mills,” Clark said. “We gave them something with the understanding that they are going to be there tomorrow. We all know they got those mills at a steal.”

David Cyr, a Millinocket councilor, joined with several others in accusing Brookfield of making large profits by selling on the market the electricity that would have gone into the now-idle paper machines.

While Brookfield had made clear its intention to sell the mills eventually, the company has no obligation to continue selling power to new owners at good rates.

“We do know that without reasonable power rates, the mills will not survive long term,” said Millinocket Town Manager Eugene Conlogue.

Several committee members expressed concerns about the precedent of the bill as well as whether it would constitute a “taking” by the state. The committee will hold a work session at a later date.

http://bangordailynews.com/2009/03/05/news/bangor/millinocket-takes-mill-owner-to-task-over-electricity-sales/ printed on April 25, 2014