CONTRIBUTORS

It’s legislators’ right, duty to approve East Millinocket mill’s ability to sell power to grid

A mill in East Millinocket.
John Clarke Russ | BDN
A mill in East Millinocket. Buy Photo
Posted March 16, 2014, at 9:23 a.m.
Last modified March 17, 2014, at 3:38 p.m.

Maine lawmakers should approve LD 1792, which would allow East Millinocket’s Great Northern Paper to collaborate with Canada’s Brookfield Renewable Energy to sell power a few times a year to the regional energy grid.

Since 2002, Brookfield has owned the hydroelectric power plants on the nearby Penobscot River, a publicly owned waterway. The billion-dollar utility also owned the paper mills in East Millinocket and Millinocket, but shut down Millinocket in 2008 and then East Millinocket in April 2011. Great Northern Paper purchased both and restarted the East Millinocket mill in late 2011. Brookfield held onto the dams.

It was a good partnership that benefited the hundreds of employees that Great Northern Paper put back to work. Today, Great Northern Paper is restructuring to become viable over the long term, and the company must be allowed to collaborate with Brookfield to sell power, or “load shed.” It’s a critical component of Great Northern Paper’s restructuring plan to restart the mill in May.

The precedent was set centuries ago. In the 1800s, the people of Maine, through their legislature, allowed investors to dam our rivers and generate power to support industrial development. The dams still exist today for the same reason, to benefit the public. Specifically with respect to the Penobscot dams in East Millinocket, an 1897 Private and Special Act of the Maine Legislature granted the rights to generate hydropower using the water owned by Maine’s citizens for the paper mills and other manufacturers.

The 1897 act has been updated by the Legislature several times since then, most recently in 2002 before Brookfield purchased the dams and mills. The 2002 update prohibited Brookfield from load shedding at the mills, since the company owned both the power-generating assets and the mills. The idea was to ensure the billion-dollar, foreign utility wouldn’t shut down the mills and simply sell the hydropower.

This safeguard is no longer needed because Great Northern Paper is completely committed to restarting the mill and running it long into the future. The 2002 legislative update is hurting Great Northern Paper’s ability to restart, and it should be updated again to benefit the mill and its workers.

Unlike other power producers who pay for fuel to generate electricity, Brookfield gets it fuel — the Penobscot River water — for free. The people of Maine own this fuel source, and they bestow it to Brookfield at no cost. Since the mill shut down in January because of high production costs, Brookfield has been selling the electricity that would have powered the mill to the grid for a significant profit, according to its spokesman. It’s fine for private companies to make a profit, but Brookfield also has a responsibility to support the region’s economy.

Passing LD 1792 will allow both companies to profit and be sustainable.

Some have claimed it would be unconstitutional for the Legislature to amend the law and get involved with the business between Great Northern Paper and the Canadian utility. The law clearly states the opposite. The Legislature, as trustee for the public, has the constitutional responsibility to manage the surface waters for the benefit of the public. A 1982 attorney general opinion affirms this, stating, “the waters of the state, whether located in tidal areas, nontidal areas or great ponds, are held in trust by the state for the use of its people … the Legislature, as trustee for the public, has the constitutional responsibility to manage such lands and waters for the benefit of the public.”

LD 1792 does nothing to nullify or change the existing power purchase agreement between Brookfield and Great Northern Paper. It simply amends the Private and Special law that has governed the use of the state’s water to provide power to the Millinocket mills for over 100 years.

The Legislature has every right and a responsibility to be involved. It always has been. The relationship between the mill and dam owners has never been just a business relationship between two private companies. Legislators, as trustees for the people, have always played a role, and they have an obligation to continue, especially when hundreds of mill jobs are at stake, along with the Katahdin region’s fragile economy.

No other businesses would be impacted by LD 1792. It only refers to the Private and Special law that specifically governs the relationship between the publicly owned Penobscot River, the hydropower dams’ foreign owner and Great Northern Paper.

We respect and appreciate the legislators for the role they have. They have an obligation and a responsibility to the people of Maine and to the employees and the people of the Katahdin region to review and revise the laws governing the use of the state’s waters. It is their role to provide for the best interests of all concerned. I ask them to do so by passing LD 1792.

Duane Lugdon is staff representative in Maine for the United Steelworkers International Union.

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