December 13, 2017
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Maine competes on energy costs, so why ‘misrepresent the real facts?’

By Darren Fishell, BDN Staff
Updated:
BDN File | BDN
BDN File | BDN
Peter Vigue, CEO Cianbro

PORTLAND, Maine — Cianbro chairman Peter Vigue gets a little bit frustrated with talk of Maine’s high energy prices, because the state can claim New England’s lowest average electricity costs since about 2008.

“It’s really a distraction and convinces people that we’re not going to be competitive,” Vigue said.

From experience at the helm of a construction firm in Pittsfield that has won contracts around the country and last year brought on 300 more employees to boost its headcount to about 1,750, Vigue said politicians should trumpet Maine’s low power costs relative to other New England states.

The price of electricity in Maine is lower than the average for other New England states but higher than states in other regions, according to monthly retail price data from the U.S. Energy Information Administration.

Where is the competition?

What’s harder to pin down is whether there’s an economic impact from elected officials, most notably Gov. Paul LePage, and other policymakers railing against Maine’s energy costs and blaming the state’s economic woes on them.

Vigue thinks there is.

“It affects the economy of the state and the perception that people have of our state,” Vigue said in a telephone interview. “And the New England states are our primary competitors in bringing business here.”

Patrick Woodcock, director of the Governor’s Energy Office, said Vigue is right about Maine’s competitiveness within the region, but that concern with major manufacturers takes a broader view.

“The most exposed companies to energy pricing are ones that are not in a competitive advantage in having a comparatively lower priced electricity to other New England states,” Woodcock wrote in an email. “Our forest products industry is competing with Minnesota, Wisconsin, Michigan, North Carolina, Canada and beyond. Our semi-conductor industry is competing globally. [Bath Iron Works] is competing with Florida and Louisiana for the contract for Coast Guard cutters.”

Trouble for Maine’s paper industry has put power prices in sharp relief and framed energy issues for lawmakers in Maine’s Legislature and for LePage, who has through two terms regularly singled out what he calls excessive and uncompetitive energy costs as a top economic burden for businesses.

But Vigue said, at least in the case of Madison, that pointing only to energy costs puts too much blame on what is really the result of a changing market.

“The demand for paper is shrinking and it has been for 25 years and yet we make these statements that are unfounded,” Vigue said.

During public appearances in early April, LePage cited energy costs as the reason the state would lose between 1,200 and 1,500 jobs this summer from two companies, which he has not identified and for which the Bangor Daily News has not yet found evidence. In the wake of the Madison paper mill closing, LePage also pointed to energy costs.

The right message for Maine

So, then, how should policymakers in Maine discuss the state’s relative power prices? What are the goals and what are the appropriate comparisons?

For companies to see an advantage from the regional relation of Maine’s power prices, Woodcock said a company would need a strong case for being here in the first place. Vigue said he thinks there’s a bigger market for that kind of promotion.

“These are cold weather states that have a unique climate, and we need to focus on promoting and sending out that we have the lowest energy costs in all of New England,” Vigue said. “That’s a pretty positive statement, I think.”

For Vigue, it comes down to tone.

“What good does it do to talk about things — especially when they’re not true — in such a way that they just tear the state down and misrepresent the real facts?” Vigue said.

Dana Connors, executive director of the Maine State Chamber of Commerce, said discussing energy policy is a balancing act, and one in which he sees balance, agreeing with Vigue that there’s a regional perspective to promote but noting it’s not all that matters for some businesses.

“Where we run into issues is not the New England reference but the national reference,” Connors said. “When the headquarters of a company looks at the plants that they have throughout a broader territory, then we’re put in the position of comparing ourselves with other states, not just in New England.”

While there are big economic stakes in the direction of future power prices, Connors said, Maine shouldn’t neglect the good foot it can put forward regionally.

“That’s an important advantage and one that we should not shy away from making sure that we promote,” Connors said.

 


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