August 19, 2018
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Maine needs new natural gas capacity to control our energy costs

George Danby | BDN
George Danby | BDN
By Dana Connors, Special to the BDN

A handful of extremists are holding up Maine’s economic and energy future. They are blocking New England’s access to affordable, clean burning natural gas, keeping us captive to high energy prices during the recent bone-chilling weather.

Enbridge’s Atlantic Bridge, which would move more natural gas into our state, is being held up so Massachusetts can appease a small group of national and local activists — even though the federal government approved the project and deemed it necessary and having minimal impacts.

We all want a robust economy for our families and state. Accessing natural gas can help us achieve both as we continue to develop the technologies necessary for renewable energy.

Natural gas generates roughly half of the region’s electricity. It is abundant and available in the Northeast. But to access it, we need more pipeline capacity to move nearby domestic supplies of natural gas into New England.

A 2015 study for then-Massachusetts Gov. Deval Patrick’s administration concluded Massachusetts alone would need 600 million to 800 million cubic feet per day (cf/d) of incremental pipeline capacity to fuel gas-fired power generation beyond what could be provided by alternative resources. Previously, the New England States Committee on Electricity called for increased capacity of 1 billion cf/d above 2013 levels. The Industrial Energy Consumer Group testified before the Maine Public Utilities Commission that the region needs 2 billion cf/d of new pipeline capacity.

Our lack of pipeline capacity is having a profound impact on the region and was especially heightened during our recent cold weather when energy prices soared.

For several years, ISO New England, the organization charged with making sure most of New England has enough electricity, has been warning us of the danger of insufficient natural gas infrastructure.

In June 2016, its executive director, Gordon van Welie, wrote to then-Energy Secretary Ernest Moniz that “Constraints on the region’s natural gas pipelines, particularly in combination with severe weather and/or contingencies that reduce/eliminate the output from non-gas generators, could endanger reliability and will continue to increase wholesale energy prices.”

The region did not heed these warnings, and they came true in recent weeks.

During our freezing cold snap, natural gas-fired power plants competed for limited supplies with utilities delivering natural gas to heat homes and businesses. There simply was not enough natural gas for both because of a lack of pipeline capacity. As a result, natural gas prices were higher in New England than anywhere else in the entire world.

With much of the region’s natural gas committed to heating and exorbitantly priced, ISO New England instituted its winter reliability plan, placing oil-fueled electric generators into service to meet the demand for electricity.

Over that time, New England used more oil and coal than it normally does. On Christmas Eve, oil generated 2 percent of our electricity. That figure jumped to more than 36 percent on Jan. 6, according to ISO New England’s Cold Weather Operations analysis. It reveals the region burned almost 2 million barrels of oil from Christmas Day to Jan. 9, more than all of 2016 through Dec. 24, 2017. This increase directly affected the oil supply for Maine residents and businesses, shifting it to power generation.

Here in Maine, where oil is predominantly used to heat our homes and businesses and power our commercial and industrial sectors, fuel oil was headed to northern New England, but ISO New England “expected that power plant demand [would] quickly consume those re-supplies.” ISO New England also indicated the region’s “oil inventories are still depleted.”

Of course, the cost of electricity increased during the cold snap as well. ISO New England reports the day-ahead market cost of electricity rose dramatically to a daily average of $68.6 million between Dec. 26 to Jan. 8, up from a daily average of $18.7 million from Dec. 1 through Dec. 25.

So the small group of extremists fighting pipeline expansions in New England hurts us here in Maine on two fronts. Because they have opposed projects like Access Northeast, we have a limited amount of natural gas available for regional electric generation on the coldest days. And delays to Atlantic Bridge deny us access to more cost-effective domestic natural gas supplies for our homes and businesses. Atlantic Bridge’s infrastructure, already authorized by the federal government to be built in Massachusetts, is critical to transporting natural gas molecules into our state.

Additional regional pipeline capacity means Maine will have more reliable and affordable energy to drive our economy and protect ourselves from extreme weather events.

Dana Connors is the president of the Maine State Chamber of Commerce.

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