November 24, 2017
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LePage seeks to change rules on biomass bailout bill he signed

By Darren Fishell, BDN Staff
Updated:
Chris Cousins | BDN | BDN
Chris Cousins | BDN | BDN
Gov. Paul LePage during a press conference at the State House.

PORTLAND, Maine — Gov. Paul LePage wants more frequent reviews of job-creation promises from two biomass generation companies to help them free up investment cash.

In a letter to regulators dated March 16 and filed publicly Monday, LePage has asked the Maine Public Utilities Commission to change the rules for two biomass companies getting $13.4 million in taxpayer subsidies over two years.

One of the companies has proposed a massive regional plan to restart biomass plants and build a biofuel refinery in East Millinocket.

[ Could biofuel save Maine’s timber industry?]

To get the subsidies, the two companies together promised to employ 87 people and buy 1.1 million tons of Maine wood waste each year.

The companies receive subsidy payments each month. At the end of the year, regulators plan to review the employment and investment promises.

In the meantime, regulators have required the companies to put up a security deposit of cash or credit. The security deposit allows regulators to claw back subsidies if the economic promises go unfulfilled.

LePage’s request would have regulators review those promises more often than once a year. The companies could then keep a lower amount of security deposit on hand.

LePage has railed against “picking winners and losers” with state energy policy, but signed the biomass bailout bill into law, saying he felt coerced into doing so because of the dire economic conditions Maine loggers face and inevitable passage in the Legislature.

Harry Lanphear, a spokesman for the PUC, said the commission is considering the request for more frequent verification of the companies’ claims.

The subsidy arrangement is unusual for the regulatory commission, which noted in approving deals with plant owners Stored Solar and ReEnergy that “the Commission does not typically administer taxpayer funds and we only do so now in accordance with the directives” of the law creating the two-year subsidy.

According to monthly reports, owner Stored Solar had collected $425,998 in subsidies as of Feb. 28.

Stored Solar has proposed a massive $240 million region-wide investment. It has said a refinery making fuel from wood waste at the former Great Northern Paper Co. site in East Millinocket would be the centerpiece of that plan.

Stored Solar has not yet acquired the land, but argued in a lawsuit that it has a right to buy it for $1.75 million. Stored Solar and current owner North American Recovery Management LLC are scheduled to hold a settlement conference before a federal judge on March 27 in Portland.

Representatives of the governor’s office and the Governor’s Energy Office did not respond to questions about what prompted the governor’s letter.


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