December 03, 2019
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Recent storms make case for consumer-owned utilities

Bill Trotter | BDN
Bill Trotter | BDN
Sargent Drive is blocked next to the golf course in Northeast Harbor by a tree hanging on power lines and cables on the roadway following the Oct. 17 wind storm. The storm knocked out power to more than 5,000 Emera Maine customers on Mount Desert Island.

Within a day-and-a-half of the Oct. 17 nor’easter, the customers of Maine’s eight consumer-owned utilities had their power back. It took investor-owned utility Central Maine Power five days to hit the same benchmark. Our other investor-owned utility, Emera Maine, took four days.

For customers and regulators, this difference matters. Large or small, each utility must maintain an adequate workforce and mutual-aid agreements to keep your power on if possible, or to restore it quickly if not.

Maine’s consumer-owned utilities serve all or part of 97 Maine municipalities. They stretch from Calais to Kennebunk, and from Van Buren to Vinalhaven. They serve rural, suburban and island communities.

Our largest is Eastern Maine Electric Co-op. Its Down East territory is twice the size of Rhode Island, with many trees. At the peak of the Oct. 17 storm, 40 percent of its customers were without power. Within a day, that number was down to about 1 percent.

Fewer than 30 percent of CMP and Emera Maine customers were without power at the peak of outages, yet these restorations took several days.

In recent years, CMP and Emera Maine have earned Maine the worst-in-nation track record for outages, and some of the highest rates. Both blame trees and geography. This is fair, to a point. But as Eastern Maine Electric Co-op shows, good service has more to do with good management.

To compare utilities large and small, regulators measure the frequency and duration of outages. In theory, outage restoration rates should be comparable whether the utility serves 10,000 customers or 10 million. Yet both in Maine and nationally, consumer-owned utilities outperform their investor-owned counterparts.

This coming winter, state legislators will vote on LD 1646, a bipartisan bill to establish a Maine Power Delivery Authority. A large consumer-owned utility, Maine Power would purchase the wires of CMP and Emera Maine, financing these affordably against future rates.

Like all Maine consumer-owned utilities, Maine Power would be separate from the state, and barred from using state tax dollars.

Maine Power would restore local control and reduce the costs to meet our future energy needs. Its board would be confirmed democratically. Their meetings would be public. Fiduciary responsibility would be to customers, not shareholders.

Maine Power would be organized as a “muni,” similar to a typical, nonprofit water district. To finance infrastructure, munis issue low-interest, tax-exempt bonds. This affordable financing keeps rates lower, and well-paid workers ready to prevent and repair outages.

Consumer-owned utilities like Maine Power already serve 1 in 7 Americans, in 49 states. Not all are perfect. But on average, their customers pay 13% less than investor-owned utility customers, and spend half the time per year without power.

Unlike investor-owned utilities, they are also eligible for federal aid after windstorms.

But why does it really matter who owns our electrical grid? It matters because the grid is the foundation for our future.

First, more severe weather requires a harder, more resilient grid. Maine Power will help us do this work most effectively and affordably, avoiding more botched jobs that still double investor-owned utility profits.

Second, to power our vehicles and heat our buildings cleanly by 2050, our grid needs a systems and management makeover — a smarter, stronger design costing multiples of our grid’s current value. Low-interest capital is crucial.

Instead of fighting decentralized solar, storage, efficiency or non-wire alternatives such as the Boothbay Project, Maine Power will embrace and encourage such resources.

Looking at consumer-owned utilities serving 40 towns in Massachusetts, a recent study found their greenhouse gas emissions to be 60 percent lower than that of the state’s investor-owned utilities. The consumer-owned utilities’ rates per kilowatt hour were also 42 percent lower.

Maine’s energy overhaul will succeed only if it does not raise costs to industry, to our lower-income neighbors and to the middle class.

Maine can gain in this transition. But it will not be easy as some pretend.

In three decades since Al Gore’s first book, humanity has burned more fossil fuels than in our entire previous history. Trusting in technology to save us, we have accelerated toward the cliff.

Climate change is a generational challenge. As oceans rise and headwinds stiffen, the grid is the foundation of the clean economy we must now build for our children’s future. Let’s build it on proven, bedrock practices and principles — not the shaky grounds of speculators and profiteers.

Rep. Seth Berry, D-Bowdoinham, is House chair of the Legislature’s Energy, Utilities and Technology Committee.

 



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