Is NH ‘closed for business’?

Process for siting energy facilities in the state is cumbersome, inefficient

In 2014, the Legislature amended the laws governing the siting and construction of energy facilities, with the intention of making the siting process more efficient, strengthening public participation in the process, and requiring the Site Evaluation Committee to issue rules that would clarify the criteria used to judge whether a new energy facility should be built.

Monadnock Paper Mills (MPM) followed the SEC
 rulemaking process and filed two letters during
 public comment periods. At the time, the Business
 and Industry Association and many other business groups and employers expressed their collective concerns that the changes to the law and rules might actually hinder rather than promote a balanced process. The evidence to date suggests those concerns were well-founded.

Given shrinking markets for our products and increased competition both domestically and overseas, Monadnock has had to make difficult business decisions in recent years. This reality is compounded by the high cost of doing business in New Hampshire, including high health care costs, high workers’ compensation costs, the business enterprise tax (paid even if the company doesn’t make a profit) and high energy costs.

MPM has a longstanding history of investing in environmental stewardship, sustainable manufacturing processes, energy efficiency and on-site small-scale hydro generation, all in an effort to manage our energy bills, stay competitive and preserve and create jobs. Nonetheless, the mill still purchases substantial amounts of electricity and oil to run our operations.

With respect to the state’s energy strategy, we offer two “guiding principles” to New Hampshire’s policymakers:

 • Preserve and enhance any and all opportunities that help the state’s businesses and residents manage their energy costs and become more energy independent

 • Ensure that the state uses a fair and balanced method to evaluate proposed energy projects that allows for the development of needed infrastructure while providing for public participation

From what I understand, more than 40 years ago the NH Legislature was a national leader in creating a one-stop regulatory review process for the siting of energy facilities that sought to balance critical considerations.

For instance, the Legislature sought to maintain a balance between the timely review of new energy facilities and full consideration of potential environmental consequences, and it sought to establish an efficient adjudicative process that provided for informed public involvement.

But many aspects of the new rules appear to be creating more uncertainty, not less, and prolonging the time needed to resolve issues, rather than streamlining the review.

Of the eight applications to site a new energy facility for which the SEC has issued a decision in the last decade, in only three cases did the SEC issue its decision within the statutory timeframe (and two of those were reliability transmission projects approved by ISO-New England).

The Legislature attempted to make the siting process more efficient in 2014 by reducing the number of members who sit on the SEC and adopting a funding mechanism that would pay for permanent staff. Those changes appear to have led to modest improvements, but did not address a fundamental challenge — a part-time committee is not equipped to handle the full-time responsibilities of acting as judges in complex litigation.

As a consequence, undue delay continues in siting proceedings.

In 2014, the Legislature also increased public participation by adding three additional rounds of public information sessions and public hearings before and after the filing of a project’s application. Public involvement is important and valuable, but it must be balanced against the importance of ensuring the process unfolds in a timely manner and provides the SEC with the information it really needs to make a decision.

In practice, the new sessions seem to be used by opponents of proposed energy facilities as vehicles for protest and not opportunities for exchanging essential information.

The mill remains concerned that provisions in the final SEC rules are being used to erect substantial hurdles to the development of proposed energy projects rather than to objectively evaluate them.

New Hampshire residential, commercial and industrial customers continue to struggle under the weight of electric rates at least 50 percent higher than the national average (as much as 77 percent higher for large energy users). That means less disposable income for working families, higher prices for commercial businesses and a significant competitive disadvantage for manufacturers and other large energy users. I respectfully urge policymakers to make sure that the state does not earn a reputation of being “closed for business” when it comes to siting new energy projects in New Hampshire.

Richard Verney is chairman and CEO of Monadnock Paper Mills in Bennington.