N.H. wood industry’s renewable energy efforts tangled up in legislative wrangling

Attempt to change renewable standards finds itself caught in the tug of war over Obamacare

A renewable energy bill supported by the New Hampshire wood industry might end up being a casualty in the ongoing battle legislative dogfight over Obamacare.

Senate Bill 148 centers on how much biomass-produced energy utilities would need to buy to meet the state’s renewable energy standards and how much they would have to pay if they don’t meet the standards.

The wood industry has long lobbied for strong requirements, but these tougher requirements backfired, because of the regional nature of electricity, and the variation in standards and penalties (called alternative compliance payments) in individual states.

As a result, wood-burning plants make more money selling their energy to out-of-state utilities – notably Connecticut — and New Hampshire utilities find it cheaper to pay into the state’s Renewable Energy Fund than buy wood locally.

This has been great for the Renewable Energy Fund, which has found itself with some $19 million — about ten times more than it had the previous year (though being so flush has made it an inviting target as lawmakers try to hammer out the budget. Indeed, the Senate budget bills calls for a $15.5 million raid on the fund.)

SB 148 would drastically reduce the biomass energy requirement from 6.5 percent to 1.4 percent next year, though that percentage would creep up again. The lower requirement would help utilities that can’t really meet the current standards and perhaps lower rates.

It would also reduce the Renewable Energy Fund so it wouldn’t be such “a big bull’s eye,” in the words of Jasen Stock, president of the New Hampshire Timberland Owners Association.

The key for the wood industry would be an increase in the alternative compliance payments that would put New Hampshire more in line with other state.

But all the changes have been put into jeopardy when the House added an amendment pertaining to regulation of the health insurance market – a move made after the Senate had earlier nixed a similar measure.

The amendment doesn’t require that the state expand the federal offer to expand Medicaid, nor does it accept the federal offer to pay for consumer assistance to help previously uninsured people navigate the complicated system of deductibles and copays. Instead, it gives the state Insurance Department the right to regulate the insurance market, including the new health exchange.

Rep. Ed Butler, who heads the House Commerce Committee and is on the conference committee for the newly expanded SB 148 — said he is confident that a compromise can be reached on this issue, allowing the renewable energy bill to pass. However, there are senators on the other side have been steadfastly against any accommodation with Obamacare.

So the Senate tacked the language of SB 148 onto another renewable energy bill, House Bill 542, which had largely been a technical update of the standards after two controversial provisions had been worked out.

An attempt to classify as renewable energy produced by trash incinerators, to help the Claremont waste-to-energy plant, was dropped. And an attempt to deny the Concord Steam plant renewable energy credits for using the steam that produced electricity as a hearing source for the city of Concord and nearby industry survived.

Nevertheless, Butler is confident that SB 148 will make it through on both bills. But Stock wasn’t so sure.

“We are holding our breath,” he said.