Renewable energy bills spark controversy in the Legislature

During its recently concluded 2006 session in Concord, the Legislature considered a number of energy-related issues, but didn’t pass some of the most controversial energy bills.

Two that garnered significant attention but were not passed by lawmakers concerned the establishment of a renewable energy portfolio standard, or RPS, and authorization for Public Service of New Hampshire to acquire or construct and operate a wood-fired power plant in the North Country.

The renewable energy portfolio bill would have required that electric utilities purchase a certain percentage of their power from renewable energy generators, with one of the biggest issues being what constitutes a renewable energy generator and what the parameters constitute renewable energy.

Debate came down to concerns about impact on ratepayers. Many legislators did not want to subject ratepayers to additional charges that would be used to pay for these incentives, while proponents argued it would be an economic boon to the state and reduce dependence on foreign sources of energy. While a number of other states have passed similar laws, there is not one standard or model legislation that all sides could support.

The PSNH proposal ran into objections from merchant electric generators who were concerned about the impact on the competitive market in New Hampshire if the utility were allowed to recover the costs of acquiring or constructing such a generator from its ratepayers.

Supporters of the bill argued it would help the battered economy of the North Country and that it was too small to have much of an impact on the competitive market. Various forms of the PSNH amendment were offered on a few different bills, and though a version ultimately passed the Senate that would have allowed PSNH and others to bid on such a project for the North Country, the amendment adopted by the Senate ended up before a committee of conference at the end of the session, where it died during negotiations after one member of the committee, House Majority Leader Mike O’Neil, refused to sign the conference report.

In other energy-related action:

• The Legislature passed a bill that authorizes municipalities and renewable energy developers to enter into payment in lieu of tax agreements allowing the generator to pay local property taxes at a different rate or manner than other property-tax payers. In passing the law, the Legislature said that it was in the public interest to remove impediments to preserving, expanding and improving existing renewable generation facilities in the state and to developing new facilities, and that the property assessment practices, procedures and methodologies can be an impediment.

A similar law was on the books for a number of years, but was repealed in the late 1990s.

• The Legislature set up a state energy policy commission to study a number of energy issues, including the regulatory process for siting wind power facilities, renewable portfolio standards, the adequacy of electricity supplies to meet demand, the adequacy of natural gas supplies, and the divestiture of PSNH generation assets.

• Rep. Neal Kurk unsuccessfully sponsored an attempt to establish an electricity transmission utility property tax, eliminating the electricity consumption tax and using some of the money from this new tax to pay for the New Hampshire Land and Community Heritage Investment Program. The Legislature also defeated attempts to either implement or study further the issue of global warming through the Regional Greenhouse Gas Initiative, a cooperative effort by Northeastern and Mid-Atlantic states to reduce carbon dioxide emissions that cause global warming.

• The Legislature passed a bill that will require PSNH to clean up emissions from the coal-fired Merrimack Station in Bow over the next few years. PSNH supported this bill, which provides for an 80 percent reduction of mercury emissions from coal-burning power plants by requiring the installation of the best known commercially available technology — what the bill refers to as a wet flue gas desulphurization system, or scrubber technology, no later than July 1, 2013.

• In a bill that was a carryover from the 2005 session, the Legislature defeated an attempt to limit or eliminate the exemption that utilities and others receive from local property taxes for pollution control facilities. This bill resulted from a dispute between the town of Bethlehem and a landfill operation over such an exemption. Later versions of the bill broadened its application to have an effect on merchant electric generators and utilities, as well as other businesses, before it was killed in the House.

Doug Patch, a former chairman of the state Public Utilities Commission, is an attorney with the Concord law firm of Orr & Reno. He worked as a lobbyist on some of the legislation mentioned in this article.