We need an all-resource energy strategy

Despite the warm winter, NH households pay well over 50% more than the national average for electricity and almost 70% more for natural gas

The latest in a long line of studies looking at energy technologies again highlights the need to expand New England’s ability to secure and deliver lower cost energy.

This latest study by the University of Delaware’s Special Initiative on Offshore Wind has a solution. Not surprisingly, the solution it offers is development of offshore wind in the decades ahead. But offshore wind development, while very promising, does little to meet the needs of New Hampshire businesses and industry over the next five to 10 years. 

The latest data from the U.S. Energy
Information Administration reminds us that despite the relatively mild winter, New Hampshire households continue to pay well in excess of 50 percent more than the national average for electricity and almost 70 percent more for natural gas. 

The University of Delaware report follows a variety of other technology or project-focused studies from advocates for natural gas pipelines, other renewable energy resources, electric transmission lines and new power plants. 

The abundance of such studies with competing views has stymied decision-making and has further polarized energy project supporters and opponents who, in most cases, have similar laudable goals – more affordable energy and a cleaner environment. 

Not often mentioned is system reliability, which is likely to become a growing concern as ISO New England, the organization that oversees the region’s interconnected bulk electric power system, warns about future power plant shutdowns (such as the Pilgrim nuclear power plant) and integration of intermittent renewable resources, such as solar and wind, into the power system. 

ISO recently reported that by 2019, 4,200 megawatts of electricity generation will retire, with another 6,000 at risk of retirement by 2020. Alarmingly, this represents nearly one-third of the region’s electricity supply. 

Among the plants ISO identifies as “at risk” are three in New Hampshire: Merrimack, Newington and Schiller.

Renewables and energy efficiency, which the region is already pursuing aggressively, will help fill this gap. But they alone are not enough for businesses and institutions that depend on reliable power around the clock with prices that are affordable, predictable and stable. New England will still need new natural gas-fired power plants to make up for the impeding supply deficit. 

The problem is that the region’s natural gas pipeline system is maxed out. ISO recently noted that 4,200 megawatts of existing natural gas generation are at risk of not being able to get fuel during the winter when natural gas electricity generation competes with space heating. Fortunately, this winter has been unseasonably warm, which masks the longer-range outlook.

A study conducted last year for the New England Coalition for Affordable Energy took an all-resource approach. It assumed aggressive energy efficiency and solar initiatives would continue and a combination of new transmission lines, onshore wind, new gas pipelines and new natural gas-fired power plants would be built over the next few years. These steps, the study found, could help the region avoid $5.4 billion in higher energy costs, with most of those costs hitting consumers in 2019 and 2020.

Many projects have been proposed and are under review that would meet, and even exceed, those levels. But all face strong opposition. 

New Hampshire officials are working with officials in other states to address these issues. Governors have noted the need for new pipelines, transmission lines, wind projects and the pursuit of efficiency and solar. Ultimately, the Federal Energy Regulatory Commission will determine if pipeline projects are in the public interest and meet safety and environmental requirements. Similar reviews are taking place for transmission lines, such as Northern Pass, which is subject to both federal and state approvals.

To avoid the consequences of inaction, the region needs to pursue an all-resource strategy if the region’s energy prices are to become more affordable and energy supplies more reliable. 

Jim Roche is president of the Business & Industry Association of NH. Carl Gustin is a consultant to the New England Coalition for Affordable Energy, of which BIA is a member.