Closed door at the end of energy corridor
Guest Column

Closed door at the end of energy corridor


By John Hanson

In the May 16 editorial “Energy Access Worries,” the Bangor Daily News got it right when it wrote “second place is as good as last in these sorts of considerations.”

Those of us who are part of the Maine Jobs First coalition couldn’t agree more, especially during these troubling economic times when some of our state’s policy leaders are actually considering a proposal that would export new jobs to Canada by developing an “energy corridor” through Maine.

This energy corridor would essentially carry Canadian-produced energy to lucrative markets in southern New England states, diminishing the value and need for proposed energy projects right here in Maine. These energy projects in Maine include potential offshore wind and tidal power proposals and the development of liquefied natural gas terminals in Washington County, where the current economic crisis felt in other parts of the state pales in comparison.

Washington County has been plagued for more than 30 years with an economic malaise that includes job losses, poverty and a dwindling, aging population. Unemployment has reached 13.9 percent, and that’s before Washington County’s largest employer — the Domtar mill in Baileyville — closed its doors, putting more than 300 people out of work.

Washington County has a poverty rate higher than any other county in Maine. Median household incomes and home values in Washington County were roughly 29 percent lower in 2007 than the statewide average. Washington County also leads in childhood poverty — near 29 percent of its children are living below the poverty line.

But it doesn’t have to be this way.

Because of its unique geographical location and available work force, Washington County also is poised to become a thriving and sustainable energy hub for Maine that could create hundreds of long-term, well-paying jobs that would still be around long after the construction of these facilities is completed.

The province of New Brunswick certainly understands the benefits of creating its own energy hub. According to the New Brunswick government, energy projects being considered or constructed in the province included a liquefied natural gas terminal and pipeline; a refurbishment of the Point Lepreau nuclear power facility; the potential construction of a second nuclear power facility and a second oil refinery. This $19 billion investment was estimated to create $44 billion as the result of direct, indirect and induced spending related to the construction of these facilities.

Combined, New Brunswick’s energy projects are estimated to create 33,000 new jobs and generate an additional $14.2 billion in total tax revenue for the province over a 10-year period.

Imagine if this were happening in Washington County.

A 2005 report from a task force led by David Flanagan points out that one of the most promising sectors for Washington County’s economy is the potential to help meet the nation’s growing energy needs. “Washington County will benefit directly from the construction and operating jobs and the tax revenues, and possibly reduced energy costs such new development can bring,” the report states.

In fact, an economic analysis of just one of the energy projects being proposed in Washington County shows that an $800 million investment in construction of a liquefied natural gas terminal could create nearly 1,000 jobs during the peak of its construction and create between 120 and 150 new, permanent jobs in Washington County.

Despite overwhelming support from people in Washington County, the biggest threat facing this LNG project is coming from the other side of the border, where Irving Oil Co. and its partners are putting the finishing touches on their own LNG facility.

It’s not hard to understand why the Canadians don’t want competition, but it’s ridiculous to think that we would then allow them to use our state as a delivery platform so they can sell their energy to business and residents in Connecticut and Massachusetts.

When considering this energy corridor, we must ask ourselves what’s in it for Maine, other than some relatively short-term construction jobs, which while important, pale to near insignificance when examined against the longer-term possibilities.

New Brunswick has done an enviable job of creating an energy hub to address their increasing energy demands and provide a measure of self-reliance in today’s tumultuous energy marketplace.

There is no good reason why Maine should not be able to do the same thing, and keep all the benefits, not just the scraps. After all, in this debate being second is exactly like being last.

John Hanson is the executive director of the Maine State Building and Construction Trades Council and a member of Maine Jobs First (www.mainejobsfirst.com).

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Comments
5 comments on this item

Don't underestimate those wily Canadians. Look at what they've been able to do with NAFTA. They're survivors!

I am surprised at the stance taken by John Hanson in his op-ed piece in todays paper. Hanson is the director of the construction trades council and writes in opposition to the proposed energy corridor which would be a co-operative effort between Maine and New Brunswick. While I applaud his efforts to protect jobs in Maine I have to question his knowledge of the state of natural gas in this country. He speaks to the proposed LNG projects in Washington County as if they would be a done deal if only Canada would allow the tankers to come through their waters. In fact Canada is only one of the projects problems. While environmental and safety concerns are important considerations the biggest obstacle to the facilities is that there is simply to much natural gas around. New discoveries have produced a glut of gas in North America to the point where many U.S. LNG facilities have applied for permission to export gas.! A facility on the Texas-Louisiana coast which was built to receive several tankers a month has only seen one delivery for the past eight months. They too have applied for a license to export gas to other countries. Even the Canaport LNG terminal in New Brunswick which is set to take its first delivery early this summer has doubts about how much they will be able to receive because of the huge supply of domestic reserves. Energy experts have said that the Canaport facility could not be operating at a worse time. They stated that "instead of being short of natural gas, North America is in another glut." With these facts in mind the question is why would Mr. Hanson risk threating all those jobs which his unions - would benefit from and put his eggs in one basket which has such a dubious future. If he and his Jobs First members cannot give an honest answer to these question then there is something stinking here and it is not natural gas.

Many of the key facts Mr. Hanson uses to promote his argument are incorrect. He overstates the numbers he cites of jobs that would be created by the LNG proposals on both temporary and long term bases. One extensive study by the Yellow Wood Group concluded there would be a net gain of about 8 jobs once the damage to existing economic activity is factored in. In addition, as evidenced by the plan by one developer to construct a large labor camp to house temporary laborers from other regions (Indonesia is Haliburton's latest favorite), the true benefit to local workers would be minimal.

Also, his claim that the proposed projects command "overwhelming support" is wildly off the mark. One project was defeated soundly at the polls when it was presented to the voters for approval in 2005 and independent survey results conducted by the Washington County Council of Governments in 2007 revealed that 65% of homeowners in two impacted towns were opposed to LNG.

He also mischaracterizes the 2005 Flannagan Report that determined that the best hope for Washington County was in using its unique characteristics to develop the growing tourism and housing markets, which would be set back dramatically by allowing these heavy industrial proposals to go forward.

LNG is a highly speculative industry that has crashed and burned many times since the process was originally developed over 60 years ago. Washington County does not need to tie its future hopes to the wildcatting developers that are promoting these dubious projects. By anchoring his argument against the Canadian energy corridor to support for the LNG promoters, Mr. Hanson finds himself tied to a gas filled balloon that may take him far out to sea. His union members deserve a more stable approach.

mrmxyzptlk, yes there may be a glut at the moment on natural gas in the world market. That very well be a direct result in the global slowdown that was brought on by the gouging that we were subjected to by the Oil Speculators. This will pass and the demand will rise again. Will we be caught again flat footed with no alternative energy sources?

The Irving Companies have a right to operate their many business interests as they see fit. But please don't believe that they have the consumer's best interest in mind, except as a revenue source for them. I do believe that they are the money behind the opposition from Canada to allowing any development in Washington County that doesn't have Irving oil logos attached.

Having read the article by Tux Turkel in BDN May 21 issue, I became fairly PO'd by the threats made by big business to us that they will bypass Maine if they don't get their exclusive use of our state as a corridor to run their power sources from Canada to the big market areas of Mass, Conn. NY, etc. Who do these people think they are? Are we just going to sit by and let them use us as their doormats?

I do believe that both of our Senators have gained a fair amount of Seniority in the Senate and should bring the full brunt of that power to bear against any legislation that might benefit any company threatening the livelyhood of this State. I would think that if these companies want to utilze the stimulus packages being offered by this country they might need the co-opereation of one or both of our Senators in the future. What goes around comes around.

Please write, call or e-mail our representatives in Washington and SHOUT your displeasure with being treated like dirt.

Did anyone consider the option of tying into the "New Brunswick" funded pipeline to deliver Maine produced energy? Instead of apposing the pipeline, Maine should see it as an opportunity. After all, NB icompanies are asking to partially fund a project through Maine. I see no reason why Maine couldn't use it as well.

Opposition to it smells of protectionism and small-mindedness. Neither of which works, and is hypocritical. After all, America, like most western countries, would not bbe what they are without "cheap" imports from other countries, or without the exports of manufactured goods and food that make America wealthy.

Take the opportunity.

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