Unified vision eludes energy corridor panel

Unified vision eludes energy corridor panel


By Kevin Miller
BDN Staff

AUGUSTA, Maine — Tensions between Maine and Canada over proposed LNG facilities in Passamaquoddy Bay once again have spilled over into efforts to develop regulations for potentially lucrative lease agreements between the state and energy companies.

A 13-member commission reached agreement on most major issues surrounding so-called “energy corridors” but deadlocked Wednesday over whether to extend a moratorium on such projects in response to Canadian opposition to LNG tankers in the bay.

As a result, the Legislature’s Utilities and Energy Committee will receive three competing reports from the commission as lawmakers begin next month debating an energy corridors bill.

“I think we missed an opportunity to be assertive and show leadership and give some solid direction to the Utilities and Energy Committee,” said Sen. Barry Hobbins, D-Saco, a co-chairman of both the committee and the energy corridors task force.

Earlier this year, the Legislature created the commission to craft guidelines to ensure that Maine reaps the maximum benefits from the massive energy infrastructure projects along highway rights of way or through other state-owned land.

Such corridors have been viewed as a potential win-win for the state and energy companies.

Maine could collect tens of millions of dollars in lease payments for energy initiatives while encouraging development of additional renewable energy projects in the state. Energy companies, meanwhile, would have to negotiate fewer obstacles to constructing electricity transmission lines or energy pipelines from Canada to southern New England.

But ever since the spring, discussion of the energy corridors has been dogged by tensions over the Canadian government’s firm opposition to allowing liquefied natural gas tankers to transit Passamaquoddy Bay en route to proposed terminals near Calais.

Commission members’ resolve to protect Maine’s energy interests rose even higher after Hydro-Quebec — Canada’s largest electricity producer — announced plans to acquire New Brunswick Power in order to gain access to U.S. markets.

New Brunswick Power already has transmission lines passing through Maine to southern New England and mid-Atlantic states and is likely to build more if the acquisition is approved. That prospect has raised concerns that Hydro-Quebec could stymie or squash demand for renewable energy from future wind farms or other projects in Maine.

Keith Van Scotter, co-owner of Lincoln Pulp and Tissue, was among the commission members who supports extending the moratorium on energy corridors as a way to pressure Canadian officials to change their stance on LNG in Passamaquoddy Bay.

New Brunswick officials maintain it would be unsafe for the massive LNG tankers to attempt to navigate the narrow passage, with its powerful tides and numerous hazards, in order to reach the proposed sites in Calais or Robbinston.

But Van Scotter and other supporters allege that provincial officials are merely trying to protect a newly opened LNG facility in St. John that is partly owned by New Brunswick-based Irving Oil.

If Canadian companies want to put an “electricity super-highway” through Maine, they should not stand in the way of an energy project important to Maine, Van Scotter said.

“You don’t try to negotiate when you have already conceded some of the things that are important to folks on the other side,” said Van Scotter, who believes a Maine LNG terminal would help lower electricity rates.

But Hobbins questioned the linkage between the issues. He also pointed out that the existing moratorium has been in place for more than six months and Canadian officials have not backed away from their opposition based on safety grounds. On the other hand, too long a delay could cause Canadian energy companies to lose interest in Maine.

“What we are doing is forcing Hydro-Quebec to go through New Hampshire and bypass Maine, and we will lose all of that potential development” and revenue from leases, Hobbins said.

Officials from Irving Oil, which has expressed strong interest in a potential energy corridor lease arrangement, are watching events in Maine closely.

“The only certainty that seems to have come out of yesterday’s decision is that there is still a lot of uncertainty,” said Daniel Goodwin, a spokesman for Fort Reliance, the parent company of Irving Oil. “We are not sure what it means or how it will unfold in the coming weeks and months in the Legislature.”

But Goodwin said Fort Reliance remains interested in working with the state.

David Farmer, spokesman for Gov. John Baldacci, said the governor remains adamant in his conversations with New Brunswick officials that Canada should not stand in the way of LNG projects in Passamaquoddy Bay. But Baldacci believes pursuing energy corridors is also critically important to the state.

“Obviously, we would have preferred to have a consensus or at least a majority report” from the commission, Farmer said. “But we have full confidence, as it heads to the Utilities Committee, that we can find a good resolution.”

All of the reports contain language that would require state regulators to deny any corridor project that does not enhance opportunities for energy generation within the state and significantly reduce electricity rates and energy costs for Maine ratepayers. That language was suggested by Sen. Peter Mills, R-Cornville.

Mills opposed the moratorium as well as the nonmoratorium reports. Instead, he is submitting his own report stating that that any projects “will not impede” development of new energy sources, “including a liquefied natural gas facility on the Maine coast.”

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Comments
7 comments on this item

Why don't we build our own energy corridor. If Canadian companies wish to utilize the corridor they can pay fees to do so. The same as if we have our own energy companies that wish to use the same corridor.

As for safety in the passage of LNG tankers into Passamaquoddy Bay, they shouldn't have anymore problem reaching Calias or Robbinston than the ships that reach Bay Side Marine Terminal in New Brunswick. The US Coast Guard has already said that it is safe enough. That is good enough for me.

In the third world, there is a long history of multinational companies exploiting the countries and their resources. A country blessed with a particular resource remains poor. The people live in shanty towns, save for a small band of rulers who allow the exploiting companies to extract the resources while the people get nothing. These rulers, who sell out their people grow wildly rich. In these countries, such rulers are often sunglass-wearing thugs. In Maine we elect them.

Since the Baldaci administration is in bed with First Wind and wind energy, Canadian power even though it is cheaper would blow a huge hole in the wind energy scam.

The LNG gas terminal is tied into transmission lines . Does this make sense to the average citizen? NO

Canadian govt. states that having the LNG terminal in the Passamaquody Bay is an environmental hazard. It will also harm tourism. (Maine doesn't care about tourism or environment) . The Coast Guard states it is unsafe. Yet the Bangor Daily News prints this article leaving those important facts out.

It is time for clear, honest reporting. That and only that will bring newspaper sales back up. This is yellow journalism.

STOP THE YELLOW JOURNALISM ON THE WIND ENERGY SCAM.

Jaygee...funny

The world LNG industry's own best safe practices for terminal siting indicate Passamaquoddy Bay is eminently inappropriate for such facilities -- as pointed out in "Site Selection and Design for LNG Ports and Jetties" and "LNG Operations in Port Areas," by the Society of International Gas Tanker and Terminal Operators (SIGTTO) -- the organization that represents virtually the entire world LNG industry. In comparison, Canaport LNG's terminal complies with those industry siting standards. The industry is protecting its own reputation and survival by advocating those best practices.

The Coast Guard's Waterway Suitability Report and Letter of Recommendation require the developers to acquire Canada's approval -- something Canada has repeatedly and firmly indicated since 2005 it will not give. The Coast Guard recognizes Canada's authority over its own waters -- a concept lost on the LNG developers.

It is abundantly clear that if Maine wants LNG terminals, the projects must site in industry-compliant locations. By doing so, there would be no objections from Canada, as Canada and New Brunswick have repeatedly stated. So why won't they do it?

The developers would lose face by moving. Plus, they are fulfilling obligations made years ago to their investors, while collecting big paychecks until the permitting processes come to their ultimate conclusions.

Perhaps the developers will not move because they know their projects will not succeed no matter where they are located. There is an oversupply of LNG import infrastructure and a glut of domestic natural gas (around 100-years' worth). Even the Wall Street Journal calls new LNG import projects a mistake.

Maine needs to either move the LNG projects or accept also losing the energy corridor jobs and revenue. Otherwise, Maine will lose out on both.

There is one damned good place for an LNG based project that would have a huge impact. FP & L own the old CMP Wyman station on Cousin's Island in Yarmouth. This generating station was built there because an oil tanker can tie up in deep water 50 feet off the shore in a sheltered harbor. So sheltered that it anchored the North Atlantic Fleet of the US Navy during WWII.

Alas, that plant has not been upgraded and is used as reserve and for peak power loads. When it fires, it is the single greatest source of air pollution in the state of Maine. The infrastructure is there. The transmission lines are already there. The site, less than 100 acres is already developed. It would take about $500 million to destroy the existing plant and build a state of the art LNG conversion and gas fired generating plant. Ten years ago, the Calpine station in Westbrook, 540MW of baseline power (24/7/365, not just a sputtering when the wind blows!) was built for $300 million.

The cleaner burning natural gas would produce less pollution than the heavy oil fired Wyman does now running intermittently. The world is awash with natural gas; it is what has driven costs down. We have to build no new transmission lines or this ridiculous pie in the sky notion of an energy corridor. This is all driven by the mania over wind turbines. Guess what? If all the wind farms were built to meet the state's goal of 2700 MW of installed capacity by 2020, we would still only end up with 675 MW of actual output due to a maximum 25% capacity factor building in wind-poor areas. Yet we would destroy over 300 miles of ridgelines, permanently clearcut over 50,000 acres and wrap Maine up with so many new powerlines it would look like Gulliver lashed down by the Yahoos. A better solution could happen on an already developed 100 acre parcel with deepwater anchorage.

The problem is Baldacci has cronies in the wind industry and doesn't have the balls to lead the state to a single, major impact resolution to an energy "problem" we don't really have.

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