Renewable energy and energy efficiency are, at last, making inroads large enough to cut into national emissions of the greenhouse gases that are causing more destructive climate change. These clean and affordable energy resources are bolstering local and state economies, creating high-tech jobs and making us more energy independent. However, powerful entities with deep dependence on the economic status quo are fighting hard to reverse and retard this vital progress.
The fossil fuel-driven depredations and attacks on solar, wind and other renewables by the Koch brothers are increasingly well-known. Here in Maine, the latest rate proposals promoted in Augusta by Central Maine Power Co. are cut from the same regressive policy cloth. It is no coincidence Koch brother affiliates and operatives — such as the right-wing, corporate-funded American Legislative Exchange Council — are lobbying heavily for similar penalizing fees on renewable energy in state governments across the U.S., notably in Arizona, Kansas and North Carolina.
Yet, as more and more CMP customers take control of the electricity use they once entrusted entirely to their utility, the more CMP — a subsidiary of Spanish energy conglomerate Iberdrola — desperately clings to its lucrative but increasingly out-of-date monopoly. Nonetheless, through energy efficiency, load management and on-site renewable energy technologies or gas turbines, business and residential customers are moving the smart and flexible part of the system to their side of the meter, just as happened over the last three decades in the telephone industry.
Much like a restaurant owner chasing departing customers into the parking lot to collect a surcharge for the salad bar they did not use, CMP wants customers who installed their own generation capacity to pay a new “standby charge” because the grid is there if they want it. This demand is anti-competitive and wrongheaded in several respects.
It seeks to lock in a utility future just like the past, with the grid perpetually maintained by a CMP monopoly with profits more tightly guaranteed than ever. Like it or not, even Edison Electric Institute, the utilities’ trade association, warned its members dramatic changes loom for the utilities’ outdated business model and standard operating procedures.
Five years ago, former Federal Energy Regulatory Commission Chair Jon Wellinghoff saw the writing on the wall that CMP and others refuse to acknowledge. He predicted that even the concept of baseload power, long the stalwart rationale for electric utilities’ monopolies, will fast become a relic: “[I]n fact, most plants running all the time in your system are an impediment because they’re very inflexible. You can’t ramp up and ramp down a nuclear plant. And if you have instead the ability to ramp up and ramp down loads in ways that can shape the entire system, then the old concept of baseload becomes an anachronism.”
Rather than push back the proverbial river, CMP should embrace Wellinghoff’s forecast that, “Solar is growing so fast it is going to overtake everything. … At its present growth rate, solar will overtake wind in about 10 years. It is going to be the dominant player. Everybody’s roof is out there.”
Instead, CMP’s proposal undermines Maine’s successful policies favoring renewable energy. These policies have provided local jobs and taxes while preventing the export of tens of millions of dollars to buy dirtier fuel and energy from out of state. CMP’s plan also double-crosses those who have invested heavily in renewable sources, motivated by the existing policies.
Wise utility regulation emphasizes influencing future expenditures as much as allocating past costs. Maine has been well served by such policies since it substituted in-state energy and energy-efficiency measures in place of endless nuclear reactor cost overruns and cancellations in the 1980s. Successive Public Utilities commissions and legislatures have had no cause to regret their ongoing emphasis on innovation and an open network in the decades since.
At a time when progressive states are evaluating whether power companies — and their state-granted monopoly status — should be reshaped in accordance with technological advances like those that have so dramatically moved telecommunications into the information age, CMP’s “standby” and “capacity charge” rate increases would march Maine resolutely backwards. It’s bad for business and bad for Mainers.
Fortunately, the Maine Public Utilities Commission is beginning to hear beyond the clamor of CMP’s well-heeled lobbyists.
In April, more than 300 customers spoke out against this rate increase plan at public hearings held in Hallowell and Portland. Indeed, according to a new poll commissioned by business advocacy group Alliance for Solar Choice found that eight out of 10 Maine voters — 82 percent — oppose adding a charge on customers who generate their own electricity with rooftop solar or other technologies. Poll results indicate general opposition for a standby charge, which has been proposed by CMP and would require customers to pay an extra fee for being connected to the grid, even when those customers use the electricity that they generated themselves. The survey results show bipartisan opposition to CMP’s standby charge proposal.
CMP’s proposal is part of the utility’s Request for Alternative Rate Plan, under consideration by the MPUC; its request is for a new electric rate structure for the next five years. In addition to the standby charge, CMP also seeks to increase fixed charges paid by all types of electric customers, making it more difficult for residents and businesses to offset electricity bills through conservation or private investments in solar energy.
Before the Public Utilities Commission makes a decision on CMP’s scheme, it needs to hear from these businesses and residents.
Scott Denman lives near Belfast and specializes in energy policy. He has four decades of national and local leadership experience directing clean, affordable, safe energy campaigns, organizations and philanthropic programs.