Northern Pass Op-Ed: Mr. Quinlan: Tear Down This Wall

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D. Maurice Kreis, New Hampshire's Consumer Advocate

D. Maurice Kreis is New Hampshire’s Consumer Advocate. He and his staff of four represent the interests of residential utility customers before the NH Public Utilities Commission and elsewhere.

By D. Maurice Kreis,
New Hampshire’s Consumer Advocate

Resting comfortably, in a manila folder in my office, is an intriguing and much-talked-about document.  Unfortunately, I cannot show it to you.

Entitled “Power Purchase Agreement by and between Public Service Company of New Hampshire d/b/a Eversource Energy as Buyer and Hydro Renewable Energy Inc. as Seller,” it is the contract through which Eversource claims to have snagged for its New Hampshire customers some tangible financial benefits from its controversial Northern Pass transmission project.  The deal now has the dubious distinction of having been rejected twice:  first by the Public Utilities Commission and, most recently, by the Legislature.

Eversource might quibble with my characterization of what happened at the State House.  Officially, the House Science, Energy and Technology Committee voted on May 9 to retain Senate Bill 128.  Had the House followed the Senate’s lead in adopting SB 128, the Governor would likely have signed the bill and, with the stroke of a pen, the Power Purchase Agreement would be permissible under New Hampshire law.  The PUC had ruled it couldn’t even consider such a deal because it is inconsistent with the state’s electric industry restructuring law.

Ever the rational and self-interested actor, Eversource sought to spin the refusal to report the bill out of committee as a victory.  Bill Quinlan, president of Eversource’s New Hampshire operations, said in a statement:  “We understand the importance of considering this proposed legislation carefully. We are committed to continuing to work intently with the NH Legislature, the PUC, and other parties to identify solutions for delivering much-needed energy rate relief for our customers.”

Quinlan stressed that the Committee could take up the bill later this year and report it to the floor at the start of the next legislative session in January.  That’s true enough.  But it means there’s no way the Power Purchase Agreement (PPA) could gain approval in time to influence the Site Evaluation Committee (SEC) as it considers whether to grant Northern Pass its land-use permit.  The SEC’s hearings on Northern Pass wrap up in three months.

The Eversource press release also includes this vexatious comment, attributed to Steve Demers, a Hydro-Quebec vice president:  “We stand by our commitment to our New Hampshire neighbors, and look forward to delivering the benefits of the PPA in the future, should such an opportunity arise.”  Hydro-Quebec, of course, is both the proposed user of Northern Pass and the parent company of the entity that signed the PPA to entitle Eversource New Hampshire to 100 megawatts of on-peak power via the transmission line.

Those “benefits of the PPA,” they are claimed entirely on a trust-me basis.  That’s because Eversource is taking advantage of the PUC’s confidentiality rules to keep the terms of the PPA a secret.

As the official advocate for residential utility customers, the Office of the Consumer Advocate has an unredacted copy of the PPA.  We have the redacted portions of Eversource’s written testimony analyzing the terms of the deal.  And we have a copy of the detailed analysis Eversource commissioned from London Economics International with all the secret stuff included.  We just can’t share this information or talk publicly about it.

We have this stuff because the statute creating our office says the utilities have to give us everything they file with the PUC.  We can’t share it with you because the statute also says that as long as the PUC treats the information as secret we must too.

Ordinarily, this system works pretty well.  We (and the Staff of the PUC) receive everything the utility has, right from the get-go, which allows us to prepare for hearing. The confidentiality questions are deferred to the end of the case.  Since the purpose of the Right-to-Know Law is to help the public understand what the government is up to, it makes sense for the PUC to resolve what’s public and what isn’t through the lens of what evidence in the record forms the basis of what the PUC actually decided.

In this situation, however, that logic falters.  The PUC’s decision that the PPA is legally impermissible may or may not be appealed.  The Legislature’s decision not to take up the question may or may not be revisited.  Meanwhile, as the Northern Pass hearings at the SEC reach their critical juncture, Eversource and Hydro Quebec talk about the benefits of their PPA without having to prove what those benefits are.  And we, tasked with skeptically assessing those benefits on behalf of the customers who will allegedly receive them, are completely muzzled.

This is a job for the PUC, which should depart from its customary practice and rule now on the long-pending motion for confidential treatment of the unredacted PPA.  Longstanding guidance from the New Hampshire Supreme Court says a balancing test applies; the PUC must decide whether the privacy interests of the parties to the PPA outweigh the public’s interest in disclosure.  Even if you buy the claimed privacy interests (which we do not, given the unique circumstances of the deal), this is surely that rare case in which the public has such a compelling interest in disclosure that denial of the confidentiality request is warranted.

More fundamentally, this is a job for Bill Quinlan.  As the utility’s top official in New Hampshire he should know it’s time to convince his superior officers at Eversource headquarters, and his counterpart in Montreal, that they should go public with the terms of this deal.  Merely building Northern Pass secures nothing definitive for New Hampshire because, apart from that 100 megawatts in the Eversource PPA, Hydro Quebec plans to sell all of the power that will flow via Northern Pass in Massachusetts to satisfy aggressive requirements there for renewable energy.

There is nothing competitively sensitive about this deal – it’s a classic one-off.  In its redacted form, the PPA is nothing but a publicity stunt.

 

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