By GARRY RAYNO, InDepthNH.org
The playing field changed in the decade the Northern Pass Transmission Project was before the public with its end coming “not with a bang but a whimper.”
After $319 million was invested in the $1.6 billion, 192-mile, high-voltage transmission line stretching from Pittsburg to Deerfield, Eversource announced Thursday evening the project’s demise by informing investors through an 8-K filing with federal financial regulators.
The utility essentially said the state Supreme Court put the final spike in the coffin in deciding the Site Evaluation Committee did everything it should have to deny the project’s application more than a year ago.
However, pounding nails to permanently close the coffin’s lid began long before the state Supreme Court heard the case.
While Public Service of New Hampshire publicly announced the project in October 2010, the developers had already been before the Federal Energy Regulatory Commission for approval of the project’s financial arrangement among Northeast Utilities, Public Service’s parent company, NSTAR, one of the largest electric utilities in Massachusetts, and Hydro-Quebec.
The financing was approved in May 2009 and again in December 2009 with several changes.
The developers proposed at that time to upgrade the project from 1,200 megawatts to 1,400 megawatts to include 200 megawatts for Brookfield Energy Marketing Inc., a Quebec energy marketing firm based in Ottawa, but ISO-NE denied the request to add the additional power for Brookfield to the New England grid.
At the same time, Public Service was quietly scouring the North Country for land to build a new transmission line from Canada to its existing system, a distance of about 32 miles and the North Country was already nervous.
The project was announced with great fanfare in October 2010 with the promise of jobs and greater prosperity, new tax revenue for host communities and lower electric prices for state residents and businesses.
But as details began to emerge, the opposition grew as did regulatory requirements from federal agencies especially in the White Mountain National Forest where developers needed a Presidential Permit to construct the transmission line.
But when the developers proposed a new underground section from Bethlehem to Bridgewater, including under Plymouth’s Main Street, the public opposition hit a fever pitch with ground zero the small, but vocal town of Easton.
Once the project — the largest construction undertaking in the state since Seabrook Station — was announced there were many steps to take — an environmental impact study, the thousand-page application to the Site Evaluation Committee — and every step was fought on some level from grassroots opposition to state and federal agencies wanting changes.
The project had its supporters, labor unions who wanted the hundreds of construction jobs so their members could work at home and not travel out-of-state, large businesses and chambers of commerce, who all saw the negative effects of the state’s high electricity costs and believed the project would help lower those costs, and economic development groups standing to benefit from the $200 million the proposed Forward New Hampshire plan would provide to offset negative impacts of the project.
The money to offset the impacts would grow over time but so would the opposition which included not just those affected directly by the transmission line, but environmental groups and most notably other electric generators who saw stiff competition and lower returns from the forward capacity market with 1,200 megawatts of new energy entering the market. And the generators had the money to do their own public relations work.
Changing Energy Market
When Northern Pass was first proposed, natural gas prices were higher than they had been in decades with the push to move away from coal to cleaner energy, but a restricted pipeline capacity to bring the fuel to New England.
But fracking changed that, and natural gas prices fell precipitously as did electric prices, making hydro power less of a slam dunk than when the project was proposed.
At the same time a proliferation of wind farms dotted the landscape as multi-national energy conglomerates took advantage of federal tax incentives and the state’s little to no regulations governing wind turbines as power generators.
After a period of stakeholder summits and meetings, lawmakers rewrote the state regulation for the Site Evaluation Committee that approves large utility projects like Northern Pass and wind farms to include much more public and local government input, as well as expanding the membership to include public members not just state agency officials.
The change meant Northern Pass opponents — both grassroots, generators and local officials — would have a much larger impact on the project than they would have had before the changes.
Although transmission lines are a fact of life with electricity, most people experience them as a necessary evil, or “reliability projects” like the recently approved Seacoast project from Portsmouth to Madbury and the Merrimack Valley project, designed to reduce power outages.
However, the Northern Pass project is not a reliability project, but a strictly for-profit undertaking to transport Hydro-Quebec power to renewable energy starved southern New England.
The for-profit aspect was not lost on many of the people impacted who noted the state should not be scarred permanently as an extension cord for southern New England to connect to renewable Canadian power.
An attempt by Eversource, the new name for the merged companies of Northeast Utilities and NSTAR, to reserve some of the Canadian power for New Hampshire ran afoul of the state’s electric deregulation act, so there was little incentive to support the project.
Changing North Country
Most people know there really are two New Hampshires: the prosperous triangle from Nashua to Concord to the Seacoast and the rest of the state which has not experienced the same robust economic activity.
The region that struggles the most is the North Country or the land above the notches. That area’s economy has never recovered from the closure of its paper mills, but its real estate market has changed in the last decade.
Many retired people with significant resources bought property with mountain views and invested in nice homes.
Unlike those in the struggling economy, these folks have the time and resources for a serious battle to prevent 100-foot transmission towers from impacting their pristine views.
When the SEC voted 7-0 to deny the project, the members cited the lack of sufficient and credible evidence for committee members to make an informed decision on the project’s impact on property values, local businesses, tourism and changes in land use.
The lack of evidence and credible witnesses failed to make the company’s case the project would not unduly affect the orderly development of the region, according to SEC’s decision to deny the project.
Several of Eversource’s expert witnesses did not help the utility’s cause.
The tourism expert did not know where Portsmouth or Keene were in relation to the project, while the real estate expert did a “windshield study” to determine there would only be property value impact within 500 feet of the transmission line.
And the financial expert predicted large economic benefits from the forward capacity market, which other experts said would be much smaller and questioned if the additional power would be able to go onto the New England grid without removing the output from current generating facilities.
When Eversource’s appeal of the SEC’s decision denying the project was before the Supreme Court, Chief Justice Robert Lynn noted the company appeared to have the attitude if it made the application, the SEC had to find a way to approve it.
The chief justice told Eversource officials that was not the case.
Northern Pass is only the second major utility project the SEC has denied, the other Antrim Wind, which regrouped and ultimately won approval for a revised project.
The possibility of reapplying in a different configuration was floated by Eversource New Hampshire President Bill Quinlan after the Supreme Court’s oral arguments, but Thursday’s federal filing ends any speculation about that sending champagne corks flying in communities along the 192-mile route.
The First Nail
If the final nail in the coffin was the Supreme Court’s decision, the first nail in the coffin was driven in a board room in Hartford, Connecticut.
The project’s essential decisions were made at Eversource’s headquarters in Connecticut not along the banks of the Merrimack River in Manchester.
Most observers believe if Eversource had been willing to bury the line down the I-93 corridor, it would have been approved today, but that suggestion was dismissed by Eversource as too expensive and that is telling.
Northern Pass was designed to maximize profits, not New Hampshire’s best interests and that is why there is “no way forward.”
Garry Rayno may be reached at email@example.com