An Unconstitutional Bill from the Negawatt Naysayers

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Donald M. Kreis, New Hampshire Consumer Advocate

Power to the People is a column by Donald M. Kreis, New Hampshire’s Consumer Advocate. Kreis and his staff of four represent the interests of residential utility customers before the NH Public Utilities Commission and elsewhere.

By DONALD M. KREIS, Power to the People

If our state’s Energy Efficiency Resource Standard has a future – and, as the state’s ratepayer advocate, I’m here to say it should – we just might have Jagdish Rai Chadha, a former Kenyan exchange student, to thank.

Let me explain.

Forty-nine year ago, Chadha was pursuing a master’s degree at Bowling Green University in Ohio when his visa expired.  He had a problem: newly independent, Kenya wouldn’t take him back because his parents were from India and, thus, British subjects. India wouldn’t take him because he was Kenyan.

Here in the U.S., immigration authorities began deportation proceedings. Then the authorities suspended the deportation under a federal law that allowed Chadha to stay in the U.S., but only if neither the House of Representatives nor the Senate vetoed the bureaucrats’ decision to stay the deportation.

The House passed such a veto resolution. Deportation proceedings resumed. Chadha appealed.

The result was a landmark ruling in 1983 by the U.S. Supreme Court.  The Court declared the so-called one-house legislative veto to be in violation the “bicameralism” and “presentment” clauses of the U.S. Constitution.  Basically, the only way Congress can make law is by having both chambers pass identical legislation (“bicameralism”) and then present the bill to the president for signature or veto (“presentment”).

What the heck, you might wonder, does that have to do with ratepayer-funded energy efficiency in New Hampshire? I’m glad you asked.

The New Hampshire House votes this week on HB 351, which would drastically and permanently curtail the ability of the Public Utilities Commission (PUC) to increase the System Benefits Charge (SBC) on your electric bill. 

Some of the SBC pays for bill assistance for low-income customers.  But the rest provides the bulk of the revenue for NHSaves – the programs electric and natural gas utilities provide to meet the Energy Efficiency Resource Standard (EERS).

The EERS is a great deal for ratepayers.  Why?  Because there’s a rigorous cost-benefit test.  Every penny spent by NHSaves must deliver net benefits to all customers (not just those smart enough to take advantage of the programs).

Energy efficiency also stacks up really well against the alternatives.  “Negawatts” – getting more work out of each unit of energy consumed – are cheaper than megawatts (producing and distributing more electricity) when it comes to meeting the next unit of demand.

But the EERS has its ideological opponents in the Legislature.  They argue that if energy efficiency were such a great idea then customers would simply invest in it themselves.  They contend that the System Benefits Charge is the equivalent of a tax (even though the government neither collects, holds, nor spends the money).

The negawatt naysayers are about to prevail.  The House votes this week on HB 351, which squeezed through the Science, Technology and Energy Committee on an 11-9, party-line vote.

If HB 351 becomes law, PUC approval of increases to the System Benefits Charge will no longer suffice.  After endorsement from the regulators, such increases would only go into effect if approved by either the Legislature’s Joint Fiscal Committee or via regular legislation.

In other words, just as one chamber of Congress could overrule the Immigration and Naturalization Service (now known as ICE, Immigration and Customs Enforcement) on the deportation of Jagdish Rai Chadha, so now will one chamber of the New Hampshire General Court or even just a committee of the General Court be able to overrule the PUC on matters related to energy efficiency.

What an awful idea.  New Hampshire lags behind the rest of New England on energy efficiency, which means we are ceding all kinds of economic advantages to our neighbors.  Energy bills are higher than they would otherwise be as a result.

But it’s also unconstitutional, as the U.S. Supreme Court declared in its Chadha decision.

Of course the skeptical will point out that Chadha arose under the federal constitution, whereas it would be up to the New Hampshire Supreme Court to determine whether HB 351 violates the New Hampshire Constitution.  But that document is modeled on its federal counterpart and contains similar bicameralism and presentment language.  There is no reason to suppose the New Hampshire Supreme Court would reject the Chadha precedent.

The skeptical might also claim that HB 351 isn’t a one-house veto because the Legislature can approve an SBC increase via a bill adopted in both chambers and presented to the Governor.  But when you think about it, that’s the functional equivalent of a one-chamber veto of a PUC decision.

Government is not supposed to work that way, under either our federal or state constitutions.  Here’s what is supposed to happen.

The Legislature can set utility rates, including the System Benefits Charge, all by itself. Or it can choose to delegate that authority to an administrative agency – here, the Public Utilities Commission – with instructions to guide the regulators.

What the Legislature can’t do is delegate the authority, require supporters of energy efficiency to go through the regulatory process, and then require them to come back to the Legislature for lawmakers’ blessing.  That’s inconsistent with the New Hampshire Constitution – or, at least, so I will argue to the New Hampshire Supreme Court if necessary.

Please help make that unnecessary.  Call or write your House member before Wednesday and ask them to reject HB 351. 

You can find your House member and contact information here.

You can watch the House sessions April, 7, 8 and 9 here.

Ratepayer-funded energy efficiency is officially in crisis here in New Hampshire.  With HB 351 looming, the PUC has so far refused to approve the three-year energy efficiency plan that was supposed to go into effect on January 1 – more than three months ago!

The regulators know the negawatt naysayers are on the brink of prevailing.  But energy efficiency is a good deal for ratepayers, so it’s time for the ratepayers to speak out.

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