BERLIN – Burgess BioPower, the wood-fired power plant in Berlin, has terminated the Power Purchase Agreement governing the sale of power to Eversource and is filing for bankruptcy, according to a Burgess news release.
The release said the action followed Eversource’s failure to make required payments to the company, which Eversource denies.
Burgess said operations and energy generation will continue during the restructuring process.
Eversource sent out its own news release.
“Eversource is not in default of the contract and rejects Burgess’ unilateral termination of the Power Purchase Agreement, as well as any claims that our adherence to the terms of the contract forced its bankruptcy,” according to its release.
Eversource said it is pursuing mediation to get the $71 million in over-market prices paid to Burgess for their energy over the last several years, with all of those collections going directly to customers.
Eversource said last month it began reducing payments to Burgess Biomass as agreed to both parties in 2011 and approved by the Public Utilities Commission as being in the public interest.
“This contract requires reduced payments to Burgess for the plant’s output for approximately $71 million in above market purchases made to the plant over the last three years. Last year, policy makers rejected legislation that would have forgiven the $71 million, and we are required to enforce the terms of the PPA,” Eversource said.
Eversource said it does not profit on the contract with Burgess Biomass and any savings from reduced payments under the terms of the contract will flow to customers through a decrease to the Stranded Cost Recovery Charge.
Saying “enough is enough,” Gov. Chris Sununu last year vetoed legislation that would have continued Burgess’ subsidy.
Last August when Gov. Chris Sununu vetoed HB 142, he said, “New Hampshire ratepayers have been taken for over $200 million in order to subsidize the Burgess Biomass Plant in Berlin.
“After accounting for overmarket energy costs and Renewable Energy Certificate costs, Burgess Biopower has received over $200 million in subsidies since 2014. $200 million to support fewer than 40 full time jobs! All of these overmarket costs are paid by approximately 530,000 Eversource customers, forcing those families and businesses to bear additional unnecessary financial burden on top of already historically high electric bills,” Sununu said in his veto.
Sununu said the best idea from Burgess to keep the plant going “is to ask the state to forgive the approximately $70 million that the plant owes back to ratepayers.”
Donald M. Kreis, the director of the Office of Consumer Advocate, called Burgess’ actions “outrageous and disappointing.”
“What is striking about the announcement from Burgess BioPower is the lack of any reference to the $70 million the company owes to Eversource’s ratepayers in New Hampshire.
“Ratepayers have been lavishly subsidizing the operation of the biomass plant at the site of the former paper mill in Berlin for more than a decade, and now the plant’s owner apparently intends to walk away from its obligation to ratepayers.”
Burgess is filing bankruptcy in Delaware, not New Hampshire.
“Yet Burgess BioPower has the nerve to proclaim itself a ‘trustworthy community partner.’ This of course is an outcome of the Governor vetoing the latest Burgess BioPower Bailout Bill last year. Enough is enough, he said then — and he was right. With ‘trustworthy community partners’ like these, who needs enemies,” Kreis said of Burgess.
In the Burgess release, the company said it remains committed to people in Berlin and the Granite State.
“The restructuring process will permit the Company to continue the production of reliable, renewable energy while creating a sustainable path for Burgess’s long-term operation,” said Sarah Boone, their spokesperson. “We are confident that the Company will navigate the process smoothly and successfully.”