Tuesday, January 31, 2012

A Tribute to North Country Landowners

Bury the Northern Pass joins with Bob Baker (Columbia, NH) in paying tribute to the brave and selfless landowners of Coos County who value landscape, heritage, and community over private gain.

Open letter to the landowners of Coos County who are refusing to sell out to Northern Pass:

It was just one year ago that Northern Pass was telling the public and its investors that the 1200 MW High Voltage Transmission Line it was planning for Hydro Quebec would be constructed on the backs of New Hampshire landowners in 2013; and that the new transmission line would be in service by 2015.  However, the fact is that Northern Pass is no further ahead in building this ill-conceived project than it was a year ago. Its application for a Presidential Permit is frozen in place with many scoping steps yet to be accomplished before an Environmental Impact Statement can be designed and prepared. In fact, Northern Pass is so far behind schedule that even it acknowledges that the project can't possibly be in service until late in 2016.

What is holding up the project?  It is not just the virtually unanimous objections to the project in the New Hampshire communities that would be impacted by the construction of the transmission lines and towers—Franklin being an exception. It is not just the successful passage in the State Senate of legislation—House Bill 648-- against the use of eminent domain for transmission projects such as Northern Pass.

It is much more. It involves massive landowner opposition in Coos County where Northern Pass is attempting to cobble together a new route running from the Canadian Border to Groveton.  After being confronted with massive adverse testimony in the federal Department of Energy (“DOE”) scoping hearings held last March and April, Northern Pass announced that it was “listening” to the people and that it would be working on finding a new route in Coos County. Last May, Martin Murray, Northern Pass’s public relations specialist, told the press that Northern Pass was having much success in “talking with landowners.” Northern Pass even told the press that it would announce a new route in June of 2011.

Of course, mid-June came and went without a new route being announced; and the DOE extended the scoping comment period indefinitely pending Northern Pass identifying a new route from Groveton north to the Canadian border. 

On August 3, 2011, Northern Pass made this announcement:  “…the project’s expected in-service date has been modified to 2016, with construction expected in the 2014 – 2016 time frame, compared to the initial range of 2013 – 2015.  Our goal has been to locate the line within existing rights of way, as much as possible, and to minimize potential impacts for residents and communities. We listened to residents’ input and concerns, and determined that an alternative route is appropriate in the area north of Groveton, and that it can be developed without any increase in the project cost or benefits. The only change is in the construction schedule. The project expects to announce the new preferred route for that area later this year.”

But that didn’t happen either. “Later this year” came and went and so did a hoped-for right of way invasion of the Balsams properties in Stewartstown and Dixville that Northern Pass was apparently counting on for its new, so called landowner-friendly route. Speaking of the Society for the Protection of New Hampshire Forests’ acquisition of a conservation easement over the Balsams property and extinguishment of Northern Pass’s hoped-for right of way, here is what Northern Pass told the public earlier in January:  “While Northern Pass had an interest in this specific utility right of way, we are continuing to successfully work with landowners as we consider other routing alternatives. We look forward to soon announcing a new proposed route that has the support of underlying land owners.” 

But “soon” isn’t happening either. This was acknowledged two weeks later when Northern Pass dropped the “soon” prediction and simply claimed that it was still working “successfully with property owners to purchase land or easements to develop an acceptable route in that area of the North Country where there is no existing transmission right of way.” 

Get the picture? One delay after another. Numerous landowners are still refusing to sell out the North Country. They believe that our landscapes, our values, our ability to be right with the world—indeed our very essence--require that our communities not be damaged by the infliction of above ground high voltage transmission lines. They want the land to be preserved for our children and grandchildren to enjoy in the same ways that we have been privileged to enjoy.  They want to be good neighbors to the rest of the state. 

So don’t believe any of the Northern Pass claims that they are “successfully” working with property owners to develop an acceptable route through the North Country.  Fact is that there is no such “acceptable route.”  Fact is that landowners are declining huge offers of cash virtually every day.  Fact is that there wasn’t an announced new route in June as promised.  Fact is there wasn’t an announced new route “later” in 2011 as promised.  Fact is there won’t be a new route announced “soon”. 

My hat is off to the brave landowners of the North Country who have turned down enormous offers of money in order to preserve their properties and our scenic values for the benefit of family, friends and neighbors—indeed the benefit of all of us in the State of New Hampshire.

Thank you from the bottom of my heart.

Bob Baker

Monday, January 30, 2012

Northern Pass's Newsletter (Issue 2): Wolf in Sheep's Clothing

Northern Pass Newsletter Alert!
Newsletter #2 looks like more of the same "pious baloney" that Newsletter #1 brought us. But read it carefully . . . .

Northern Pass has just issued its second newsletter to “Northern Pass Landowners.” There they go again! We’ve explained before that there is no such person as a “Northern Pass Landowner.”  Northern Pass is still an idea on paper; it has no regulatory status whatsoever. Some of us do own land in NH that has an easement deeded to PSNH on it. This does not make us “Northern Pass Landowners.” Northern Pass is not PSNH. Northern Pass continues to use a dishonest term that attempts to get us to agree that our land rights (easements) are the chattel of Northern Pass. They seem to think that if they say it often enough, we’ll believe it.
Much the same can be said of the rest of the second newsletter. It’s full of half-truths, misleading statements, and spin. For instance, the newsletter says that “landowner outreach specialist” Jim Wagner visited folks, originally negative about Northern Pass, who were glad “to learn the other side of the story,” but it doesn’t tell you that Jim Wagner has also visited folks who detest Northern Pass and didn’t change their minds after his visit.  The newsletter has a feature piece on Brian Underwood, an appraiser hired by Northern Pass who not surprisingly concludes that HTVL lines won’t significantly lower your property’s value, but it does not tell you that Underwood declined to undertake a full scale "before-and-after" certified study like the one that shows a 60-90% drop in values of land in Dalton. He knew better.
Or look at the newsletter’s picture of an undammed river rushing under a high trestle bridge; the image is captioned “clean renewable power.” One of the several reasons that hydro power from Quebec is not classified as “clean,” “green,” or “renewable” in the U.S. and in NH is that huge and environmentally damaging impoundment dams are used to create it. Hydro Quebec’s electricity is not generated from freely running rivers like the one shown in the picture.

The column to read carefully, however, is “Working With You: Rights-of-Way Access.” You or your predecessor may have deeded an easement or right-of-way (ROW) to PSNH, but no one has deeded anything to Northern Pass. Northern Pass has zero authority over your contractual relationship with PSNH. But read the column anyway. It’s tricky. Watch the sleight-of-hand and ask yourself why Northern Pass is giving you “guidance” on an easement that it does not own and rights of access that it does not have. (Think! Why is Northern Pass being so "nice" to you?*)
Halfway down the column, Northern Pass starts talking about “impediments” or “barriers” that may have been constructed on a PSNH ROW -- things like livestock pens, hayfields, or gates and fences. Let’s add driveways, wells, gardens, septic systems, sheds, swimming pools, tennis courts, garages, even houses or parts of them. Remember, these are ancient ROWs. Northern Pass goes on to say that “the easement requires that a Joint Use Agreement [JUA] be executed to ensure that fences and barriers have gates or openings wide enough to accommodate access by emergency or maintenance equipment.” (As are easement deeds, JUAs are recorded at the county Registry of Deeds.)
Northern Pass has no authority to tell you what the legal relationship between the grantor and grantee of a PSNH easement is, but stay with this for a few more minutes anyway. Why would Northern Pass suddenly  raise the issue of a JUA on the illogical grounds that it will ensure that gates or openings are wide enough for maintenance equipment? If the gates or barriers have been there for years, as many have, they must already be wide enough or PSNH would have had them removed by now. Why does Northern Pass want you to think that you have to sign a JUA with PSNH? If you haven’t been asked to sign one before, why should you sign one now?Ask yourself, what's in it for Northern Pass? 
Be aware that under a set of very specific conditions, if your so-called impediment has been on a PSNH ROW for over 20 years continuously, you may have the right not to have it removed. You may have gained what’s called “adverse possession” of a portion of the ROW.  And if you sign a JUA, you may forfeit any right of possession that you have. Northern Pass would like that, of course. You need legal advice from your attorney, who will figure out and advocate for your rights, not "guidance" from a self-serving newsletter that's trying to get you to believe that you are a "Northern Pass landowner."
If Northern Pass wants you to sign anything, insist that Northern Pass pay your cost to consult an attorney of your choice before you decide and before you even discuss the matter.
Northern Pass has no legal right to require you to sign anything. You are under no obligation even to talk to Northern Pass. Your attorney can review your easement deed and advise you of your rights.
Please pass the word to all landowners with PSNH ROWs on their property.


Northern Pass's first landowner newsletter (November 2011) is here.

* "For God's sake, think! Why is he being so nice to you?

Tuesday, January 24, 2012

Rally to Preserve Property Rights!



Citizens of New Hampshire
Rally to preserve our property rights!
Date:  Wednesday January 25, 2012
Time:  9:30 am
Place: Capitol Building, Concord NH
Attire: red, white and blue
Focus: Article 12-a

"A person's property cannot be taken by eminent domain if the purpose is for private development or other private use of property."

Sunday, January 22, 2012

Defend 12-a Day ~ January 24th!

Tuesday, January 24th

Senator Jeb Bradley has now proposed three amendments to HB 648 that favor big utility companies over New Hampshire families. These amendments weaken property rights.
Senators Bragdon and Forrester have proposed an amendment that defends property rights and protects property owners by closing loopholes in RSA 371:1 and conforming it to Article 12-a.
Many senators are still deciding how they will vote on HB 648. Even if you have already contacted senators, please reaffirm your support for Bragdon/Forrester. A short email with “Vote for Bragdon/Forrester” in the subject field will accomplish this.
On Tuesday, January 24th, which is the day before the Senate votes on HB 648, please contact* legislators with the following simple message:
·        Protect NH property rights;
·        Defend Article 12-a, which denies eminent domain to private developers, by:

Voting FOR the Bragdon/Forrester amendment;

Voting AGAINST Bradley’s amendments.

Add your voice to the many voices in New Hampshire that will be defending Article 12-a of the Constitution on January 24th!

*Email and phone contact information
You may copy and paste some or all of the senators’ addresses into the “to” field of your email:
bob.odell@leg.state.nh.us,john.gallus@leg.state.nh.us,jeanie.forrester@leg.state.nh.us,jack.barnes@leg.state.nh.us,james.forsythe@leg.state.nh.us, peter.bragdon@leg.state.nh.us, matthew.houde@leg.state.nh.us, andy.sanborn@leg.state.nh.us, chuck.morse@leg.state.nh.us, sharon.carson@leg.state.nh.us, fenton.groen@leg.state.nh.us, raymond.white@leg.state.nh.us, dboutin1465@comcast.net, jeb.bradley@leg.state.nh.us, jim.luther@leg.state.nh.us, molly.kelly@leg.state.nh.us, sylvia.larsen@leg.state.nh.us, james.rausch@leg.state.nh.us, amanda.merrill@leg.state.nh.us, represcott@represcott.com, dalas@leg.state.nh.us, nancy.stiles@leg.state.nh.us, tom.deblois@leg.state.nh.us, gary.lambert@leg.state.nh.us
Phone numbers are here: forestsociety.org/senators
For more information on the various 648 amendments, see:

12-A  Day  ~ January 24th!

Bradley Amendments Undercut NH Property Rights!

The following analysis was prepared by members of Responsible Energy Action LLC (REAL). Additional analyses of HB 648 are available at http://www.responsibleenergyaction.com/

Senator Jeb Bradley’s Blatant Attempt to Undercut New Hampshire Property Rights
State Senator Jeb Bradley has prepared some new proposed amendments to HB 648, the important bill that would stop unconstitutional eminent domain abuses by private transmission lines.  Bradley has proposed no fewer than three amendments now to confuse the issue, derail HB 648, and stymie the Bragdon-Forrester amendment that would improve the legislation.
Amazing as it may seem, Bradley’s amendments actually encourage unconstitutional "takings" of private property from New Hampshire families. The Legislature simply cannot write statutes that violate (in this case create an off ramp from) Article 12-a of the Constitution.

Bradley’s changes disregard our state constitution and the will of the people by enabling unconstitutional "takings." In sharp contrast, HB 648 Bragdon-Forrester respects our state constitution and brings the eminent domain statutes into line with the strict limits against eminent domain by private development projects in Article 12-a of the constitution.

Bradley’s amendments stoop to new lows of legislative trickery.  If Bradley’s amendments are adopted, the result will be to advance the business interests of the big utility companies at the expense of New Hampshire property rights.


Your senator's contact info is here.

We apologize for the length of the analysis that follows, but it is crucial to understand how the Bradley amendments disregard Article 12-a of the Constitution and undercut property rights.
In 2006 New Hampshire voters overwhelmingly adopted strict new constitutional limits on “takings” of private property.  By an 85% vote, the people of New Hampshire codified in Article 12-a of the state constitution that eminent domain may not be used “if the taking is for the purpose of private development.”
These strict New Hampshire limits were imposed in response to the infamous Kelo v. New London case.  In Kelo, the US Supreme Court approved the use of eminent domain to take Suzette Kelo’s family home for a private real estate redevelopment project.  The court said the city’s claim of higher tax revenues and other economic and social benefits was enough to justify the taking.  Article 12-a was New Hampshire’s response; and it was intended to make it 100% clear that private projects do not get eminent domain, regardless of how many economic and social benefits they may generate.
Fast forward to last year.  Hydro-Quebec, Northeast  Utilities, NStar and Public Service of New Hampshire (PSNH) announced Northern Pass, a private, for-profit transmission line project that would bisect New Hampshire. This transmission line was not asked for or found to be needed by any federal, regional or state regulator.  Instead, the project sponsors dreamed up Northern Pass solely for their own corporate profit.  They carefully designed the project so that they would pay all project costs (Northern Pass is a “participant-funded” project) and thereby keep the exclusive use of the transmission lines for their own benefit.
Even though Northern Pass is the poster child for a private project prohibited from eminent domain by the state constitution, the project sponsors have threatened to “take” land needed to build the transmission lines.  In regulatory filings and statements to the press, Northern Pass consistently maintains that it can seek eminent domain to seize the land it needs from New Hampshire families who don’t want to sell.
Northern Pass is just the tip of the iceberg.  An explosion of private transmission lines – with the accompanying threat of eminent domain abuses – looms over New Hampshire. See this map of lines that are already in the planning process.
HB 648 was introduced to protect New Hampshire property rights from these eminent domain abuses.  The bill provides that private transmission lines (just like generation plants in today’s de-regulated environment) may not use eminent domain.  Project sponsors can freely assemble land in voluntary transactions with willing landowners, but cannot condemn land by exploiting loopholes in the old eminent domain statutes that have not been updated to reflect the strict limits of Article 12-a.
HB 648 was overwhelmingly approved by the New Hampshire house and is now pending in the New Hampshire senate. 
Bradley’s Legislative Trickery
HB 648 is simple, clear, necessary and effective.  With the wording improvements in the proposed Bragdon-Forrester amendment, the bill provides that private transmission lines (that is, participant-funded electric transmission projects) may not seek to use eminent domain in our state.  Bragdon-Forrester respects our state constitution and brings the eminent domain statutes into line with the strict limits in Article 12-a of the constitution against eminent domain by private development projects.

In his effort to obfuscate the clarity provided by the Bragdon-Forrester amendment, Senator Bradley has now proposed no fewer than three amendments that seek to turn HB 648 inside out.  Bradley is contorting HB 648 into legislation that will no longer prevent eminent domain abuses, but will instead provide a roadmap for private transmission lines to “take” land from New Hampshire families.

Bradley’s amendments are bad policy, unfair to property owners and a bald giveaway to the big utility companies. And by enabling "takings" by private transmission lines, Bradley’s amendments are unconstitutional expansions of eminent domain authority beyond Article 12-a’s strict limits.
Trick #1:  Bradley ENABLES Eminent Domain Abuse by Private Transmission Lines
The Bragdon-Forrester amendment changes the last sentence of the applicable eminent domain statute (RSA 371:1) to prohibit eminent domain for private transmission lines.  Although not yet final, the wording is something like this, with the new language in bold italics:  No public utility may petition for permission to take private land or property rights for the construction or operation of an electric generating plant or a participant-funded electric transmission project.”  This is a clear prohibition on eminent domain for these projects.
In contrast, Bradley proposes language that would enable eminent domain for private transmission projects.  Bradley’s most recent language (a revision to the Bradley-Carson amendment) would add a sentence to RSA 371:1 that authorizes private transmission line “takings.”  Eminent domain by private transmission lines would be allowed if the state Public Utilities Commission (PUC) finds that the transmission project “is necessary for system reliability in this state, or provides a means of lowering electricity costs in this state, or provides environmental benefits in this state.”
Why do we call this legislative trickery?  Because at first glance, the words look like they have some meat to them.  Bradley says “takings” for private transmission lines will be allowed only if the PUC makes some specific findings.  He even uses the words “system reliability” from the original version of HB 648 passed by the house.
But it’s all smoke and mirrors.  The three tests Bradley sets up for the PUC are “or” tests (disjunctive).  Only one test has to be met and the limits disappear.  If any test is met, then the private transmission line can use eminent domain. 
To keep it simple, all you need to look at is the second test (“provides a means of lowering electricity costs in this state”).  By definition, this will be met by any transmission line bringing new electricity supply to the New England grid.  It’s nothing more than the immutable law of supply and demand.  If you add supply to the grid, of course there is a “means” for prices to come down.  Add supply and, all else held equal, prices fall, even it’s just by a fraction of a fraction of a penny.
We repeat that to be sure the point is clear: every single private transmission line will automatically meet Bradley’s amendment language and qualify for eminent domain, because new electricity supply to the grid can by definition reduce prices.  Bradley’s amendment is not a hurdle or a test.  Bradley’s amendment is a fraud -- carte blanche for private transmission lines to use eminent domain.
What about the other two tests, reliability and environmental benefits?  Remember, you don’t need to consider either of these to discredit Bradley’s amendment because his three tests are “or’s” and only one must be met to qualify for eminent domain.  But even if Bradley were to change the “or’s” to “and’s,”that is, even if all three tests must be met, it’s still smoke and mirrors.  The Federal Energy Regulatory Commission (FERC) has already commented that Northern Pass may add to “reliability” because there is a new, redundant source of electricity.  And the PUC could adopt Hydro-Quebec’s claims that hydropower is less environmentally damaging than coal fired power plants.  These are easily manipulated subjective hurdles that  will mean little in the hands of a highly activist and highly political (and arguably captive) administrative agency such as the PUC.
So even if Bradley bobs and weaves on the senate floor and changes “or’s” to “and’s,” the message is clear.  Bradley’s language enables eminent domain abuse by private transmission lines.  Bradley’s language is a fraud on the people and an insult to the senators who are working in good faith to address the property rights issues.
Trick #2:  Bradley PRETENDS to address the constitutional (12-a) eminent domain prohibition
Article 12-a prohibits eminent domain by private development projects.  In a trick worthy of a circus magician  expert at drawing attention away from what is really happening, Bradley has proposed another amendment (Bradley-Deblois) that parrots Article 12-a.  Bradley would create the appearance that his amendment updates the eminent domain statutes to incorporate the strict Article 12-a limits, but it’s a diversion.  In fact, Bradley would enable eminent domain by private transmission lines.
Bradley’s language, which would form a new, stand-alone paragraph in RSA 371:1, quotes Article 12-a in its entirety.  Bradley’s amendment then states:   Therefore, no private development entity may petition the public utilities commission for the use of eminent domain.”
At first glance, this looks good.  The language reads as a flat prohibition on any private development entity petitioning for eminent domain.  But don’t be fooled so easily.
The trick (like the circus magician) is that this language is placed off by itself.  It’s just a diversion to make it seem that Bradley is protecting property owners (not true) and to draw attention away from the fact that Bradley has made no change whatsoever to the main part of RSA 371:1, which authorizes private transmission lines to apply for eminent domain!
Let’s go over this slowly to be sure it’s clear.

      1. Private transmission line developers are statutory “public utilities.”
Under New Hampshire’s ancient statutes, pretty much any company having anything to do with electricity falls into the overbroad definition of “public utility.” These statutes define “public utility” as “every…company…and person…owning, operating or managing…any…equipment…for the generation, transmission or sale of electricity ultimately sold to the public” (RSA 362:2, emphases added). If you merely “own” any transmission equipment, as will Northern Pass and every other private transmission line developer, you’re automatically a “public utility.”

2.       Got any doubt?  Northern Pass is already a federal public utility and plans to apply for state public utility status.   FERC’s official list of federal public utilities already includes Northern Pass as a regulated utility.  The New Hampshire PUC has disclosed that Northern Pass will seek NH public utility status.  (See http://www.puc.nh.gov/Electric/Northern%20Pass/handout%20Proposed%20Northern%20Pass%20Project.pdf.)

3.       Private transmission lines (including Northern Pass) can therefore apply for eminent domain under the current language of RSA 371:1.  Bradley’s language makes no changes whatsoever to the existing eminent domain authority available to “public utilities” under RSA 371:1.  This provision has the loopholes that Northern Pass and other private transmission lines can try to exploit.  And because these entities will be “public utilities,” this is how they’ll proceed.

4.       Bradley’s new, nice-sounding constitutional language is therefore irrelevant to eminent domain by Northern Pass and other private transmission lines because they will qualify under the extremely broad definition of “public utility.”  The new language quoting Article 12-a is a stand-alone provision that says “private development entities” can’t petition for eminent domain.  It doesn’t make any change to the current version of RSA 371:1, which authorizes any “public utility” to petition for eminent domain.   Private transmission line developers are technically “public utilities,” so they’ll proceed under the current version of RSA 371:1.
When we used the term “legislative trickery” to describe Bradley’s amendments, we did so carefully.  You can’t make up a more cynical set of tricks than what you see in the Bradley-Deblois amendment.  
Trick #3:  Bradley proposes new eminent domain procedures that hurt landowners and help private transmission line developers
The Bradley-Carson amendment has a few pages of nice-sounding procedural stuff that, at first glance, would appear intended to help property owners.  But it’s not true.  The provisions are actually a roadmap for private transmission line developers to become more efficient and effective at abusing landowners in the eminent domain process.  We’ve previously written about this at length.
A few quick highlights…
The Bradley-Carson amendment provides a $25,000 fine for unlawful threats of eminent domain.  That’s meaningless chump-change when private transmission line developers like Northern Pass are out bidding and paying millions of dollars to buy up land under the wrongful threat of eminent domain.  For $25,000 (just 2.5% of a $1MM land purchase, a fraction of the real estate commission), Bradley-Carson gives Northern Pass and others a free pass to threaten and intimidate landowners.  Heck, for a really important piece of land they may want to spend $50,000 on fines so they can make two rounds of threats.  Some protection…
The Bradley-Carson amendment says that Northern Pass or another private transmission line developer can’t petition for eminent domain unless they’ve offered the landowner a price of two times appraised value.  Unfortunately for landowners, 2x appraised value is actually a sharp discount to the market price Northern Pass has recently paid for transmission corridor land.  Northern Pass has offered or paid multiples of this – well more than 5-10x.  Bradley-Carson would take money out of landowners’ pockets by stripping away the market premium for transmission corridor land and capping prices at 2x appraised value.  By lowering the price by statute, this takes money from landowners and puts it into the pockets of the private transmission line developers.  What else would you expect from Jeb Bradley?

*  *  *  *  *  *  *  *  *  *  *  *
Bradley’s amendments are a fraud on New Hampshire voters and an insult to his senate colleagues.  In a just world, they will be summarily rejected, and Bradley will be held politically accountable.


Selected Contributors to Jeb Bradley’s 2010 Campaign

New Hampshire voters and Bradley’s senate colleagues should ask themselves why Bradley would propose such harmful amendments.  Readers can decide for themselves if part of the answer lies in the following list of contributors.

·         Public Service of New Hampshire

·         James A. Muntz, President of Transmission, Northeast Utilities

·         Gary A. Long, President, PSNH

·         William H. Smagula, Director of Generation, PSNH

·         Mary-Jo Boisvert, Director of Communications,PSNH

·         John M. MacDonald, Vice President, Generation, PSNH

·         Paul E. Ramsay, Vice President, Energy Delivery, PSNH

·         Gallagher Callahan and Gartrell, lobbyists and lawyers for Northern Pass

                Elevare Communications, communications consultants for Northern Pass

Thursday, January 19, 2012

Pinocchio Fact Checker: Arguments against HB 648 Bragdon/Forrester

Pinocchio Fact Checker: Arguments against HB 648 Bragdon/Forrester Amendment

In the spirit of the "Pinocchio Fact Checker," Bury the Northern Pass looks at the rhetoric and reality of arguments against  HB 648 Bragdon/Forrester amendment (648 B/F)

1. Providing electricity is a public purpose, and eminent domain should not be restricted.  

     That may have been the case in the old days when utilities were government owned, highly regulated, and essentially an arm of the government.  But it is entirely different in today’s world of de-regulation and investor-owned utilities. To disprove this objection you need go no further than current 371:1, which bans eminent domain for generation plants because, in the de-regulated environment, generation plants are private businesses.  Electricity is no longer recognized as a special public good.  648 B/F simply carries the logic of 371:1 to close the loophole that would allow private transmission lines to use eminent domain.

2.  648 B/F is not needed because Article 12-a already provides full protections to landowners. 

Not true.  Article 12-a will not provide ANY protections until, at best, the very end of the process.  A landowner threatened now by an abuse of eminent domain has no claim under Article 12-a.  A court will throw out any claim and say “let the Public Utilities Commission (PUC) process run its course before we hear any case.”  So, a landowner has to wait until the private transmission line developer petitions for eminent domain to the PUC under 371:1, and then wait for the PUC decision. This is unfair for landowners.

And remember, the PUC is a VERY activist agency that frequently substitutes its own judgment in areas where the legislature has spoken clearly.  The PUC does not have to take landowner interests into account – it balances ratepayer and utility interests.  There is a real risk the PUC, enamored of renewables and essentially working for utilities and ratepayers, will stretch to find a way to allow takings of land.  If the PUC grants a taking and the landowner appeals under 12-a to the NH courts, the courts will give the PUC a huge amount of deference and will set aside a PUC decision only if it is an “abuse of discretion” or is unsupported by any facts.  For these reasons – delay, litigation cost, PUC incentives and deference of the courts to the PUC – the supposed protections of 12-a are illusory.  Landowners need 648 B/F for any meaningful protection at the front end of the process.

3. 648 B/F unfairly targets a single project, Northern Pass.    

Not true. The Bragdon-Forrester language (and the original HB 648 language) is general in scope.  The bill targets property rights and eminent domain abuses.  Opponents of 648 B/F can’t even argue that the bill would principally affect Northern Pass.  There are now two private transmission lines proposed for New Hampshire – Northern Pass and Northeast Energy Link.  And many more private transmission lines are at various stages of consideration at federal, regional and state planning bodies. The potential for abuse of eminent domain by private transmission lines is a large, growing problem and a very appropriate subject for legislation.

4. But Northern Pass was already proposed, so 648 B/F is unfairly trying to stop an EXISTING project.

Northern Pass has absolutely no regulatory status in New Hampshire at the current time.  The project has made no application or filing with the PUC. The project doesn’t even have a route!  This argument is like saying that if a company comes to New Hampshire and announces it plans to build a nuclear waste facility, but it doesn’t have any town identified yet or any specific plans and has not yet made any regulatory applications, there can no longer be any legislative actions about nuclear waste.  There is nothing unfair about 648 B/F given the inchoate state of Northern Pass.  And on narrow legal grounds, Northern Pass is in no way “vested” for purposes of having rights protected from future legislation. 

Northern Pass may also claim that it is "unconstitutional" under the federal or state constitution to take away its vested contractual rights (i.e., transmission services agreement between NU, NSTAR and HQ’s US subsidiary) based on its ability to have the use of NH's eminent domain statutes because it entered into contracts that affect interstate commerce and it has started the federal regulatory process for approval of its transmission line. 

This is also nonsense.  Article 12-a of the NH Bill of Rights was enacted more than four years prior to the announcement of Northern Pass in explicit recognition of the Supreme Court's invitation to the States to alter the outcome of the Kelo holding.  648 B/F does nothing more than make the statutes conform to the proscriptions of Article 12-a.  There is no ex-post-facto problem at all in conforming ancient legislation to recognize that which the Constitution already prohibits.

 5. 648 B/F will chill future energy investment in New Hampshire.     

The “chill” argument is based on the false premise that 648 B/F is unfair to Northern Pass (see #3 and #4).  Indeed, the contrary position is more likely accurate.  Businesses like certainty and clarity in the rules.  It should be 100% clear when eminent domain is, and is not, available.  This will let businesses decide how to proceed and invest.  648 B/F makes the needed clarifications and updates the old statutes.  It takes away the loophole under 371:1 that lets private transmission lines apply for eminent domain even though 12-a says no.  This levels the playing field between companies prepared to push the outer envelope of legal interpretation (Northern Pass) and those that are more conservative and responsible.

6. 648 B/F will stop "good" energy investments – new renewables plants, connector lines, the upgrade of the Coos Loop, etc. 

All 648 B/F will stop is eminent domain abuse by private projects in the energy sector.  It affects nothing else.  New renewables generation plants already were restricted from using eminent domain, under 371:1.  648 B/F changes nothing on eminent domain by generation plants – they can’t use it. 

648 B/F also changes nothing regarding “connector lines” that hook up generation plants to the grid.  It has long been accepted across the industry that connector lines do not get eminent domain in New Hampshire.  See the New England Power Generators comment letter on 648 B/F from last year – no generation plant would even try to use eminent domain for its connector line! 

Similarly, the Coos Loop upgrade, long studied by the state, is in essence a “connector line” that would add capacity to connect new wind farms and biomass plants to the grid.  This is why ISO-NE and the state have made it 100% clear that any Coos Loop upgrades must be paid for by the generators themselves.  If the Coos Loop upgrade ever occurs, it would not be entitled to eminent domain in any case under the better view that it is a connector line.  And in any case, NH’s own studies say the Loop upgrade can be accomplished within the existing ROW.

7. 648 B/F will stop “public-private partnerships” where the state, ratepayers and private businesses come together to build new energy facilities.

A project with private funding and for private gain should not be entitled to eminent domain, even if the private component is small.  That’s a matter of principle.  There are lots of different ways to get projects done, and all 648 B/F does is to make clear that private elements preclude eminent domain.

8. Northern Pass is good for New Hampshire and if 648 B/F passes, then Northern Pass dies and NH loses the benefits

See the Bury the Northern Pass's three-part blog for a rebuttal of all the claimed NH benefits of Northern Pass.  But even assuming for the moment that the project would be good for New Hampshire, 648 B/F in no way forecloses the transmission lines.  Northern Pass is absolutely free to go back to FERC and ISO-NE with a new project structure that would seek to have the costs of the lines allocated region-wide to ultimate electricity customers.  There is a clear path to do this – a “reliability” project, an “economic” project or a “policy” project, all under ISO-NE rules.  (Note:  ISO-NE is still in the process of developing its “policy” rules under FERC Order 1000).  If Northern Pass, when cast as a participant-funded project, cannot use eminent domain, then it can seek another project form that would take the project out of the coverage of 648 B/F and allow Northern Pass to apply to the PUC for eminent domain.

Monday, January 16, 2012

Why New Hampshire Needs to Pass HB 648 (Bragdon/Forrester amendment): Q's & A's (Part 3)

Why New Hampshire Needs to Pass HB 648 (Bragdon/Forrester amendment)

Q's & A's

Part 3

Q9: I've heard a rumor that there may be an announcement of a power purchase agreement (PPA) between PSNH and Hydro-Quebec (HQ) and that Northern Pass will say this means that Northern Pass is good for New Hampshire and should have eminent domain. What is the story with a possible PPA? Does it change the eminent domain analysis? If a PPA is announced, does this mean HB 648 should not pass?

A: I doubt there will be an announcement, but let's discuss the general idea of a PPA anyway in the context of eminent domain. Whether it’s between PSNH and HQ or any other parties, a PPA would be entirely irrelevant to eminent domain and HB 648. As we discussed in Part 1 and Part 2, the whole point of Article 12-a of the state constitution (New Hampshire’s “anti-Kelo” amendment) is to reverse the Kelo logic. Kelo said that if a private development project creates economic or social benefits, that’s enough to justify eminent domain. New Hampshire voters soundly rejected that idea by adopting Article 12-a. Article 12-a says a private development project is not entitled to eminent domain, period. The project can have all sorts of pretty-looking claimed economic and social benefits – jobs, taxes, lower electricity costs, environmental benefits, you name it – and the project is still not entitled to eminent domain. And that’s as a matter of NH constitutional law.

A PPA would be nothing more than another claimed economic benefit related to the Northern Pass project. It would not change the analysis under Article 12-a that NP is a private development project and is not entitled to eminent domain. And it would in no way reduce the need for HB 648 to close the loopholes in the 100-year-old eminent domain statutes to make them consistent with Article 12-a and to remove any loopholes that suggest private development projects can “take” property.

That’s all that needs to be said about this or any PPA, 12-a, and 648. Period.

Q10. OK. Why do you think there will be no PPA, if you don't mind my asking?

A. It's complicated. There are two things to understand. First, PSNH would have to say that the PPA is possible only because of Northern Pass, that they are taking electricity from the Northern Pass transmission line and using it in New Hampshire. They’d say this proves the Northern Pass line benefits New Hampshire.

Sounds good at first glance, but a PPA between PSNH and HQ has nothing to do with Northern Pass. PSNH and HQ could enter into the PPA right now!

Why? Because electricity already moves freely around the grid from suppliers to users, both under PPAs and spot wholesale transactions. HQ is already a major seller of electricity into New England. Right now – today – Vermont’s utilities buy gobs of electricity every day from HQ. Right now – today – HQ sells gobs of electricity into the New England grid, and when PSNH buys wholesale it is already buying HQ’s electricity. It’s the same across the board. The Seabrook nuclear plant sells a slug of its power to Vermont under PPAs. The Dixville wind farm sells most of its power to Massachusetts and Vermont under PPAs. The Berlin biomass plant will sell all its power to PSNH under a 20-year PPA recently approved by the New Hampshire Public Utilities Commission (PUC).

Got any doubts? Just look at Northeast Utilities’ webpage quoting transmission services for long-term electricity purchases from HQ in Quebec all the way down to customers in New England. (See http://www.transmission-nu.com/business/ratesum.asp.) To be clear, we don’t know the specific capacities available to each customer, but we do know that PSNH could purchase HQ power right now on a long-term firm basis with transmission over HQ’s and Northeast Utilities’ network.

Sure, the Northern Pass line would add more capacity for imports of HQ’s electricity into New England. But there is already room for a PSNH/HQ PPA. If PSNH and HQ wanted to, they could have signed a PPA years ago. To announce a PPA on the eve of the senate debate and try to link it to Northern Pass would be the height of hypocrisy.

Second, PSNH would have to say that a PPA with HQ shows that Northern Pass is good for New Hampshire because it will contribute to lower electricity prices and bring in “clean” power. As we have just shown, NP is irrelevant to a PPA. But let’s humor PSNH and look at the pricing and renewables issue.

This would be a tough one for PSNH. It would be interesting to see how PSNH would try to steer between a rock and a hard place, the Scylla of having PPA pricing so high there are no price benefits for New Hampshire and the Charybdis of having PPA pricing so low it undercuts the state’s own renewables producers.

Let’s look at the numbers. Fairly stated (that is, including an appropriate cost allowance for the Bow scrubber and the costs of the above-market small biomass PPAs), PSNH’s electricity rate is somewhere between 8.5 cents and 9 cents per kWh. This is a high rate (one of the highest in the nation) because PSNH continues to run its old, inefficient plants (Bow, Schiller, etc.), and also because PSNH has locked itself into a series of long-term, above-market PPAs. Wholesale prices run roughly 5 cents per kWh, which means PSNH’s customers are paying WAY above market for our power. We’re subsidizing PSNH’s failed business model.

Three other background numbers are important. What does HQ currently charge the Vermont utilities for their PPAs? The current price is in the range of 5.7 cents per kWh. What do alternative “base load” suppliers charge for PPAs? Vermont Yankee recently offered its power at 4.9 cents per kWh. And what does PSNH pay under its most recent New Hampshire “renewables” PPA? PSNH will be paying the Berlin biomass plant 6.9 cents per kWh. (Transmission charges are not included in these prices.)

So how would PSNH and HQ price their PPA, with these price points in the background? If the PPA is priced above 5.7 cents per kWh (HQ’s price to Vermont), PSNH would look pretty stupid for leaving money on the table and disadvantaging New Hampshire ratepayers. Indeed, if the PPA is priced above current wholesale (5 cents per kWh), PSNH will continue to lose out competitively to new wholesale-based entrants like Resident Power who buy wholesale and resell retail over PSNH’s distribution lines. PSNH’s death spiral will continue.

But to have any cost benefits for ratepayers, and to slow down the death spiral, PSNH has to price the PPA below its current “fair” energy service rate (below 8.5 cents to 9 cents per kWh). Otherwise PSNH is not reducing its energy costs at all. But if the PPA is priced below 6.9 cents per kWh (PSNH’s PPA price with the new Berlin biomass plant), PSNH will be admitting to the world that it mispriced the Berlin deal just a few months ago! And, more importantly, PSNH will be undercutting the future development of New Hampshire’s own renewables sector if it prices below the Berlin price. As I said, PSNH is stuck between a rock and a hard place. It can’t price the PPA above 5.7 cents per kWh, on the one hand, and, on the other hand, it can’t price it below 6.9 cents kWh.

Indeed, the big policy considerations militate against a PPA with HQ. If PSNH really wanted to save money for ratepayers, they’d buy from the nuclear plants at prices cheaper than HQ’s going rate. If PSNH wants to tout renewables, they’d enter more PPAs with NH renewables generators at prices higher than HQ’s going rate.

With all due respect to PSNH, we doubt they’d be able to figure their way out of this muddle. We believe that, on careful review, PSNH would be unable to make any credible case that a PPA with HQ is “good” for New Hampshire ratepayers and for New Hampshire’s renewables sector. The claims of policy benefits would almost certainly ring hollow.

Got it?

Q. Yes. It’s the frying pan or the fire for the PPA.

A. In any event, the main point is still this: no matter what PSNH and HQ do or say about a PPA, any PPA is simply irrelevant to the senate discussion on 648. It won’t change the fact that as a private project, Northern Pass is not entitled to eminent domain under Article 12-a. And it won’t lessen the need for HB 648 to remove the loopholes from the old eminent domain statutes and make them consistent with Article 12-a.

Any other questions?

Q. Nope. The answer is always the same: pass 648 Bragdon/Forrester now to complete the work of 12-a.