Tuesday, December 4, 2012
NHCSE gets it wrong on Northern Pass
Following Minnesota's Lead
Last week, the NHCSE posted a blog, "Minesota Power to Import Canadian Hydro," that opens with a fundamentally inaccurate central claim: "Following New Hampshire's lead, Minnesota Power taps into the benefits of clean, renewable, Canadian hydroelectricity..." We'll leave aside the persistent false assertion that big hydro is "clean" - the U.S. EPA excludes it - and focus on the more deeply misleading implications of Minnesota Power's "following" New Hampshire's lead.
In the first place, Northern Pass is not New Hampshire. If Minnesota Power is following any lead in proposing its Great Northern Transmission Line (GNTL), it would be that of a group of corporations, Northeast Utilities, Northern Pass, and Hydro Quebec, which in no way comprises "New Hampshire," however one wishes to construe the term.
More importantly, Minnesota Power is not even following the lead of Northern Pass et al. There is a fundamental difference between the proposed GNTL and proposed NP projects. The key point is that a new transmission line cannot be built in Minnesota unless the PUC, under highly specific statutory tests, finds the transmission line is “needed” for reliable electric service:
“The [Minnesota PUC] may only certify a project that is a high-voltage transmission line as defined in section 216B.2421, subdivision 2, that the commission finds is:
(1) necessary to maintain or enhance the reliability of electric service to Minnesota consumers;
(2) needed, applying the criteria in section 216B.243, subdivision 3; and
(3) in the public interest, taking into account electric energy system needs and economic, environmental, and social interests affected by the project.”
The "need" criteria referred to in section 2, above, are stringent:
Subd. 3.Showing required for construction.No proposed large energy facility shall be certified for construction unless the applicant can show that demand for electricity cannot be met more cost effectively through energy conservation and load-management measures and unless the applicant has otherwise justified its need. In assessing need, the commission shall evaluate:
(1) the accuracy of the long-range energy demand forecasts on which the necessity for the facility is based;
(2) the effect of existing or possible energy conservation programs under sections 216C.05 to 216C.30 and this section or other federal or state legislation on long-term energy demand;
(3) the relationship of the proposed facility to overall state energy needs, as described in the most recent state energy policy and conservation report prepared under section 216C.18, or, in the case of a high-voltage transmission line, the relationship of the proposed line to regional energy needs, as presented in the transmission plan submitted under section 216B.2425;
(4) promotional activities that may have given rise to the demand for this facility;
(5) benefits of this facility, including its uses to protect or enhance environmental quality, and to increase reliability of energy supply in Minnesota and the region;
(6) possible alternatives for satisfying the energy demand or transmission needs including but not limited to potential for increased efficiency and upgrading of existing energy generation and transmission facilities, load-management programs, and distributed generation;
(7) the policies, rules, and regulations of other state and federal agencies and local governments;
(8) any feasible combination of energy conservation improvements, required under section 216B.241, that can (i) replace part or all of the energy to be provided by the proposed facility, and (ii) compete with it economically;
(9) with respect to a high-voltage transmission line, the benefits of enhanced regional reliability, access, or deliverability to the extent these factors improve the robustness of the transmission system or lower costs for electric consumers in Minnesota;
(10) whether the applicant or applicants are in compliance with applicable provisions of sections 216B.1691 and 216B.2425, subdivision 7, and have filed or will file by a date certain an application for certificate of need under this section or for certification as a priority electric transmission project under section 216B.2425 for any transmission facilities or upgrades identified under section 216B.2425, subdivision 7;
(11) whether the applicant has made the demonstrations required under subdivision 3a; and
(12) if the applicant is proposing a nonrenewable generating plant, the applicant's assessment of the risk of environmental costs and regulation on that proposed facility over the expected useful life of the plant, including a proposed means of allocating costs associated with that risk.
If built, GNTL will have to be a “needed” line. It will undergo serious scrutiny by the Minnesota PUC to determine that it is a reliability project. This proposed line is completely different from Northern Pass, which is not "needed." It is an elective project, a merchant venture proposed simply to make money for its owners. It has neither been examined nor requested by ISO-NE for reliability.
In fact, the proposed Northern Pass project is a highly eccentric concept - a transmission line that no one asked for and no one needs to keep the lights on. The NHCSE's false analogy attempts to "normalize" Northern Pass, but Northern Pass remains what it is: a new brand of merchant venture on the part of its corporate sponsors that has nothing to do with traditional projects like the proposed Minnesota line.
In assessing the "need" for a new transmission project, the Minnesota PUC wisely evaluates the "promotional activities that may have given rise to the demand for this facility" (216B.243, subdivision 3 ). Such analysis is rooted in an ancient Latin question - cui bono?- loosely translated, to whose good? Who stands to benefit most from the project? Who stands to lose the most? Have project sponsors created demand through marketing techniques and so-called outreach campaigns? New Hampshire would do well to follow Minnesota's lead and ask the same questions as part of the regulatory review of Northern Pass. Minnesota has many other important criteria by which we should measure this elective project. See above.
Posted by NH Jean at 8:55 PM