Friday, January 13, 2012

Why New Hampshire Needs HB 648 (Bragdon/Forrester amendment) Now: Some Q’s & A’s (Part 1)

Why New Hampshire Needs HB 648 (Bragdon/Forrester amendment) Now!

Some Q’s & A’s

Part 1

Part 2 | Part 3

HB 648 B/F does not target Northern Pass or any other specific project. It doesn't even mention Northern Pass or hydro power. It is general property rights legislation. But those who oppose 648 B/F typically want to talk about it in terms of how it is aimed at Northern Pass alone, so let’s start there with a few questions and answers. As you’ll see, however, 648 B/F is broad legislation that would protect all land and home owners, tenants, business owners, and others by preventing any private utility project, whether it be hydro, wind, biomass, solar, from abusing eminent domain. 

Q1.     What is Northern Pass?

A. Northern Pass is a private, for-profit transmission line. It was not asked for by any federal, regional or state regulator.  It is not necessary to provide electricity to New Hampshire or New England or to “keep the lights on.”  In fact, Northern Pass has been structured to avoid any determination by regional regulators (ISO-New England) as to whether the lines are somehow needed (because they are not!).  Northern Pass avoids the detailed regulatory review that would be needed for a traditional transmission line whose costs are allocated to customers across New England.  Northern Pass is a purely optional project, essentially exempt from regulatory review.  It’s the very definition of a private, for profit project -- thought up by Hydro-Quebec, Northeast Utilities and PSNH solely to make more money.  And in contrast to every other transmission line we’ve ever heard of, except possibly those in dictatorships, banana republics and the former Soviet Union, Northern Pass is NOT available to anyone who wants to use it.  It’s there just for Hydro-Quebec – for HQ’s exclusive use. We believe it is 100% clear that Northern Pass is a private development project within the meaning of New Hampshire’s constitution and as such is absolutely NOT entitled to eminent domain.

Q2.  If Northern Pass is private, why does it say in its federal filings and media statements that it can use eminent domain? I thought eminent domain could be used only by public utilities.

A. The current eminent domain statutes for energy projects are more than 100 years old; they were enacted in 1911.  They were drafted at a time when public utilities were arms of the state government, not the private, investor-owned businesses you see today.  And they were drafted when the job of public utilities was to bring power to the people to keep the lights on.  These were the days of “electrification.”  Now we are in the days of private profit, and the statutes don’t fit anymore.

For example, under the current RSA 371:1 any “public utility” is allowed to ask the PUC for eminent domain to take a family’s land for an electric line.  These old, overly broad 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; emphasis added).  If you merely “own” any generation or transmission equipment, you’re automatically a “public utility”!

Let's say my niece puts up a windmill on a hill on her land.  She wants to sell power to a friend’s farm two doors away.  She plans this for her own profit.  Nobody else will get to use the line.  A neighbor’s land is in between, and the neighbor doesn’t want a line in his backyard.  No worries for my niece!  Under the current outdated NH statute (RSA 362:2), she is a “public utility” She has the right (RSA 371:1) to petition the PUC to take the neighbor’s land by eminent domain to build the line! That's how outdated our NH statutes are; they're still stuck in the early twentieth-century horse & buggy era of electrification not the new deregulated age of private utility developers like my niece.

With due respect to prior legislatures, this potential of almost limitless eminent domain authority for private transactions cannot be intended to apply in today’s world.  And it is certainly flatly inconsistent with the strict limits of Article 12-a on eminent domain for private development projects.
Bottom line: the current outdated eminent domain statutes for energy projects are flatly unconstitutional as against Article 12-a.  It is the duty of the legislature to fix this glaring problem.
Q3. OK, I get it that "public utility" can now be stretched to include a private company, but do we have to pass 648 (Bragdon/Forrester) this year? Couldn’t we just have a moratorium or something and think about it for a few years? Won’t 12-a protect landowners in the meanwhile?

A. No. The problem for landowners is that Article 12-a doesn’t provide any remedy immediately.  A private developer can go to a landowner and wrongfully threaten her with eminent domain, but there’s no readily available way for a landowner to protect her interests now.  If the landowner goes to court, the judge will almost certainly say “I can’t hear any case until after the eminent domain process runs its course.”  In other words, the landowner has to listen to the threats, decide whether to sell out, and if she decides to hold on and fight, wait for the 2-3 years, or longer, for the developer to formally make a petition to the Public Utilities Commission (“PUC”) to seek eminent domain and for the PUC to issue a final decision.  Only at the end of that lengthy process will the landowner be able to get her case heard in court and be able to argue in front of a judge that Article 12-a does not allow eminent domain in her case.

In a word, Article 12-a can help a landowner only at the end of a long, expensive process.  It provides no help for landowners who are under threat now.

Q4. That sounds awful, but surely the PUC wouldn’t let a private utility abuse eminent domain against a landowner?

A. We want to be even-handed here so let’s just say that nowhere in the PUC’s mission does it say anything about protecting landowners.  Landowners are simply not part of the equation. Laws that may seemingly protect landowners may be found by an activist PUC not to have any real protections; and laws that are ambiguous (like the current eminent domain statutes) may be found by the PUC to mean anything the PUC wants.

And  the courts show a very high level of deference to the PUC’s determinations.  This makes it hard for parties to overturn PUC decisions.  If the PUC makes a factual determination that is the heart of a legal question under a statute (for example, whether there is a “need” for a power line), the courts will overturn the PUC only if the PUC’s decision can be shown to be an abuse of discretion.

In short, it should not be left up to three unelected commissioners who are politically appointed, whoever they are and however honorable they may be, to decide when the extraordinary state police-power of eminent domain seizure can be used against landowners.  The ground rules must be decided by the most representative state body, the legislature.

Q5. You said earlier that 648 Bragdon/Forrester isn’t just about Northern Pass. What do you mean?

A. It is about what could be called a systemic threat to New Hampshire property rights.  The systemic threat is the approaching tidal wave of private transmission lines that threaten to abuse eminent domain so they can slice through all parts of New Hampshire.

To set the stage, the whole country is in the midst of a renewable energy “gold rush.”  The current administration wants to do whatever it can to encourage new renewable energy sources.  This is not because they are necessary to keep the lights on, but because the current administration favors the idea of renewables. Some people agree; others don’t. That’s not the issue here. How this energy gets from generation to delivery point is the issue.

Renewable energy generation – wind, solar, hydro, biomass, etc. – is almost always located in open, rural areas like Northern New England.  But the only place the power can be used is in urban and suburban population centers such as Southern New England.  To get the power from the generation points to the demand points requires transmission lines.  New Hampshire is sitting right in the way – between the generation points in the north and the demand points in the south.

Click here to see some of the lines that private transmission developers would like to build through New Hampshire.

These lines are part of the planning process at federal, regional or state agencies.  They are part of the renewables “gold rush” that we discussed in three earlier posts – ways to bring renewables power through New Hampshire to demand points in the south.  Many of these lines are likely to be proposed as private, for-profit transmission lines – just like Northern Pass. And just like Northern Pass, they would use the unconstitutional threat of eminent domain to try to win the race to build first.

The outcome would be horrible for our state.  It’s just as if every provider of electronic services to families had its own set of poles out on the streets in front of our homes – a set for electric, another set for telephone, another set for cable TV, another set for Internet, and each of these multiplied to reflect the number of separate companies competing for each service.  This doesn’t happen in New Hampshire because the legislature had the foresight to pass a law saying that all service providers have to share a single set of poles.  But there’s no such rule for private transmission lines.  They can build and build, for their own profit, and as of now with their paths greased by the unconstitutional threat of eminent domain, until they destroy the beauty of our state.

This isn’t a future hypothetical problem. It is hurting real people in New Hampshire right now!

Q6. Just one last question for Part 1: I’ve heard that 648 Bragdon/Forrester would make it impossible to expand wind, power, solar and hydro and it would even become illegal to do things like erect new windmills in New Hampshire. Is that true?

A. No. That is utterly absurd, fear-mongering claptrap meant to smear 648 B/F! Hang up the phone on any nuisance call that claims that. 648 Bragdon/Forrester would no more outlaw the development of renewables than it would outlaw Wal-Mart, Staples, and Shaw’s. It would ensure, however, that none of these private developers could wrongfully take your land to build their projects. They would have to negotiate with you as an equal in an honest and straightforward manner. You can clearly see that Wal-Mart, Staples, and Shaw's have not found it impossible to build under such terms. No private utility developer who obeys the law would either.

Q. Thanks, A., for some straight talk. See you tomorrow for Part 2. There's more stuff I'd like you to explain.