What We Would Say to Northern Pass If We Could: Newsletter 3.0

You posted your Newsletter 3 to landowners today. It's another one-way communication, from you to us. If your online Journal were willing to post real responses, or if project "liaisons" were willing to give real answers, we would not be using this blog to tell you our reactions to what you have written. But you have never been willing to enter into honest dialogue with those who oppose your project. Your representatives pull out of public sessions if they discover that they must share the floor with opposition members for an actual debate. The most recent example is the upcoming Seacoast Republican Women's meeting in Portsmouth this month. Mike Skelton and Anne Bartosewicz retracted their early commitment to participate to avoid facing the opposition.

So here is what we would say to you about each of the four sections of your Newsletter 3.0 -- if we could.

"Checking In with Landowner Outreach Specialists"

Your attempt to humanize your sales people, whom you call "landowner outreach specialists," with personal interest stories is irrelevant to us. These are your employees, not our friends. Your piece belongs in an in-house publication along with shout-outs for service awards and retirements, notices about company picnics, and such. We do not hate your sales people per se; indeed, we have no interest in them one way or the other. We hate what they do for a living. Wouldn't you? They work to take our land, heritage, livelihoods, and assets from us. They are the "face" of the project that you push to the front so that Anne Bartosewicz and other "important" project personnel do not have to deal with the inconvenience of people like us, who don't buy what you are trying to sell. Take it from us, you can scrap this effort next time.

"Project Update"

You tell us about your progress in buying up land in upper Coos County. Why tell us this? Your newsletter is addressed to people with existing rights-of-way, not to those in upper Coos County.  What owners on the Lower 140 want to know is how you will update your figures about "most common tower heights" in the post-HB 648 world. On your website, before 648 was passed into law, you listed 13 towns in which you wanted to expand rights-of-way for a total of some 20 miles, and you give a "most common tower height" for each town based on those desired expansions.
 

Town	Length of ROW to be expanded (in miles)	Most Common NP Tower Heights (in feet)
Allenstown	2.6	110
Bethlehem	0.1	90
Bridgewater	0.7	90
Campton	0.13	90
Canterbury	0.2	90
Concord (Preferred)	0.76	85
Concord (Alternate)	1.7	110
Deerfield	5.23	110
Franklin (Preferred)	4.4	85
Franklin (Alternate)	0.6	85
Hill (Preferred)	0.6	85
New Hampton	0.78	85
Northfield	1.54	95
Pembroke (Preferred)	1.44	85
Pembroke (Alternate)	5.6	105
Woodstock	0.34	85

 



























Now that you have no access to eminent domain to take land for these expansions, what are the true "most common tower heights" for these thirteen towns? (And, while we're on the subject, what does "most common tower height" mean?) How tall will the tallest towers really be in Allenstown, Concord, Deerfield, where you had already admitted to 110' when you thought you could take land by eminent domain to expand ROWs? These are the kinds of things landowners want honest updates on.

"NH Transmission: Connecting Power Sources to Customers"

Thanks for the Transmission 101 lecture, but your analogy is false. Transmission towers and lines are not like long-haul truckers or trucks. 18-wheelers deliver their products and disappear. Your 135' steel towers will be there ruining our landscapes continuously and permanently, along with the subsequent towers and lines you will want to build.

 "Transmission Line Corridors: More than Poles and Wires"

You write that someone's preliminary research paper shows that cottontail rabbits and certain birds thrive on clear cut ROWs. Really? Even if it's true, are you seriously proposing this as a rationale for Northern Pass? The plague created outstanding job opportunities in 14th century England and on the continent, but the price was tragically, unacceptably steep.

If we could, what we'd finally ask you is, do you truly believe that people will fall for this newsletter?

Or is this your April Fool's joke on us?










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REAL Calls for PUC's Harrington to Resign

 On March 7, 2012, the Executive Council confirmed Michael Harrington as Public Utilities Commissioner on a 4-1 vote. Councilor Ray Burton opposed the confirmation because too many questions regarding Harrington's pension went unanswered. Harrington was formerly employed by PSNH.

Late this afternoon, Friday, March 30, PUC General Counsel Anne Ross filed an affidavit disclosing information that newly appointed Commissioner Michael Harrington refused to provide during his confirmation hearings.

Based on this disclosure, Responsible Energy Action LLC (REAL) is calling for Commissioner Harrington to step down from the PUC.

REAL's call includes Attorney Ross's affidavit and supporting documents. 

Northern Pass Makes No Financial Sense Today. Why Build It?

When Hydro-Quebec (HQ) started planning Northern Pass (NP)several years ago, gas prices were four times higher, and HQ’s hydropower had a big pricing advantage. Not so now, when today, literally, gas prices hit a 10-year low. Today, HQ’s power does not enjoy a price advantage.
                                                            
       
         Northern Pass Makes No Financial Sense Today. Why Build It?

                                                             

                                              A Guest Blog

Today's "Heard on the Street" column in the Wall Street Journal provides some interesting comparative data points on the cost of coal and gas-fired generation:

"A typical coal-fired power plant burns 10,000 British thermal units of fuel to produce one megawatt hour of electricity. With Appalachian coal costing $55 a ton, the fuel cost alone, not including transportation, is $22 per MWh. An efficient gas-fired power plant can get one MWh for 7,000 BTU of fuel. With gas at $2.24 per million BTUs, the implied fuel cost is under $16."

In short,

Gas -- $16/MWh (fuel costs only).
Coal (Appalachian sources) -- $22/MWh  (fuel costs only);

If you add 25% as a rough estimate for other operating costs, gas plants can produce at ballpark $20/MWh. This is on par with HQ's’s headline number of $22/MWh average operating cost of hydropower.

Or,

Gas -- $20/MWh (fuel cost plus operating costs);
HQ hydropower -- $22/MWh (average operating cost);

These figures comport with what the market is showing for wholesale electricity prices. As of the most recent hourly pricing report from ISO-New England (3/29/2012), NH wholesale electricity is at $27/MWh.

This is an interesting development. When HQ started planning NP several years ago, gas prices were four times higher, and HQ’s hydropower had a big pricing advantage. Not so now, when today, literally, gas prices hit a 10-year low. Today, HQ’s power does not enjoy a price advantage.

As today's "Heard on the Street" points out, the long-term trend may be toward higher gas prices if there is more demand because of coal plant shutdowns and substitution to gas, and also increased opportunity for gas exports. But if we believe the 10 cent/kWh Romaine cost per the film, "Seeking the Current,"* or even the 6.5 cent figure that HQ insists upon,** gas prices will have to go up a lot to make Romaine power competitive with gas generation.

The bottom line is that the incredible decline in US natural gas prices, and thus of US gas-fired electric generation, has taken HQ by surprise.  At current pricing, and taking into account that NP’s cost structure is grossly understated (it footnotes rather than quantifies the PSNH ROW rental payments, as just one example), Northern Pass is simply not economic.  You can’t make money selling $65 electricity into a $25 market!

If it is actually serious about pursuing NP, HQ is betting the farm on a relatively rapid increase in New England wholesale electricity prices.  We say “relatively rapid” because of the magic of compounding – the profits that HQ stands to make over the first 15 years of the 40-year NP transaction matter much more in terms of the discounted cash flow than the “out years” of 16-40.

How does one explain the fact, then, that HQ/NU/PSNH/NP appear to be moving ahead with NP, guns blazing?  It doesn’t seem to be a careful financial decision.  Rather, one could surmise that, per “Seeking the Current," HQ has been transmogrified into a “build baby build” culture, with financial considerations irrelevant or at least under weighted.  After all, as the film points out, HQ can always impose excess costs on Quebec ratepayers.

Another interesting observation from "Heard on the Street": cost of construction for a new gas-fired plant is $1MM per MWh. So, to replace NP's 1200 MW with new gas-fired generation would cost....$1.2 billion. The same as Northern Pass!

The bottom line is that we could build gas-fired capacity in New England of the same 1200 MW of electricity promised by Northern Pass (NP) for the same capital investment (likely less seeing since NP is almost certainly low on its cost numbers), and the electricity would cost the same.

Which is “worse” – destroying the Romaine River, completing the rest of the devastating Plan Nord, and ruining NH with the HVDC transmission lines, or building the gas plants and making upgrades to the existing grid as needed? For the carbon implications, the Conservation Law Foundation's and HQ’s own research on the carbon impacts of new hydropower show that there is no net gain over natural gas for at least 10 years.

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*The next NH screenings of the documentary film, "Seeking the Current," are in Keene (April 5) and Bethlehem (May 24). CLF will lead discussions after the film.

**See HQ's Myth #8.