Should Electricity Ratepayers Pay for New Natural Gas Pipelines in Massachusetts?

, Senior energy analyst | February 24, 2016, 3:41 pm EDT
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In a recent post on Massachusetts’s electricity mix—past, present, and future—I flagged natural gas as a fuel that the state has already become dependent on in a big way, and something we have to be careful about not over-investing in. It turns out that this is a clear and present issue in Massachusetts, and that this is the week to do something about it. And there are plenty of reasons to think that the path the state seems headed down on natural gas is not the way to go.

Eversource, one of the state’s large utilities, has asked the Massachusetts department of public utilities (DPU) for permission to make its electricity ratepayers foot the bill for new natural gas pipeline infrastructure. The utility’s filing comes after the DPU authorized this type of action, and the DPU is taking comments on the Eversource proposal this week.

But this idea brings up a lot of questions. Here are a few:

Massachusetts is a “restructured” state… so why am I having to pay for a particular fuel?

Massachusetts overhauled its electricity sector almost two decades ago. A big part of restructuring was separating electricity generation from electricity distribution. That means that your electric utility—the company that owns the wires leading up to your house and bills you each month—doesn’t own the power that supplies you; it just passes through to you the costs based on whatever electricity supplier you’ve chosen.

So the idea of you paying for natural gas pipelines supplying power plants that you might not even sign up to get power from—an investment in infrastructure that might not even serve our broader long-term needs—is… odd.

There are plenty of indications that Massachusetts doesn’t actually need the pipelines that are being proposed. Photo:

There are plenty of indications that Massachusetts doesn’t actually need the pipelines that are being proposed.

Have we done this before?

Er, nope. The office of state Attorney General Maura Healey questioned the legality of what the DPU was considering when this issue first came up. And here’s how it reacted to the DPU’s authorizing decision:

“The Attorney General’s Office is concerned that the Department of Public Utilities’ (DPU) order for the first time authorizes electric distribution utilities to enter into long-term capacity agreements to facilitate gas pipeline expansion—and shift the substantial costs and risks of such long-term investment in pipeline infrastructure to electricity ratepayers.”

Do we even need more pipelines?

That’s a key question. And the answer is: probably not. At least, there are plenty of indications that we don’t actually need the pipelines that are being proposed, that there are other, more attractive ways to go about this, ones less likely to lock us in to costs—and emissions—that we aren’t going to want.

Notably, a report commissioned by the AG Healey’s office found that “the region can maintain electric reliability through 2030, even without additional new natural gas pipelines.” A better answer, they showed, is “cheaper, less carbon intensive ways to ensure electric reliability, like energy efficiency and demand response, that are less risky for ratepayers.”

Another useful analysis, carried out for the Conservation Law Foundation, also came to the conclusion that new pipelines aren’t the way to go (emphasis added):

“One proposed solution is to ‘flood the market’ with new gas via one or more new pipelines, with the multi-billion dollar cost to be borne by electric ratepayers. The other solution… is to maximize the use of existing infrastructure in both the delivery and storage of natural gas… [A]dding additional pipeline capacity is the most expensive and least effective means of addressing New England winter-peak deliverability.”

What the attorney general’s study found. (The rest of this infographic is available here.)

What the attorney general’s study found. (The rest of this infographic is available here.)

Your turn

Eversource isn’t the only Massachusetts utility looking to have its electricity customers pay for pipelines (National Grid, for example, is trying it too), but it’s the first to come up at the DPU.

In a perfect world, the science would guide the decision making on stuff like this, and we’d be all set. But sometimes science needs a little help. If you want to weigh in on the side of science to help Massachusetts reach a rational decision about where we go with natural gas, now’s your chance.

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  • Tribalscribal

    How can you even ask that question?? The proposed Kinder Morgan (Son of Enron – look it up) fracked gas pipeline is a corporate export scheme. Very little of the gas will be used in Massachusetts. No real public good is served and Corporate America and its enablers in government want us to pay for it! Ha,ha,ha,ha,ha,ha,ha,ha…….

    • ucsjrogers

      I think the most immediate issue, Tribal, is who’s going to be on the hook for risky bets on any new natural gas infrastructure. It’s one thing for private money to be gambling away their own currency; it’s quite another for them to be using our money. You’re right that there’s a broader question, too, about public good, and what rights pipeline developers should have to take private land for a pipeline (eminent domain) that we might not even need. Thanks. – John

  • CommentorinChief

    The environmental movement is killing what little number of jobs remain or could be created through lower, more reliable long term energy costs. By 2020 over 60,000 MWs of coal fired power generation will have been retired/shuttered in New England since 2012. Some of this was due to lower natural gas costs but the huge majority was due to government environmental policy that refuses to consider the negative economic consequences of it ideological, anti-carbon, anti-growth movement.

    The dire warnings of catastrophic climate change, based on consistently inaccurate climate models with hundreds of subjective variables, have proven over and over again to be nothing more than the tool of choice to destroy the economy, jobs and livelihoods of New England’s citizens. Now that the Obama administration has effectively killed off the coal industry, the level of carbon emissions into New England has dramatically dropped. We now hear from the environmentalists and media that the natural gas power plants needed to replace the massive coal plant retirements are also too dirty to be allowed. So the protestations continue although natural gas is the cleanest form of abundant energy available.

    When will the elite, the rich, and the progressive politicians that so often profess to care about the poor and working class citizens of New England lift their boot off the neck of industry? Environmentalists care nothing for the lives of New Englanders. They are radical ideologues that would rather you and your children starve to achieve some Utopian carbon free fantasy.

    • Tribalscribal

      We hear if you sail far enough out you will fall off the edge of the planet.

    • ucsjrogers

      I appreciate your concern, Commentor, but I think you’re definitely going to want to check your sources, or your sources’ sources. The coal retirement figure you cite is off (too high) by at least a factor of ten. And, while I’d love for clean energy to be able to take the bulk of the credit, I think you’re giving natural gas short shrift in terms of killing off coal in the region.

      Nationally, coal is far from dead; the final 2015 figures are likely to show that it and natural gas are neck and neck, and that together they add up to more than 70% of our electricity supply.

      But the direction coal is heading — down — is really important. Because another thing you’re going to want to go back to your sources (or better ones) on is climate science. There are many (many) indications of climate impacts, of all sorts, on land and in the sea, at both ends of the temperature scale and everywhere in between.

      Don’t take my word for it: Check out the science. Please. Find a reputable source, look behind the curtain to see where that source is getting its information (and funding) from, and see what’s really up, or down, or haywire.

      And maybe listen to the World Economic Forum — not really thought of as a bastion of environmentalism — when they put climate risk at the top of their list of threats facing our economy:

      None of us is served well by making decisions based on bad information. it’s worth looking for facts.

      – John

  • ucsjrogers

    We welcome wisdom from anywhere, solodoctor. What’s happen in Massachusetts mirrors, in different ways, what’s going on elsewhere, and there are lessons to be learned all over. So fire away!

  • solodoctor

    Is it helpful for non Mass residents like me to send in a comment?