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June 12. 2012 10:46PM
Northern Pass project not a money maker?
Electricity prices in New England could be 2 or 3 percent lower than initially projected by Northern Pass, making it hard for owners to generate a profit, potential competitors said Tuesday.
The New England Power Generators Association warned that could prompt the 1,200-megawatt project to demand consumer subsidies.
“Virtually every utility in the region has seen a price decrease. We want to make sure that the level playing field persists and allows for in-region investment that drives jobs,” said Dan Dolan, president of the organization.
Northern Pass said it has not sought subsidies, and large-scale hydropower does not qualify under the three-tier system New Hampshire has for energy credits.
“NEGPA is desperate to stop the Northern Pass. It knows that a more competitive and reliable supplier will enter the market and negatively impact its members' profits,” said Martin Murray, spokesman for the Northern Pass project and senior corporate news representative for Public Service of New Hampshire.
Northern Pass proposes to run a 180-mile high-voltage transmission line through the state to import hydroelectric power from Quebec. The project is a partnership between Hydro-Quebec and Northeast Utilities, the parent company of PSNH.
NEPGA represents companies that generate nearly 27,000 megawatts of electricity in New England, about 85 percent of the region's power output.
The organization said that the development of natural gas-fired plants has led to lower power prices than projected by Northern Pass consultants two years ago.
A NEPGA-funded study released Tuesday predicts a 2 to 3 percent drop in New England power prices, which would make it hard for Northern Pass investors to see a profit.
“That is fine if the folks in Quebec want to subsidize power here,” said Dolan. But if Northern Pass seeks renewable energy credits or some form of subsidy, NEPGA would have a problem, he said.
Small-scale hydro producers, most of whom belong to NEPGA, do qualify for the lowest tier of energy credits for renewable power producers.
“When the full economic costs of the power delivered over the (Northern Pass) line are considered,it becomes clear that the power is quite costly,” Dolan said.
Murray said some of NEPGA power producers would be priced out of the market if Northern Pass is installed.
He said: “Our project will be successful if it is cleaner and more economic than what is in the power pool.”
Paula Tracy may be reached at ptracy@unionleader.com.
The New England Power Generators Association warned that could prompt the 1,200-megawatt project to demand consumer subsidies.
“Virtually every utility in the region has seen a price decrease. We want to make sure that the level playing field persists and allows for in-region investment that drives jobs,” said Dan Dolan, president of the organization.
Northern Pass said it has not sought subsidies, and large-scale hydropower does not qualify under the three-tier system New Hampshire has for energy credits.
“NEGPA is desperate to stop the Northern Pass. It knows that a more competitive and reliable supplier will enter the market and negatively impact its members' profits,” said Martin Murray, spokesman for the Northern Pass project and senior corporate news representative for Public Service of New Hampshire.
Northern Pass proposes to run a 180-mile high-voltage transmission line through the state to import hydroelectric power from Quebec. The project is a partnership between Hydro-Quebec and Northeast Utilities, the parent company of PSNH.
NEPGA represents companies that generate nearly 27,000 megawatts of electricity in New England, about 85 percent of the region's power output.
The organization said that the development of natural gas-fired plants has led to lower power prices than projected by Northern Pass consultants two years ago.
A NEPGA-funded study released Tuesday predicts a 2 to 3 percent drop in New England power prices, which would make it hard for Northern Pass investors to see a profit.
“That is fine if the folks in Quebec want to subsidize power here,” said Dolan. But if Northern Pass seeks renewable energy credits or some form of subsidy, NEPGA would have a problem, he said.
Small-scale hydro producers, most of whom belong to NEPGA, do qualify for the lowest tier of energy credits for renewable power producers.
“When the full economic costs of the power delivered over the (Northern Pass) line are considered,it becomes clear that the power is quite costly,” Dolan said.
Murray said some of NEPGA power producers would be priced out of the market if Northern Pass is installed.
He said: “Our project will be successful if it is cleaner and more economic than what is in the power pool.”
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Paula Tracy may be reached at ptracy@unionleader.com.