CONCORD — The battle over biomass is far from over.
Eversource now says it will not purchase power from the state’s wood-burning power plants despite a state law requiring such purchases, unless it is ordered to do so by the Public Utilities Commission.
The decision by the state’s largest utility, revealed in a Dec. 4 filing with the PUC, comes after a year-long debate in the state legislature over the so-called biomass bill, SB 365.
A gubernatorial veto was overturned; a challenge to the new law was filed before the Federal Energy Regulatory Commission; and now Eversource is balking at playing its role in the new power purchase scheme designed to prop up the biomass power plants and the forest industry that fuels them.
“Eversource decided not to enter into any formal power purchase agreements under SB 365 in order to preserve its rights (under federal law) in the event that the legality of SB 365 is challenged,” according to the utility’s Dec. 4 petition to the PUC.
The state’s largest utility is ignoring a directive of the state Legislature, at least for now, because the new state law puts it at odds with federal law, according to an Eversource spokesman.
“We are committed to providing our customers with the lowest rates possible while working within the bounds of state and federal law,” said William Hinkle.
“Given the uncertainty surrounding this legislation, Eversource has followed the requirements of SB 365 in a manner to protect the interests of all until a final decision is reached. As a regulated utility, we will comply with the operative decisions of FERC and the Public Utilities Commission.”
A representative of the forest industry said the uncertainty has been created by the opponents of the new law.
“The people have spoken through the legislative process and they (Eversource) should follow it to the letter,” said Tom Thomson of the Thomson Family Tree Farm in Orford. “For Eversource to do anything but that makes them nothing but hypocrites.”
The son of former Gov. Meldrim Thomson has warned that his family and many others would have to starting selling house lots instead of growing trees if the wood-burning power plants close and foresters lose their market for low-grade wood.
The bill became law in September over the veto of Gov. Chris Sununu. He argued that forcing the utility to purchase wood power at higher-than-market prices foists those higher prices on electric ratepayers already burdened by some of the highest electricity costs in the nation.
Eversource estimates that the cost of the biomass energy would be 3 to 4 cents per kwh higher than average wholesale rates in the New England region, given the lower price of natural gas during all but the coldest days of the year.
Despite Sununu’s attempted veto, the state Attorney General is defending the law in the FERC proceeding.
Supporters of the measure rallied for the forest industry, which needs a buyer for the byproduct of its harvest, and the biomass plants, which provide good jobs and renewable energy.
“The Legislature found it to be in the public interest to promote the fuel diversity represented by these renewables as part of the state’s overall energy policy,” according to a recent letter from 10 prominent senators and state reps to FERC.
The group, led by outgoing Senate Majority Leader Jeb Bradley and House Speaker Gene Chandler, urges FERC to reject the petition by the New England Ratepayers Association.
The ratepayer group argues that SB 365 is preempted by federal law that prohibits states from setting wholesale rates for electricity.
The lawyer appointed by the state to represent consumers in utility issues, Don Kreis, has also weighed in against the new law. He applauded the decision by Eversource.
“The Office of Consumer Advocate is pleased by Eversource’s efforts to preserve its customers’ financial rights under (federal law),” wrote Kreis in a FERC filing of his own on Monday.
“The statute’s preferential treatment of biomass and municipal waste facilities can hardly be viewed as promoting all forms of renewable energy, or fuel diversity or sound resource planning,” according to Kreis. “It is, quite simply, a mechanism to subsidize certain in-state (power plants) at the expense of Eversource customers.”
Also on Monday, attorneys representing the power plants, known collectively as the New Hampshire Generator Group, added their own defense of the law to the stack of paperwork piling up at FERC.