Damper
on new
business
If Maine believes development of alternate sources of energy is important, it should fund research directly from the general fund or with tax credits.
It should not double the existing 75 cent monthly surcharge on our electric bills, as has been proposed in the Legislature.
Maine already suffers from high energy costs because there is next to no market competition. Chambers of commerce frequently cite high electricity costs as enough reason to keep new businesses from moving here and, even though we were promised lower rates, we are paying more for the combined production and delivery of electricity than ever before.
The Legislature is considering a number of measures to boost alternative energy research and development, find ways to enhance heating and cooling efficiency through new technologies, and reward companies that generate electricity from fuel cells, wind power, solar power, biomass, landfill gas and tidal power. These are strategies worth debating.
However, funding a Clean Energy Fund with a monthly $1.50 surcharge on every personal and commercial electric bill is a bad idea.
Establishing a Clean Energy Fund is a fine idea and much needed, but there are other ways to raise this money through direct funding or incentives. Simply raising surcharges on electric bills would essentially make bill collectors out of Central Maine Power Co. and other power companies. The result might be a steady flow of funds for energy R&D, but it will also raise our electric bills. No one wants that – not even power companies.
Mainers already subsidize NUGs – nonutility generators like biomass, hydro and waste-to-energy facilities – through electric rates.
NUGs were put on the market during 1998’s deregulation but no buyers came forward, surprising industry analysts who had anticipated intense bidding. Had the NUGs been sold at or above market price that would have helped lower our so-called stranded costs. But that didn’t happen, and power companies were obliged to honor contracts they had with these generators so our stranded costs remain high and we continue to pay down that debt.
In addition, the Public Utilities Commission permits suppliers to purchase power from NUGs at pre-deregulation contract prices, which has artificially raised delivery costs, according to the Office of the Public Advocate.
Maine needs greater competition among focused alternative energy sources. However, the continued subsidies that support NUGs are already elevating electricity costs and increasing our monthly surcharge. This proposal would further increase the burden.
There probably are customers who don’t even know they’re already paying a 75 cent surcharge and would not likely notice its doubling. But there are plenty of customers who will.
A $1.50 a month surcharge, or $18 a year, doesn’t sound like much. But figuring the surcharge across Maine’s private and business customers amounts to tens of millions of dollars a year in added electricity costs.
These higher costs make Maine less attractive at the precise time we are attempting to attract new economic development and increase our population.
It is not the intent of the legislation to put a damper on Maine’s economic strength, but that would be the result.
jmeyer@sunjournal.com
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