State utility regulators, citing differences over cost, have terminated an agreement for a proposed transmission line that would have brought wind power from northern Maine to the New England grid.
Philip L. Bartlett II, chairman of the Maine Public Utilities Commission, said at the agency’s meeting Thursday that the developer, LS Power, informed regulators that it “can no longer hold to its price” for the transmission line that would extend up to 160 miles. It did not spell out a revised price, he said, and details of the confidential negotiations are not available.
“This is a nonstarter,” Bartlett said.
He said a contract “at a minimum” would be required to include a binding price.
“It would be fundamentally unfair to other bidders to permit any adjustment to price, much less a non-specified one,” Bartlett said. “By changing the price, knowing that the commitments in the approved term sheet were binding, LS Power has effectively withdrawn its original bid.”
“I surely understand that this is a frustrating outcome for all involved,” he added.
Bartlett said the PUC will terminate the procurement and initiate a new one, which will add another delay to a project that has been moving slowly already.
The cost of the transmission line, when completed, will be paid for by utility ratepayers over a period of many years.
Commissioner Pat Scully said LS Power insisted on provisions on prices and contingencies that would “shift a substantial amount of risk” and potential costs to ratepayers.
Douglas Mulvey, vice president of LS Power, said the New York-based developer is disappointed in the PUC’s decision, “especially given the significant economic and environmental benefits our project would provide to ratepayers and the state.”
“Ultimately, the additional requirements and risks that were not included in our 2022 bid that we were being asked to absorb within the contract became hurdles we could not overcome,” he said.
Mulvey said the project is the best way to “cost-effectively deliver Maine-made clean energy” and LS Power remains open to working with the Legislature and PUC to “improve the procurement process to address the untenable issues that arose in the past procurement.”
Dan Burgess, director of the Governor’s Energy Office, said the administration will “closely evaluate this outcome and engage with partners and stakeholders about the future of the Northern Maine program.”
Chad Allen, director of development at Boston-based Longroad Energy, the developer of the wind farm in northern Maine that would generate the energy to be transmitted along the power line, said the company is still reviewing the PUC’s decision.
“(Longroad) is committed to the development of King Pine Wind and continues to advance project development, including performing surveys, studies and engineering required for project planning and permitting,” he said.
Jack Shapiro, climate and clean energy director at the Natural Resources Council of Maine, said developing the “large, untapped wind resource in Aroostook County is an urgent step toward averting the worst impacts to our state by accelerating the transition to lower-cost, Maine-made clean energy.”
The PUC had estimated that the wind-power transmission project and King Pine wind farm of 179 turbines west of Houlton would cost ratepayers $1 billion for a 60% share of the electricity output, adding $1 a month to a typical residential electric bill for 10 years. The cost would be offset by the project’s economic and environmental upside, the commission has said.
Massachusetts has committed to buying the other 40% of the project’s power.
“We’re disappointed that this project has hit a roadblock,” said Elizabeth Mahony, commissioner of the Massachusetts Department of Energy Resources. “The Healey-Driscoll administration will continue to pursue additional regional transmission solutions to support the development of clean and renewable energy. Increasing the region’s supply and ability to deliver clean, reliable, and affordable energy will lower energy costs for residents and businesses, help address New England’s winter energy challenges and reduce our dependence on expensive, imported natural gas.”
Bartlett said “significant differences have persisted” among the parties and PUC staff, and LS Power was directed to file a proposed transmission agreement with information quantifying the project’s benefits.
The PUC will consider “what changes, if any, could be made to the process to increase the likelihood of success,” he said.
Jeff Marks, executive director of ClimateWork Maine, a group of businesses and business leaders, said the state has “robust renewable energy generation targets,” but is not building transmission lines at the pace and scale needed to keep up with its clean energy goals. He called on state to improve the planning process.
Mulvey, the LS Power executive, said in November that additional efforts to advance the project were on hold as developers waited on state regulators to sign purchase and service agreements. At that time, he said there was “no certainty” the project would happen.
The transmission line plan has drawn opposition from some landowners and officials in northern Maine, where “Keep LS Power Off Our Land” signs popped up along highways and in store windows. Opponents say they worry about towering transmission lines marring their views, while others criticized the process used to site the project.
Unity residents in mid-November passed a moratorium against high-voltage power lines in town, giving the town more time to write local ordinances. Many other towns have done the same.
The Northern Maine Renewable Energy Development Program was the result of a 2021 state law intended to remove obstacles and promote the development of renewable energy resources in northern Maine.
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