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Energy Policy, US Senate Gets It. Do we?

It seems ironic that 11 of New England’s 12 U.S. senators were among the 85 who voted on April 20 for a comprehensive, all-resource bill that streamlines permitting of natural gas pipelines and electric transmission lines and supports natural gas exports.  It’s ironic because in New England, pipelines and transmission lines are about as popular as mosquitos. 

It happened the same day Kinder Morgan bailed on its plans for a $3 billion, 188-mile pipeline project citing lack of signed agreements with customers.  Kinder Morgan’s Northeast Energy Direct project was also the subject of intense opposition from officials in several states, as well as communities through which the pipeline would have traveled. 

What’s striking about the U.S. Senate’s vote is that a supposedly dysfunctional Senate came together on a bill that encourages and supports fossil fuel development, as well as a basket full of renewable resources, energy efficiency, electric grid improvements and even workforce development in energy industries. 

New England appeared heading down a similar path. The region’s governors in recent years agreed on the need to relieve gas pipeline constraints that were keeping low cost gas to the west from reaching New England during critical high-demand periods.  That need is no less today, but political support for natural gas seems to be wavering even as important legislation to encourage imports of hydropower from Canada moves forward.

ISO New England, the regional electric grid operator, continually flags the fact that nearly one-third of the region’s electric generating capacity is likely to retire in coming years.  Canadian hydro will help but much of the planned replacement capacity will be from new natural gas-fired plants.   Kinder Morgan’s decision to cancel its New England project has cut the region’s gas distribution options by about half.  That, along with the upcoming closure of Pilgrim Nuclear Power Station, makes the need for remaining pipeline projects, such as the ones proposed by Spectra Energy, critical. 

A study last year by Daymark Energy Advisors for the New England Coalition for Affordable Energy found that investments in a combination of new transmission lines to bring hydropower from Canada, new and expanded natural gas pipelines and onshore wind -- built and in service by 2020 -- could avoid $5.4 billion in higher energy costs and save more than 160,000 jobs throughout New England.

Unfortunately, climate change goals are superseding concerns, especially among major businesses, about the impacts of higher and more volatile energy prices in the future on regional competitiveness and jobs.

Among members of the New England Coalition for Affordable Energy are the region’s major business organizations.  Most of those organizations, and their members, support renewable energy and share concerns about climate change. They are also responsible for hundreds of thousands of jobs.  Many operate in highly competitive national and international markets.  Virtually all depend on affordable and reliable energy around the clock, every day of the year to maintain competitiveness.  For most, intermittent power is not an option.

In time, renewable energy, including offshore wind, energy storage and decentralized grids may provide that level of reliability.  But not in the next five to ten years when new and expanded natural gas pipelines should be bringing more low cost gas from the west and electric transmission lines should be tapping hydropower from Canada, as well as delivering more wind power.   

Public officials at all levels should recognize that New England businesses need to be reassured that energy policy leaders will not ignore near-term warnings and statements of need from organizations such as ISO New England for the sake of a long-term vision built around renewable energy.  As admirable as it may be, that long-term vision may not be achievable in the absence of more affordable and uniformly reliable energy in the years immediately ahead to help ensure continuation of a strong, vibrant and growing economy.