New law aims at electricity savings

Blethen Maine Newspaper
June 12, 2600

Gov. Baldacci has signed into law Maine's first major piece of energy legislation since 1997, when the state restructured its electricity industry.

If successfully implemented, the new law will stabilize electricity rates, encourage economic development and help to protect our local and global environment by reducing Maine's dependence on electricity made from fossil fuels.

The law, titled "An Act to Enhance Maine's Energy Independence and Security," does three things:

# It allows the Public Utilities Commission to take Maine electricity users out of the volatile short-term electricity markets now being driven by the high cost of natural gas power plants.

# It places clear policy priority on the development of energy efficiency and renewable resources.

# It stimulates the development of energy-related jobs.

The law also provides a one-year reduction from state taxes imposed on bio-diesel fuels.

It has been almost a decade since Maine decided to rely on competitive electricity markets, in which all customers were expected to exercise retail choice in selecting their own electricity providers.

As it turns out, few customers other than large industrial customers ever had the opportunity or interest in selecting an electricity provider.

The vast majority of Maine electricity customers have remained on what is called "standard offer service" arranged by the PUC. (A small percent of customers have selected a cleaner electricity product offered by Interfaith Power and Light, but they have been the exception.)

The standard offer service is made up of three fairly short-term (three-year) contracts for electricity service which are priced very close to the short term market price for electricity in the New England regional market.

These rates have been escalating steeply in the past two years as they tend to reflect the cost of generating electricity from natural gas. Prices for natural gas have more than tripled in this same time period.

Maine's new energy law will take electricity customers out of this volatile short-term electricity market by allowing longer-term purchases of electricity energy and capacity and by allowing Maine's familiar distribution companies, Central Maine Power, Bangor Hydro Electric and Maine Public Service, to play an increased role in acquiring long-term electricity resources.

The law creates a priority when shopping among available cost-competitive electricity re- sources with energy-efficient measures coming first, followed by renewable resources and, only after they have been acquired, looking to more traditional fossil-fuel technologies.

This list of priorities conforms to today's realities of averting further climate change by avoiding unnecessary emissions of greenhouse gases from the burning of fossil fuels to make electricity.

The energy law specifically requires that the share of new renewable resources as a percentage of total electricity capacity in Maine be increased by 10 percent by the year 2017. Adding these new renewable resources will help to stabilize electricity costs well into the future.

Stepping away from dependence upon electricity made from fossil fuels is the right thing to do. The energy-efficiency savings potential in Maine remains very large and is literally lying at our feet, there for the taking.

Using more efficiency and a greater proportion of electricity generated from renewable resources will stimulate local jobs throughout Maine related to these two "clean" industries.

This farseeing energy law represents hard work by many stakeholders, each with a vested interest and each with its own view of what was needed by way of relief from rising electricity costs.

It is encouraging to know that with effective legislative leadership, consensus on difficult and complex questions affecting the public good can be reached.

The new energy road map is a good one. Now let's hope our public leaders can effectively move us along to the envisioned destination.