Ratepayer Advocates of NH, MA, ME, and RI Speak Out

Concerned about runaway spending on so-called “Asset Condition” transmission projects, the ratepayer advocates of New Hampshire, Maine, Massachusetts, and Rhode Island have today called for a moratorium on most new projects until new processes are in place to assure that these massive expenditures receive the public scrutiny they deserve.

“There are approximately $5 billion in ‘asset condition’ projects currently proposed, planned, or under construction – an amount that increased by 50 percent within the last six months,” said the joint memorandum issued by the ratepayer advocates.  “These impending rate increases pose significant, incremental cost burdens on New England ratepayers, who are already struggling to pay very high electricity prices.”

The call came via a memo that was addressed jointly to the Planning Advisory Committee (“PAC”) of ISO New England, which runs the region’s bulk power transmission system, as well as the investor-owned utilities that actually own the system.  ISO New England also oversees the markets for wholesale electricity in the six states.

“Asset Condition” projects are those that involve existing, rather than new, transmission facilities.  The ratepayer advocates noted that proposed new transmission facilities undergo holistic assessment to determine whether they are necessary, and they called for the PAC and the transmission-owning utilities to adopt a similar process for Asset Condition projects.

“The New England Consumer Advocates recognize that aging transmission facilities may require replacement,” the memorandum stated.  “However . . . it is critical that Asset Condition projects also be subject to consistent and transparent planning standards to assure that ratepayers are not paying for unneeded facilities.”

The ratepayer advocates also drew attention to a problem that arises out of how New England’s transmission costs are allocated to retail electric customers.  According to the consumer advocates, “the primary focus of each [transmission owner] will be on the portion of spending within their respective service area” and “a significant portion of each [transmission owner’s] spending will be paid for by out-of-state ratepayers.”

The transmission-owning utilities in New Hampshire are Eversource, which also serves retail customers in the Granite State, and National Grid, which does not.

“[A]ll ratepayers will be adversely impacted if each [transmission owner] takes the approach that its individual share of this spending will not only substantially benefit the utility’s shareholders, but also have only a modest impact on its ratepayers,” said the consumer advocates.  Thus, they wrote, “all stakeholders, including the New England Consumer Advocates, need the opportunity to assess the reasonableness of each [transmission owner’s] planned spending in terms of the timing and scope of each project to ensure they comply with objective standards and criteria.”

The moratorium requested by the consumer advocates would cover “all non-emergency and/or elective Asset Condition Projects that have yet to start construction.”  It would last “until the asset condition reform process at the PAC is completed and replaces the current process.”  The moratorium would affect an estimated $2.6 billion in proposed and planned Asset Condition projects as well as eight “concept-level” projects whose costs have not yet been estimated.

The consumer advocates lauded the New England States Committee on Electricity – NESCOE – for its leadership in drawing attention to the lack of oversight for Asset Condition project spending.  NESCOE represents the interests of the region’s governors before ISO New England and is governed by six managers, one for each state.  New Hampshire’s manager, designated by the Governor, is Energy Commissioner Jared Chicoine.

“Like my colleagues around the region, I am extremely grateful to NESCOE for pursuing reforms related to Asset Condition projects,” said New Hampshire Consumer Advocate Donald Kreis.  “This is a key part of our ongoing effort to work collaboratively with Commissioner Chicoine and his staff on regional initiatives that will make sure New Hampshire pays its fair share of the costs associated with our electricity grid and not a dime more.”

In that regard, Kreis noted that the Office of the Consumer Advocate has begun recruiting to fill its newly established post of Director of Regional and Federal Affairs, authorized via the state’s biannual budget approved earlier this year with the support of the Governor.  “We are looking for an attorney who wants to become a bold and knowledgeable presence in regional forums, speaking on behalf of New Hampshire’s residential ratepayers,” said Kreis.  Persons interested in the position are invited to contact the Consumer Advocate directly via the e-mail address or phone number listed above.