On top of an announcement last week that Mainers will be asked to pay $300 million for more electricity generation the state doesn’t need, the New England power grid Maine belongs to is slapping on another $20-million transmission fee hike, effective July 1.
That rate hike mainly will affect big power users like the state’s paper mills that buy directly off the transmission lines, according to Phillip Lindley of the Public Utilities Commission. Like the generation fee, it is largely paying for construction that won’t directly benefit the state.
“Only $3 million of the construction is in Central Maine Power territory,” Lindley said. He did not yet have a number in Bangor-Hydro Electric territory, but said the bulk is for out-of-state construction.
The transmission hike is insult to injury given the news that Maine consumers will pay more than $300 million over the next four years for new electric power plants the state doesn’t need. Maine already generates twice as much power as it uses, but because it is a member of the New England Power Pool it is required to chip in for the needs of its neighbors.
That $300 million, approved by the Federal Energy Regulatory Commission (FERC) last week, translates into a 6 percent or $60-a-year average increase for residential customers and a 10 percent hike for Maine’s medium and large commercial and industrial electric users.
Maine Sen. Susan Collins said Tuesday the FERC ruling wasn’t fair and called the $300 million an “unacceptable increase.”
“It is clear to me that FERC made its decision to raise electricity rates in New England without properly taking into consideration the impact on Maine ratepayers. Maine does not have the capacity problems that exist in other states yet FERC plans to require Maine homeowners and businesses to shoulder an unfair burden,” Collins said in a statement.
Her spokesperson, Kevin Kelley, said Collins plans to contact FERC Commission Chairman Joseph Kelliher and request the decision be reversed.
Kurt Adams, chairman of the Maine Public Utilities Commission, in announcing the FERC decision, said the money was going to companies already making record profits.
“At a time when Maine’s economy is struggling to get ahead, this unprecedented rate hike is simply astonishing,” he said. “Of equal concern is that Maine ratepayers are being asked to bear these costs in light of FERC’s recognition that we have surplus generation.”
The money will be used to increase generating capacity largely to serve northeastern Massachusetts and southwestern Connecticut.
While Maine belongs to the New England Power Pool to assure uninterrupted electric service in the years ahead, the state is questioning the cost of that arrangement. A study requested by Gov. John Baldacci is already in the works to consider alternatives, including pulling out of the pool. Some have suggested Maine should hook up with power grids in Canada.
The PUC could appeal the FERC ruling, but no date has yet been set for that discussion, Lindley said.
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