Is this the best solution?
I don’t like Central Maine Power. Nowadays, it seems that at least half of Maine doesn’t like them, either. Between past billing issues or their seeming inability to maintain the grid and invest in this important infrastructure, CMP has not impressed me or anyone I know.
Ten years ago, I was chairman of the Efficiency Maine Trust. We dealt with CMP and other power companies regularly, and I always felt that they did whatever they could to be difficult and unhelpful. It seems to me that when you have a state-sanctioned monopoly and are guaranteed a return on your investment of between 10 percent and 12 percent, which they are by statute, that you have some obligation to at least try to provide good service. It appears that they never got that memo.
I, along with my two business partners, run Lee Auto Malls, employing roughly 400 people. Managing a business is hard. Managing people is hard. CMP has 1,000 employees, serving over 500,000 customers in an 11,000-square-mile footprint. I am not about to make excuses for them; however, I am going to suggest that the current proposal to have some nonprofit entity buy them is well intentioned and perhaps misguided.
(In the interest of full disclosure: Rep. Seth Berry, author of L.D. 1708, the bill to create the Pine Tree Power Co., is a friend; Willy Ritch, who runs Maine Affordable Energy, which opposes L.D. 1708, is a friend, and David Flanagan, executive chairman of CMP, used to be on Lee Auto Malls’ board of directors and is a friend as well.)
Yes, at least this new nonprofit would have to make payments in lieu of taxes, so at least we wouldn’t lose out on any property tax revenue.
But here is why I think the proposal is a mistake. Even taking CMP’s guaranteed profit from 12 percent down to 2 percent, freeing up millions and millions of dollars, does not guarantee that the company will be run any better than it is now. The idea of having a publicly elected board oversee the hiring of another company, which that will somehow magically come in and fix all of the issues we have and magically improve everything CMP does, is just not going to happen. It is completely unrealistic.
I know there are many examples of a “publicly owned utility” that has good service and happy customers. Kennebunk Light & Power is often mentioned. I would point out that Kennebunk Light & Power was founded in 1893 as a department of the town of Kennebunk and currently has 29 employees. It serves 6,000 people versus CMP’s 560,000. This is not a comparison that makes any sense at all.
While Maine may have high electric rates, we have the lowest rates in New England and the cleanest energy. We don’t burn coal in Maine, and if you don’t burn coal, your rates are going to be higher. (We shouldn’t burn coal, because it is not good for the environment)
I would suggest that the Public Utilities Commission could play a more active role in regulating CMP and forcing them to uphold their end of the bargain by investing far more in improving our grid. Perhaps with enough aggressive enforcement, Avangrid might decide to sell CMP to some other large utility that has proven it can do the job of delivering electricity and maintaining the grid.
In the next five to 10 years, we are going to need to invest billions of dollars in our grid. As we slowly make the transition to electric cars, heat pumps and solar, demands on the grid are going to increase dramatically. Do we want a publicly elected board to be making these decisions? I don’t think so.
This column was changed at 11:55 a.m. Tuesday, June 29, 2021, to correct the description of Willy Ritch, and at 3:30 p.m. to reflect the correct information on the property tax obligations of the proposed Pine Tree Power Co.
Send questions/comments to the editors.
