Sunday, March 9, 2014
Gov. LePage’s energy policy is relatively straightforward: lower Maine’s energy costs in order to reduce financial burdens on individuals and businesses, increase Maine’s competitiveness and grow the state’s economy.
So far so good.
But a key tenet of that policy includes open hostility toward most renewable energy sources because of their historic inability to produce electricity at costs competitive with conventional sources. As a result, the governor simply has no use for them.
But with land-based wind, the rationale for the governor’s opposition is quickly crumbling. The Boston Globe reported a remarkable milestone Sept. 23: “Wind power now competitive with conventional sources.”
The delivered cost of wind has declined over 50 percent in the last four years, driven largely by significant technological advances and long-term power purchase agreements that enable more attractive financing. That means wind can now generate electricity at costs at or below coal, oil, nuclear and even hydro, with associated savings passed on to ratepayers.
The overarching rationale for wind power, then, is shifting from domestic, carbon-free “green” energy to competitive generation capable of saving consumers and businesses money.
So, given wind’s new-found competitiveness and cost suppression benefits, one might logically expect the governor to embrace the industry for its potential to lower energy costs. But one would be wrong.
Despite his claims to the contrary, the governor is actively engaged in picking winners and losers in the energy space, with wind ideologically and permanently confined to the loser category. The winners, by comparison, are large-scale Canadian hydro power and natural gas.
To be clear, both hydro and natural gas have important roles to play in our generation mix. In fact, over 50 percent of the region’s energy is now produced using natural gas. The fuel is abundant, clean burning, cheap and largely responsible for declining energy costs. Companies are racing to deliver it to homes and businesses, and build additional capacity into the region.
What’s more, cheap natural gas compelled generators of all stripes, including wind power, to accept lower prices for their energy, driving innovation that now allows fewer turbines to produce more power, more efficiently.
Meanwhile, with its ready supply of excess capacity, Canadian hydro power can contribute stable, predictable, market-rate generation to the region’s energy mix. One critical challenge, however, is creating the interconnections and transmission lines capable of getting this power to market, as well as its potential inclusion in states’ renewable energy portfolios.
Still, contrary to the traditional antagonisms between large-scale hydro and other forms of renewable power, opportunities exist for wind and hydro to collaborate and mutually benefit.
All remote generation, including wind farms, faces the challenge of getting the energy to market, often requiring the construction of new transmission lines. An appropriately sited new line, however, could carry both hydro and wind, utilizing hydro’s base-load power to balance out wind’s intermittency.
Even so, if you’re Gov. LePage and, therefore, ideologically precluded from recognizing wind’s increasing cost competitiveness, environmental benefits and collaborative potential with large scale hydro, there remains an additional compelling reason to embrace the industry.
Simply put, wind remains a powerful engine for economic growth in Maine, especially as we continue to ascend from the depths of the national recession. For many industries, notably construction and engineering, wind has been a lifeline during a time when public sector spending declined dramatically and private capital largely sat on the sidelines.
The wind industry has invested more than $1 billion in Maine over the last 10 years, putting over 700 local Maine businesses to work across all 16 counties. That represents thousands of real jobs for local people.
What’s more, the industry is poised to invest almost 2 billion new dollars in Maine during the next three years, allowing local businesses to not only grow in-state, but also profitably export their services and expertise elsewhere. What other industry is doing that?
It’s also worth repeating that Maine ratepayers do not bear the cost of local wind development or its associated transmission. Instead, the energy is sold into New England’s regional grid and purchased by major utilities in Massachusetts and Connecticut, as well as businesses and institutions to our south hungry to displace their reliance on coal, oil and nuclear.
In other words, wind is one of Maine’s best value-added exports.
Rather than throw rhetorical barbs at this increasingly cost-competitive economic engine and risk driving investment capital elsewhere, the governor should swallow hard and acknowledge that wind has a real role to play in advancing his own energy agenda.
Michael Cuzzi is a former campaign aide to President Obama, Secretary of State John Kerry, and Rep. Tom Allen. He manages the Portland, Maine, office for VOX Global, a strategic communications and public affairs firm headquartered in Washington, DC. He can be reached at:email@example.com