Having read Ken Wells’ Concord report, I felt some clarification was needed in his statements that Governor Sununu had killed biomass energy generation in the state.
It wasn’t clear to me how Governor Sununu could do this. Obviously a piece of legislation had been vetoed, but what exactly was this legislation? Ken didn’t make that clear. Nor did he mention that the Legislature had overridden Sununu’s veto on September 13 so the bill will be in force.
The legislation was a piece of “rent-seeking” by the biomass industry, by the state requiring our electrical utilities to buy a certain amount of power from these plants. Why would such legislation be necessary? It would be because biomass generated power (similar to many other “green” sources of power) is more expensive to create than other sources. Without a governmental mandate, our electrical utilities would try to keep their costs down by buying the least expensive power they could find. If biomass were economically competitive with other sources, no legislation would be needed.
Our legislators like to promise during their campaigns that they will work to lower our utility bills, but when they get in office, they do the exact opposite by rewarding favored industries with government-mandated subsidies that cost every ratepayer more.
New Hampshire has the seventh highest electrical rates in the country, at 19.47 cents per kilowatt hour, just less than California’s at 19.86, and Massachusetts at 21.54. Contrast that to the national average of 13.30 cents per kilowatt hour. Our power is more expensive than either Maine or Vermont, though they too pay well over the national average.
There are two obvious routes for our utilities to deal with this increased cost: 1) raise their rates, or 2) cut costs in other areas of operation, such as maintaining the infrastructure of power lines and transformers. I suspect that they will do both. How much it will add to our monthly bill will soon become apparent. We may soon have the third or fourth highest rate in the nation (We are unlikely to ever be as high as Hawaii at over 31 cents per kilowatt hour.).
This is a subsidy that the government is now requiring every electrical ratepayer in the state to pay to keep these non-competitive businesses in operation. While the loss of jobs in this industry is unfortunate, requiring all of us to subsidize them when they can’t successfully compete in the market burdens us all.