Fight between rival energy companies threatens to delay CMP’s $1 billion energy corridor
CMP parent Avangrid is locked in a bitter dispute with rival NextEra over the upgrading of equipment at the Seabrook nuclear station, without which the 145-mile corridor can’t connect to the New England grid.
By Colin Woodard Staff Writer
A heated dispute between Central Maine Power’s parent company and rival energy giant NextEra is threatening to delay the completion of CMP’s controversial 145-mile transmission corridor.
CMP’s parent – Avangrid, which is itself the subsidiary of Spanish energy giant Iberdrola – has been locked in a bitter disagreement with Florida-based NextEra Energy, which it accuses of intentionally obstructing the transmission project by failing to perform a necessary safety upgrade of a piece of equipment at the nuclear power plant in Seabrook, New Hampshire. Until NextEra upgrades this circuit breaker in Seabrook, CMP can’t connect its $1 billion New England Clean Energy Connect line and the 1,200 megawatts of Quebec hydropower it would carry to New England’s primary electricity grid.
“NextEra’s actions and inactions reflect NextEra’s intentional efforts to interfere with the interconnection of the NECEC Project,” Avangrid said in a complaint filed with federal authorities Oct. 13, in which it says continued delays might jeopardize the project’s May 31, 2023, go-live date.
“NextEra has taken every opportunity, both in the open and behind the scenes, to oppose, delay and derail the NECEC Project, all to benefit its existing fossil and nuclear generation located in Maine and New Hampshire and its renewable projects in Maine,” the filing before the Federal Energy Regulatory Commission states. “In doing so, NextEra is purposely trying to thwart the goals of Maine and Massachusetts to obtain more renewable power, which will have a negative impact to the climate and to the people of the region.”
NextEra, which owns the 822-megawatt W.F. Wyman oil-fired power station on Cousin’s Island in Yarmouth, has dismissed Avangrid’s complaints as a baseless effort to “cast aspersions and false allegations against Seabrook and its affiliates in an effort to color the outcome of the contractual dispute.”
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Comment
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Comment by Willem Post on July 24, 2021 at 1:20pm
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Dan,
ISO-NE is lucky, because other grid operators have already done such analyses, because they have much greater percentages of unreliable, weather-dependent, wind and solar-dependent, season-dependent RE sources on THEIR grids
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Comment by Dan McKay on July 24, 2021 at 8:58am
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ISO-NE Analysis :
"ISO New England and regional stakeholders have been collaborating to assess and explore potential market and reliability issues that may arise in the coming years as the electric industry experiences significant change driven by rapid innovation and state energy and environmental policies to incentivize economy-wide decarbonization. The most recent regional effort, known as the New England Future Grid Initiative, consists of two primary tracks: the Future Grid Reliability Study (“Reliability Study”) and the Pathways to the Future Grid Analysis (“Pathways Analysis”)."
Every scenario includes 1200 MW NECEC project
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Mass must have this power line to connect to the hydro plants in Canada to counteract the variations of wind output.
The gas plants, which currently balance any wind output, may be mothballed, if gas flow is politically restricted
Wind and solar are very expensive if all costs are considered
Cost Shifting from Owners to Ratepayers and Taxpayers
The owning and operating cost of wind, solar and battery systems, c/kWh, is reduced by about 45%, due to subsidies. However, because no cost ever disappears, per Economics 101, the subsidy costs are “socialized”, i.e., added, in one way or another, onto:
1) The rate bases of utilities, i.e., paid by ratepayers
2) Taxpayers, by means of extra taxes, fees and surcharges on electric bills and fuel bills
3) Government budgets
4) Government debt
5) Prices of goods and services other than electricity
If the subsidies had to be paid by owners of wind and solar systems, the contract prices paid to owners would need to be:
- At least 19.3 c/kWh, instead of 11 c/kWh, for large-scale solar- At least 15.5 c/kWh, instead of 9 c/kWh, for ridge line wind. See table 1 and URL
http://www.windtaskforce.org/profiles/blogs/cost-shifting-is-the-na...
Shifting Grid Costs
Many small-scale solar systems and/or a few large-scale solar systems on a distribution grid would excessively disturb the grid, especially at midday. Battery systems, with sufficient capacity could counteract the output variations of those solar systems.
Wind and solar systems could not be connected to the grid without the services of the CCGT plants, i.e., shutting down CCGT plants, and artificially diminishing/obstructing their domestically produced gas supply, advocated by pro RE folks, would not be an economic option for decades, if ever, because of the high costs of battery systems.
1) The cost of extension/augmentation of electric grids to connect widely distributed wind and solar systems (not paid by wind and solar system owners)
2) The cost of services rendered by other generators, mostly CCGT plants, which counteract the ups and downs of weather/season-dependent, variable, intermittent wind and solar outputs, 24/7/365 (not paid by wind and solar system owners).
3) The cost of battery systems to stabilize distribution grids, due to variations of the solar and wind system outputs (not paid by wind and solar system owners).
Shifting Owning and Operating Costs
The combined effect of cost shifting, determined behind closed doors, increases a project’s annual cash flow, i.e., “left-over-money”, to provide an ample profit for the RE system owner.
RE system owners are happy, having the “ears” of friendly politicians, saving the world from climate change, and claiming: “See, my project is profitable and competitive”, while everyone else gets hosed.
1) Grants from various sources, such as the VT Clean Energy Development Fund
2) 26% federal investment tax credits, plus state FITs. Tax credits reduce, dollar-for-dollar, the taxes GMP pays on profits
3) 100% depreciation over 5 years; the normal for utilities is 20 to 25 years. Write-offs reduce GMP taxable income
4) Deductions of interest on borrowed money. Interest deductions reduce GMP taxable income.
5) Various O&M payments are waved, such as sales tax, fees, property tax, school tax, municipal tax, etc.
6) RE system owners sell their output at two to four times NE wholesale market rates, which have averaged about 5 c/kWh starting in 2009, courtesy of:
- Low-cost, low-CO2, very-low-particulate, gas-fired CCGT plants
- Highly reliable, very-low-CO2, zero-particulate, nuclear plants
- Low-cost, very-low-CO2, zero-particulate, hydro plants Canada.
All-in Cost of Wind and Solar
Pro RE folks always point to the “price paid to owner” as the cost of wind and solar, purposely ignoring the other cost categories. The all-in cost of wind and solar, c/kWh, includes:
1) Above-market-price paid to owners
2) Subsidies paid to owners
3) Owner return on invested capital
4) Grid extension/augmentation (not paid by owners)
5) Grid support services (not paid by owners)
6) Future battery systems (not paid by owners)
Comments on table 1
- The owners of legacy systems were paid much higher prices, than owners of newer systems.
- Vermont legacy “Standard Offer” solar systems had greater subsidies, up to 30 c/kWh paid to owner, than newer systems, about 11 c/kWh
- Wind prices paid to owner did not have such drastic reductions as solar prices.
- Vermont utilities are paid about 3.5 c/kWh for various costs they incur regarding net-metered solar systems
- "Added to the rate base" is the cost wind and solar are added to the utility rate base, which is used to set electric rates.
- “Traditional cost”, including subsidies to owner and grid support, is the cost at which traditional is added to the utility rate base
- “Grid support costs” would increase with increased use of battery systems to counteract the variability and intermittency of increased build-outs of wind and solar systems.
NOTES:
1) The prices should be compared with the NE wholesale grid price, which has averaged about 4.2 c/kWh, starting in 2009, due to low-cost CCGT and nuclear plants, which provided at least 65% of all electricity loaded onto the NE grid in 2019.
- Wind, solar, landfill gas, and methane power plants provided about 4.8%, after 20 years of subsidies
- Pre-existing refuse and wood power plants provided about 4.6%
- Pre-existing hydro power plants provided about 7.4%
- The rest was mostly hydro imports from the very-low-CO2 Canada grid, and from the much-higher-CO2 New York State grid
https://www.iso-ne.com/about/key-stats/resource-mix/
https://nepool.com/uploads/NPC_20200305_Composite4.pdf
2) There are O&M costs of the NE grid, in addition to wholesale prices.ISO-NE pro-rates these costs to utilities, at about 1.6 c/kWh. Charges for:
Regional network services, RNS, are based on the peak demand occurring during a monthForward capacity market, FCM, are based on the peak demand occurring during a year.
3) Each local utility has its own O&M grid costs, in addition to item 2, some of which are detailed on electric bills.
4) Vermont utilities buy electricity from various sources; average cost about 6 c/kWh, plus ISO-NE charges of about 1.6 c/kWh, for a total of 7.6 c/kWh.
Table 1/Vermont & NE sources
Paid to
Subsidies
Grid support*
GMP
Added to
Total
Traditional
Times
owner
to owner
cost
adder
rate base
cost
cost
c/kWh
c/kWh
c/kWh
c/kWh
c/kWh
c/kWh
c/kWh
Solar, residential rooftop, net-metered, new
17.4
5.2
2.1
3.5
20.9
28.2
7.60
3.7
Solar, residential rooftop, net-metered, legacy
18.2
5.4
2.1
3.5
21.7
29.2
7.60
3.8
Solar, com’l/ind’l, standard offer, combo
11.0
6.74
2.1
11.0
19.84
7.60
2.6
Solar, com’l/ind’l, standard offer, legacy
21.7
10.5
2.1
21.7
34.3
7.60
4.5
Wind, ridge line, new
9.0
4.1
2.4
9.0
15.5
7.60
2.0
Wind, offshore, new
12.1
5.4
2.8
12.1
20.3
7.60
2.7
* Excludes future battery costs
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Central Maine Power should stop yammering, and offer to make the grid adjustments at no cost to Seabrook, plus pay a bonus of 30% of turnkey capital cost, as an inducement
Remember, money talks
Maine as Third World Country:
CMP Transmission Rate Skyrockets 19.6% Due to Wind Power
Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.
Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT
******** IF LINKS BELOW DON'T WORK, GOOGLE THEM*********
(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 https://www.pinetreewatchdog.org/wind-power-bandwagon-hits-bumps-in-the-road-3/From Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" https://www.pinetreewatchdog.org/wind-swept-task-force-set-the-rules/From Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.” https://www.pinetreewatchdog.org/flaws-in-bill-like-skating-with-dull-skates/
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Hannah Pingree on the Maine expedited wind law
Hannah Pingree - Director of Maine's Office of Innovation and the Future
"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."
https://pinetreewatch.org/wind-power-bandwagon-hits-bumps-in-the-road-3/
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