FERC calls report on Eversource, Avangrid flawed
Agency says Environmental Defense Fund reached ‘incorrect conclusions’
THE FEDERAL ENERGY REGULATORY COMMISSION said on Tuesday that a report released by the Environmental Defense Fund accusing Eversource Energy and Avangrid Inc. of artificially driving up electricity prices in New England “was flawed and led to incorrect conclusions.”
The report, released in August 2017, said gas utilities owned by Eversource and Avangrid routinely placed large orders for natural gas on the Algonquin Pipeline that runs from New Jersey to Massachusetts and then sharply reduced those orders at the last minute.
“This behavior blocks other firms from utilizing pipeline capacity, which artificially limits gas supply to the region and drives up gas and electricity prices,” the report said. “We estimate that capacity withholding increased average gas and electricity prices by 38 percent and 20 percent, respectively, over the three-year period we study. As a result, customers paid $3.6 billion more for electricity.” The three-year period ran from August 1, 2013, to July 31, 2016.
FERC said its staff conducted a review of the allegations contained in the report using both public and non-public data and found no evidence of anticompetitive withholding of natural gas pipeline capacity.
Eversource released a study of its own on Tuesday that indicated the report released by the Environmental Defense Fund included a number of false claims. The report, written by Levitan & Associates, said Eversource was following standard industry practice in placing orders for natural gas, that it did not benefit or profit from the actions it allegedly took, and that the capacity quantities it put on hold were an “infinitesimal portion of average demand.”