Healey study: No new pipelines needed

A STUDY COMMISSIONED BY ATTORNEY GENERAL MAURA HEALEY indicates new natural gas pipelines are not needed because the region’s power grid will face no “reliability deficiency” through 2030.

Even with more power plant retirements than expected, the study said the grid would face a power shortfall for only 26 hours over nine days during that 15-year period. The greatest shortfall, of more than 2,000 megawatts, would occur in the 2029-2030 winter season, the report said.

The report concluded that Massachusetts and New England don’t have to take any action to insure the reliability of the region’s power grid. The study said the combination of declining peak winter demand for electricity and the addition of power plants that can run on oil when natural gas is in short supply should be enough to forestall any shortages.

But the report nevertheless compared the status-quo to a series of options being considered by policymakers to address any potential shortfall that might occur if more power plants than expected shut down over the next 15 years. The report concluded the best approach, in terms of ratepayer cost and environmental impact, would be to invest in programs that entice homeowners and businesses to reduce their consumption of electricity and voluntarily curb power usage during high-demand periods. The report said $101 million spent on these programs would yield savings of $247 million and a reduction in greenhouse gas emissions of 1.86 million tons.

By contrast, expanding the region’s natural gas pipeline capacity to meet the potential power shortfall would cost $66 million and yield savings of $127 million, while increasing greenhouse gas emissions by 80,000 tons.

The report said the cost of energy efficiency measures plus the importation of hydro-electricity from Canada would cost $604 million and yield savings of just $502 million, but would reduce greenhouse gas emissions by 4.86 million tons. The report said the hydro option was the only approach that would allow the region to meet its 2030 climate goals.

“This study demonstrates that we do not need increased gas capacity to meet electric reliability needs, and that electric ratepayers shouldn’t foot the bill for additional pipelines,” said a statement released by Healey. “This study demonstrates that a much more cost-effective solution is to embrace energy efficiency and demand response programs that protect ratepayers and significantly reduce greenhouse gas emissions.”

With the release of the report, Healey is now squarely at odds with the Baker administration on energy policy. While Healey favors energy efficiency initiatives and programs that entice businesses and homeowners to reduce electricity consumption at times of peak demand, Gov. Charlie Baker  favors what he calls a “combo platter” approach on energy, which includes the promotion of energy efficiency efforts and renewables as well as new natural gas pipeline capacity and transmission lines bringing hydro-electricity from Canada.

The governor said he is not only interested in a reliable power grid but lower electricity prices. Massachusetts electricity prices are 30 percent above the national average and rank among the highest in the nation.

Baker’s Department of Public Utilities has already authorized local electric utilities to seek bids for natural gas pipeline capacity and he is pushing legislation that would allow local utilities to negotiate long-term contracts for hydro-electricity.

Baker’s thinking is more in line with the operator of the region’s power grid and local utilities, who favor expanding natural gas pipeline infrastructure. Eversource and National Grid issued statements on Wednesday broadly criticizing the report. National Grid said in its statement that “there’s no getting around the need for more pipelines to moderate exorbitant electricity prices – customers in New England have been subjected to more than $7 billion in electricity price increases over the last three winters.”

Kinder Morgan’s Tennessee Gas Pipeline Co., which is seeking to build a new pipeline into the region, issued a statement echoing the themes raised by local utilities while also pointing out that the status quo approach included in the report supported the continued use of oil to generate electricity during periods of high demand.

The report was prepared by Analysis Group Inc. of Boston and paid for by the Barr Foundation, which has made fighting climate change a focus of its philanthropy work. The lead author of the report, Paul Hibbard, could not be reached for comment.