- The New Hampshire House and Senate have passed a bill ordering the state Public Utilities Commission (PUC) to decide if it is in the best interest of Public Service of New Hampshire (PSNH) to divest its interests in coal-fired generation.
- PSNH is New Hampshire’s only generation-owning utility and doubts, because of gas price volatility, the contention that it would be more economic for ratepayers to purchase natural gas-generated electricity from New England power markets.
- PSNH argues that insufficient supply and pipelines make natural gas a high risk option but consumer advocate groups argue the cost of old inefficient coal plants is too high, especially now that new EPA regulations will require upgrades that could exceed $400 million per plant.
As PSNH’s coal-fired electricity prices rise, deregulated ratepayers move away from it, which reduces its customer base and results in higher prices that cause further customer migration. A PUC staff report determined market prices will continue to beat PSNH rates and divestiture of the coal plants would be a better choice for ratepayers. Stranded costs, the difference between the sale price of the coal plants and their value on PSNH’s books, would add an approximately $400 million cost for ratepayers.
The bill was not opposed by PSNH or consumer advocates because all agreed the PUC forum is the right place for the decision.
PSNH VP Bill Smagula: “We’re on the verge of a high-risk period. Nobody is building anything and we’re without really a solution in sight…[and] closing the plants, it just doesn’t add up to me.”
Consumer advocate Susan Chamberlin: “We have to ask, how much does an insurance policy have to cost to be of value…it’s not fair for consumers to have to pay for plants that are really old and rarely run…”