Should Canadian Hydro-Power Count Towards N.H. Renewable Energy Goals?

Jan 28, 2015

Credit Mac Armstrong / Flicker CC

State lawmakers are being asked to decide if hydro-power from Canada should be eligible for renewable energy subsidies.

The proposal was one of two presented by Republican David Murotake of Nashua that would make modifications to the state’s Renewable Portfolio Standard (RPS).

He says lumping hydro in as renewable energy would drive down the cost of meeting the state’s renewable energy goals.

“This bill is all about the rate-payer,” he explained, saying his goal was to reduce the cost of the renewable energy credits utilities must buy under the RPS to close to zero.

The bill  is "not about Northern Pass," says Murotake, "it is enabling legislation for hydro-electric power to compete in open-market fashion" as renewable energy under the state's law.

The RPS requires electric utilities in the state to buy credits to offset a certain percentage of their power – which increases every year until 2025 – or pay an alternate fee. Revenues from the fees are then re-invested in state-issued grants and rebates for new renewable energy projects.

The program has resulted in nearly $15 million in spending for renewable energy in the state, but the fund has also been targeted by state budget writers. In the last budget, more than $16 million was taken and used for other government expenses.

The Public Utilities Commission estimates that in 2014 the program costs the average rate-payer (650 kilowatt hours a month) a little more than $24 dollars a year, or $1.95 per month.

Critics of the bill – like Democratic Senator Martha Fuller Clark, who was involved in designing the RPS – argue that hydro-power from Quebec doesn’t need support to be competitive with fossil fuels, and would gobble up subsidies that now go to renewable energy stateside.

“If we make it more difficult for renewable energy to continue to be developed in this state, it will have a negative impact on the cost of energy,” she said, arguing that the state needed to diversify its energy supply.

Compliance with the RPS accounts for 1.5 to 2 percent of consumer’s energy bills, and the bill’s opponents say that cost is not a primary driver of the region’s high electric costs.

Murotake’s second bill would return half of the payments made by utilities as rebates to customers, and eliminate the various classes of renewable energy that exist under the RPS. The classes each represent a technology that original creators of the program were trying to encourage by carving out a percentage from that technology that utilities needed to buy. They include solar, and already-existing biomass and hydropower.

This was just the first hearing for these proposals: to become law it still needs a vote from the House, Senate and a signature from the governor.