AUGUSTA – Members of the New England Power Pool Friday rejected a compromise
energy charge designed to forestall big increases in electric bills for
residential, commercial and industrial consumers.
Proponents of the compromise proposal had 65.8 percent of the votes of the
132 voting members of NEPOOL, but a 68 percent majority is required by NEPOOL
bylaws. The bloc of power generators that collects the surcharge, called ICAP
(Installed Capacity), opposed the consumer-generated compromise.
Anthony Buxton, an energy attorney at Preti, Flaherty, Beliveau, Pachios
& Haley, LLC, the firm representing a coalition of electricity consumers in
Maine, said Friday he was "disappointed, but not surprised" by the outcome. He
said he would continue the fight to reduce a steep ICAP charge approved by the
Federal Energy regulatory Commission, in spite of Friday's rejection of a lower
ICAP charge.
"We will never, never, never, never quit on ICAP," Buxton
said.
FERC late last year raised the ICAP from 17 cents per kilowatt per month to
$8.75 per kilowatt per month, which would add about $15 to the average
residential electric bill if the $8.75 became the standard. That would cost
businesses and manufacturers hundreds of thousands of dollars a year and could
threaten many financially, and discourage others from moving to Maine, according
to opponents of the $8.75 surcharge. Gov. Angus King called the $8.75 ICAP
surcharge "grossly excessive" and a threat to the already beleaguered Maine
economy. The new ICAP figure is temporarily on hold pending appeals and
challenges by consumer interests.
The vote Friday was one of several possible ways to try to keep the ICAP
charge to an affordable level. ICAP charges are paid to power generators by
electricity suppliers and distributors and are customarily passed along to
ratepayers. It was initially designed as incentive for power generators to both
remain in business and be available to generate electricity to meet unexpected
spikes in power demands.
Donald Sipe, the energy attorney at Preti, Flaherty
who represents consumers lobbying for a smaller ICAP, said an ICAP charge of
anything more than the previous 17 cents is unnecessary. Sipe said the $8.75
ICAP would cost Maine consumers collectively $100 million a year, and New
England consumers, $2 billion annually.
The Maine Senate and House of Representatives, the state's Congressional
delegation and a consortium of businesses, in addition to Public Advocate Steve
Ward, the Maine Public Utilities Commission and Gov. Angus King all came out
publicly against the higher ICAP charge.
Consumer groups asked NEPOOL, which
governs wholesale electric markets, to recommend to FERC a lesser ICAP rate of
$3 per kilowatt per month.
Buxton said power generators including Duke Energy, Enron, Florida Power
& Light, Northeast Utilities, Sithe, Mirant and PG&E did a disservice to
Maine consumers and called upon the companies to justify their votes on
Friday.
He said that on Wednesday, June 6, another group has a chance to
recommend to FERC a lower ICAP charge. Independent System Operators of New
England (ISO-New England) also could recommend the FERC adopt a small ICAP. FERC
can accept or reject alternative ICAP rates.
The new charges could begin
taking effect, should FERC not change its mind, anywhere from several months to
a year.
Preti Flaherty has offices in Portland, Bath and Augusta, Maine, Concord, NH and Boston, MA. With more than 80 attorneys, the firm counsels clients in the areas of business law, energy, environmental, estate planning, health care, intellectual property, labor and employment, legislative and regulatory, litigation, technology and telecommunications.
