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Date: 5/30/2023
WESTHAMPTON — Spring Town Meeting this month voted in favor of aggregating electricity purchases for residents of the town, which may lower the rates for every kilowatt hour. The Selectboard signed a contract with aggregation consultants Colonial Power Group on May 22 and now wait for the program to power up.
It may be a very long wait.
According to Mark Cappadona, president of CPG, state level, federal and international factors are working to delay municipal aggregation programs and reduce the availability of power. That may make energy prices go up, but are guaranteed to delay Westhampton’s program.
“I’ve listened to the secretary of energy speak two or three times now,” Cappadona said of Rebecca Tepper, Gov. [Maura] Healey’s pick for the position. “Every time she’s been asked about municipal aggregation she’s made a note like, just give us a little bit of time to turn the ship around on these, administratively.”
Cappadona said the Department of Public Utilities takes a full 36 months to approve municipal aggregation contracts. He sees no reason for such a long delay. It doesn’t matter what size city or town submitted an application, the wait will be lengthy. He recalled the Speaker of the Massachusetts House of Representatives Ronald Mariano signed a letter to the DPU two years ago, asking officials to approve an application from the city of Quincy for its aggregation program.
“No matter who’s asking the department, it feels like they’re in an ivory tower,” Cappadona said. “This is the speaker of the house signing off on a letter asking for a quick turnaround and it’s crickets. Nothing happened.”
The long delay makes it impossible to predict what the price of energy will be when aggregation begins in town. Cappadona refuses to guess. He points to the impossibility of getting liquid natural gas supplies from shipping points in the southern United States to Everett, the liquid natural gas importing facility for New England. Energy prices are also complicated by the Russian invasion of Ukraine and the political consequences.
The Nord Stream 1 and 2 pipelines, laid in the ocean between Russia and Europe, last year were destroyed by unknown actors, crippling the delivery of Russian liquid natural gas to Europe. It may not matter. Cappadona doesn’t think those major players will do business again, whether the pipelines are repaired or not.
“Mr. [Vladimir] Putin comes to his senses and says, ‘I’m going to back out of this sovereign nation and we’re going to move forward again,’ I don’t see them doing business with Europe,” Cappadona said. That will keep liquid natural gas supplies tight in New England too. “Until we get the offshore wind we’re fighting for those liquid natural gas resources that the rest of Europe, as well as Japan and Thailand, all those other places … have always been in the liquid natural gas market for.”
The advisability of aggregating to reduce the price of energy was amply demonstrated last winter when Eversource’s basic rate hit 33.841 cents per kilowatt hour. The expensive rates were not due to a lack of liquid natural gas. Rather, the price rocketed higher, in part, because of the Jones Act, a federal law adopted after World War I.
The Merchant Marine Act of 1920, also known as the Jones Act after U.S. Sen. Wesley Jones, who proposed it, protects the shipping industry in the United States. The act requires that any goods or loads shipped between two U.S. ports must be transported on a ship built in the United States. A second requirement under the act is that crews of those vessels must be manned with a majority of U.S. citizens.
“How many [liquid natural gas] ships were built and manned in the U.S.? None. Zero,” Cappadona asked. “I thought this winter they would suspend the Jones Act for [liquid natural gas], but they never did … Tons of [liquid natural gas] out of Louisiana, but we can’t get it because of the Jones Act.”
The good news Cappadona offered residents is that while aggregation may not come soon the benefits will be flexibility among products, types of energy, and flexibility in makeup. CPG’s president commented that even if a town wanted 46% in green power, that program could be set up. That green power can come from solar arrays, old hydro-electric dams in Maine, or wind power from Oklahoma and Texas.
The power from distant sources will not come to Westhampton. Rather, CPG will arrange for the purchase of “RECs,” an acronym for renewable energy credits, directly from suppliers, who then distribute the monies back to the power sources preferred by residents.
He also offers a little hope that Tepper may expedite the processing of aggregation contracts.
“This new administration has some serious heavyweight people in the right places,” Cappadona said. “We just gotta give them some time to get their feet under them and start moving the ball on all of these issues that had fallen through the cracks.”