The question is: is it legal to make electric utilities’ customers pay for new gas pipelines, even though we don’t need them?
The state Department of Public Utilities just said: YES.
In May the DPU started looking investigating whether it had the legal authority to let electric utilities own gas pipelines. There’s good reason to think the DPU doesn’t. Deregulation, enacted in the late 1990s, was supposed to separate distribution companies (like the utilities) from the companies that actually generate electricity. A free market in electricity, said deregulation fans, would bring down cut Massachusetts’s very high electric rates.
Now the DPU is saying: to hell with free markets. It’s fine for companies that distribute electricity to own the fuel sources too. Or, in legalese, “the Department has authority pursuant to G.L. c. 164, § 94A to review and approve contracts for natural gas pipeline capacity filed by electric companies.”
That’s good news for National Grid, which recently took a 20% share in the Access Northeast pipeline. This is one of several proposed pipelines that together would deliver far more fracked gas than the state needs, even according to the industry’s inflated estimates.
Governor Baker is behind all this. His Department of Energy Resources asked the DPU to rule on its legality, and the Baker-dominated DPU obliged.
But nobody expects Baker to stop here. The next step – eagerly expected by the energy industry – is to shift the cost and risk of the new pipelines onto us, the ratepayers. The industry doesn’t want to carry the cost, or the risk. They know the demand isn’t there.
Let the little people pay! It’s welfare capitalism at its worst. And it’s coming from a governor who is supposed to believe in free markets.
For more details see The gas tariff: research and talking points by Emily Kirkland of the Better Future Project.