New natural gas supply and delivery capability, including import capacity for liquefied natural gas (LNG), along with new investment in renewables and power-related infrastructure, are needed for reliability in New England and to improve competitive markets in the region, a new report released Wednesday concludes.
Meanwhile, the results of a poll released Wednesday indicates New England voters consider energy supply and prices as one of the top three most important issues facing the region and strongly support significant improvements to the region’s energy infrastructure.
The report and the poll results were released by the recently formed New England Energy Alliance (NEEA), a coalition of energy providers, business and trade organizations, labor and others concerned about potential energy shortages and the impact on the region’s economy.
Concluding that there is no “silver bullet” to solve the region’s energy challenge, the report makes the following findings and recommendations:
The report was prepared for the Alliance by Analysis Group Inc. of Boston under the direction of Dr. Susan F. Tierney, former Assistant Secretary of Policy at the U.S. Department of Energy and member of the National Commission on Energy Policy.
“Our assessment of the region’s resources indicates that we are at a critical point today,” said Tierney. “Energy shortages could be acute soon — by 2010 at the latest. Since most of the region’s energy investments are made in private markets which take time for project development, it means that policymakers need to act aggressively now to avoid problems in the future.”
In conjunction with releasing the report, the NEEA released public opinion research results indicating New England’s voters view energy supply and prices among the top three most important issues facing the region. And by a two-to-one margin they favor new energy infrastructure — specifically, 79% favor more transmission lines; 75% favor more natural gas plants and 72% favor an off-shore wind farm.
“The region’s citizens recognize that energy infrastructure is a problem, they support development of more energy facilities and they want their policymakers to work with energy providers to address the issues getting in the way of needed development,” noted Ernest Paicopolos, principal of Opinion Dynamics Corp., which conducted the poll for the NEEA.
The report, “New England Energy Infrastructure — Adequacy Assessment and Policy Review,” notes that New England’s energy costs are comparatively high. Of the eight states with the highest consumer energy prices in the nation, five are in New England. The report stresses that enhanced energy infrastructure and energy planning in New England may bring New England’s energy prices to more competitive levels with the rest of the nation.
The report calls on policymakers to resolve several factors that are causing uncertainty for energy companies and energy investors in New England — regional carbon policy, federal and state rules governing the region’s electric resource adequacy regime and community acceptance of infrastructure projects. Tierney noted that “the sooner these sources of risk and uncertainty are resolved, the sooner those investors will invest in infrastructure in the region.”
The NEEA will provide briefings to key policy and decision makers in the region on the findings of the report and the results of the survey. Next year, it is planning a high profile agenda including surveying the region’s largest energy users and largest employers, publishing a series of reports on various issues affecting the energy industry in the region, as well as conducting programs to gather expert opinions on solutions to be presented to government and industry leaders.
Both the report and the public opinion survey are available on the alliance’s web site: www.newenglandenergyalliance.org.
Corporate members of NEEA include diversified companies with large electric power generating assets in the region (Entergy and Dominion Resources); electric transmission and delivery companies (National Grid, Northeast Utilities and Green Mountain Power); a diversified natural gas delivery and power generation company (KeySpan Energy); a company with pipeline, LNG and generation assets (TransCanada); a natural gas pipeline company (Iroquois Gas Transmission System); an LNG developer (Weaver’s Cove); and an energy marketer (Constellation NewEnergy). NEEA’s members also include the Edison Electric Institute and the Nuclear Energy Institute.
Advisory council members include organizations representing businesses and consumers in the region: the Associated Industries of Massachusetts, the Massachusetts Business Roundtable, the Greater Providence Chamber of Commerce, the Business and Industry Association of New Hampshire and the Vermont Chamber of Commerce, as well as the Utility Workers United of America and individuals with broad experience addressing energy and environmental issues.
Maine Gov. John Baldacci recently proposed a regional natural gas conservation effort with a goal of cutting gas consumption by 5% by 2011 (see Daily GPI, Oct. 18). Baldacci sent a letter to the governors of Connecticut, Massachusetts, New Hampshire, Rhode Island and Vermont proposing a joint conservation initiative with a targeted 1% reduction per year in gas consumption in each of the states. Baldacci said the initiative was in response to the impact of Hurricanes Katrina and Rita on gas supply, sharply higher gas prices and the potential for shortages in the region this winter.
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