An Unnecessary Risk for NH Jobs and State’s Economy
For Immediate Release:
CONCORD, N.H., February 2, 2012—The forced sale of Public Service of New Hampshire generation facilities is not in the best interest of PSNH customers, nor the New Hampshire economy, and would threaten hundreds of jobs in the state. That was the main message today when PSNH testified in opposition to House Bill 1238, which calls for the divestiture of the company’s generation facilities by the end of next year.
“Our customers today have the best of both worlds because they can buy from the market when it is cheaper than PSNH energy, and they can buy from PSNH when the market is more expensive,” testified Terry Large, PSNH Director – Business Planning and Customer Support Services. “To be clear: New Hampshire completed electric utility deregulation. The state chose to do it differently than some other states, and PSNH customers have been the been the beneficiaries.”
The State restructured its electric utility industry in 2002, providing all New Hampshire customers with the opportunity to purchase energy from an independent supplier. Under the New Hampshire model, PSNH still owns its traditional fleet of nine hydroelectric and three fossil-fueled power plants, and uses the energy they produce to serve customers who have not switched to an independent supplier.
“PSNH customers have saved more than $700 million over the last decade because our energy was priced below the market price for most of that time,” said Large. “A question for the Legislature is: ‘is it in the best interest of consumers to eliminate their ability to choose, and instead rely solely on a market that is driven mainly by a single fuel, natural gas, which historically has experienced significant price volatility?’”
In his testimony to the House Science, Technology and Energy Committee, Large also testified that a forced sale will likely create “stranded costs” that will be recovered from all PSNH customers. Simply put, a stranded cost would be the difference between the sale price and value of the plants that PSNH is eligible to recover. Large noted that the energy market is currently depressed due to the economic recession and abnormally low natural gas prices; factors that may depress the sale price of the power plants in the near term.
A forced sale at this time could result in significant stranded costs, and the loss of jobs and local taxes if the plants were shutdown. “In fact,” said Large, “in one recent sale of a power plant, the purchaser of the AES Thames plant in Connecticut was not a power generator who intended to operate the plant in the future. It was a scrap dealer.”
PSNH Power Plants – Key Facts
- Number of employees: 320
- Number of facilities: 12 Primary - Three fossil/biomass: Coal, Coal and Biomass, Gas and Oil; and nine hydroelectric facilities. Plus five Internal Combustion Units (jet and diesel fueled; used during peak demand periods).
- Property Taxes Paid: >$9 million/year
- Total Capacity: 1,165 megawatts
- Percentage of total New England Capacity: 3.4 percent
- Percentage of total New Hampshire Capacity: 27 percent
|MEDIA CONTACT:||Martin Murray||Senior Corporate News Representative|
PSNH is New Hampshire's largest electric utility, generating and distributing clean electricity for more than 500,000 homes and businesses in an environmentally friendly manner.