Alternatives for energy price stability


It seems to me that we are in a crunch with regard to energy sources in Massachusetts. We have gone full tilt for natural gas usage without increasing our capacity much to supply it. We are also undermining the zero emission sources of energy development because gas has become so cheap compared to other sources because of the Regulations and Policies the state has pursued which do not take into account the long term costs of capital investment.

It seems to me that we need to diversify. We also need to impose costs on electric generators and gas users for Network upgrades so the truer cost of the shift is reflected in the cost of this energy source. There also should be considered a new hookup fee to fund capacity increases as more people, and businesses shift their energy source, impose switching cost on new users.

Finally, I think it is perverse that most green energy programs use the cost of standard generation methods as a starting point for setting their prices, standard electric cost + 2.5 – 5.0 cent per Kwh. While I do not think that this is entirely wrong, It seems to me that if Green energy is going to become a serious force in our regulated marketplace for energy, some of the set rate for generating green power should be based on cost of production, and not only a boutique addition for those of us who want to use green power. So if conventional power costs spike, as they are going to, these alternative power supplies become better options. They should not just track the increase in conventional power cost by regulation as they currently do. The state should create a way to fund these local energy projects that are, local job creating, zero emission, and use a local and free source of energy wind or solar. Keeping money locally or regionally is better economic policy than sending it to Texas, or Saudi Arabia for Massachusetts. Look at what the German government is doing with wind & solar power policy for example to create a system that is green and keep money local while allowing a robust economy.

Lastly I have heard about new pipelines costing billions of dollars to New England which we will end up paying for, because if built we will have to pay for the pipes by regulation. I have not heard about actually fixing the leaks both for green house gas emission reasons or using existing supplies effectively in a systematic way in our old distribution systems nor have I heard about any attempts to build large capacity storage locally to provide a local buffer storage. Having a new Large capacity storage for LNG on an island in the Boston harbor would go a long way to reducing the need for even more expensive gas pipelines I think.

One reply on “Alternatives for energy price stability”

  1. Dan, thank you for weighing on this. I think these are going to be big issues in the next legislative session. The coming power and gas shortages seem real. I’m working to understand what the legislature’s choices are on this — many of the key choices are federal. This will be an area I give considerable attention to over the months to come.

Comments are closed.