To The Daily Sun,
As I sit in my relatively warm kitchen on this bitterly cold day — zero degrees — I am reminded just how vulnerable we are to the elements. Nearly all of us have heating furnaces which depend on electricity to start them. What if we were to start experiencing long periods of power outages because the power grid simply didn't have enough electricity for everyone?
The N.H. Public Utilities Commission (PUC) is now required, by misguided legislation passed by the previous legislature, to force Public Service Company of N.H. to sell off 12 of its currently functioning power plants on New Hampshire soil and rivers (nine being hydro plants), and they are proceeding ahead to do so. (Reference: Laconia Daily Sun Associated Press (AP) article January 17, 2015, page 15)
PUC's most recent report (reference article) said: PSNH's 12 power plants have a total value of $660 million but would probably bring about $225 million on the open market, leaving $435 million in costs to be paid by consumers." If no sale of these 12 plants were to occur, consumers would not be on the hook for a $435 million loss, but if there is a sale, consumers will be paying off that $435 million, A.S.A.P., however it is that the PUC structures it. (Keep in mind the purported reason for the sale was to save consumers from future price rises.)
It cost PSNH $422 million in 2011 to buy one scrubber system on one plant in Merrimack (demanded by the current federal administration to ensure even cleaner air coming out after the power generation process. PSNH did it because it really believed we needed that plant and didn't want to shut it down, and felt they could pay it off affordably, over time) So, when the PUC determines the total current sales value of all 12 plants combined is $660 million, that is not the replacement value, which would obviously have to be much higher. If, for example, we discovered, after the sell-off, just what a giant mistake it had been and were to price out the replacement cost, that would, doubtless be in the billions, maybe $3 billion, $5 billion, $7 billion. Maybe even higher.
This makes the 12 plants shockingly undervalued on the marketplace and subject to scavenger companies coming in, bidding and winning their bids, then proceeding to disassemble the plants and sell them off, either piecemeal or in their entirety. Off the pieces go, by train or ocean barge, to new locations. China, for example, being cash rich and infrastructure poor, would certainly welcome buying top line electrical plants for pennies on the dollar, and the scavenging company would still make a handsome profit. Remember, these are fully updated, proven, functioning plants. Bye, bye, plants.
There would be a lot more immediate, safe money to be made by such scavenging than by a company who wanted to actually come in and run it. Why? Because the three fossil fuel plants are currently a political target, as the federal administration is targeting such plants as it tries to change over our power sources to new technologies. (Remember power research company Solyndra — $500 million total loss plus several other research companies, same. Bringing on new technology-driven sources of power is a very slow and risky process, as we've already seen.) What private company would consider trying to come in and actually continue to run the power plants, when they know the current political policy is to shut them down, by piling on so many outrageously costly regulations that the utilities cannot keep them afloat? (Right now, across the nation, fossil fuel plants have been and are being shut down permanently due to federal regulation, alone.)
That's the reason the sales value is so low.
Maybe some day geothermal and ocean current technologies will be able to provide power solutions, but that's a big, far off maybe. We are now seeing the side effects of the windmill installations that are being added along the ridge-tops of our state. The people who now have to live with them and the detrimental environmental effects they are now causing are not happy and are fighting any new ones coming in to the best of their ability. Would you be happy to see windmills along all our ridge-lines? And think how costly it will be to replace our power infrastructure that was paid for in "yesterday's" dollars with new and risky technology in "today's" dollars. Those recently installed windmills, owned by the Spanish company, for example, are subsidized by our federal government, because the cost is so high. Without the subsidies, they would not have been built. They aren't cost-effective on their own.
Word is, that the proposed Northern Pass energy project, that will mar our landscapes with its really big wires as it passes through New Hampshire, would require a tremendous water-damming project that will have catastrophic effects for vast areas of Canada. Might the Canadian government decide to pull the plug on that?
This power plant sell-off is an issue that needs to be addressed in the here and now.
Please contact your representatives and senators. Only they can stop this with a bill to repeal that previous legislation by the previous legislature. That's all it takes. Just knowledge and will. They could pass that repeal in one day, if they had a mind to. Right now, no one down there in Concord is pushing to stop it. We have to make them think about it.
Next time, in Part 4, how this sell-off can affect our future. Watch for it.