Bill seeks to boost local electricity in New Hampshire through natural gas, nuclear

A bill that would allow electric utilities to own a certain quota of fossil fuel and nuclear generation was endorsed Tuesday by a second House committee.

The proposal would enable utilities to own natural gas and nuclear generation for the first time since a turn-of-the-century shakeup in utility regulation removed power generation from their domain. As proposed, it also includes the repeal of certain emissions and efficiency requirements for those prospective utility-funded fossil fuel generators.

The House Finance Committee recommended an amended version of House Bill 1775 on Tuesday. 

From sponsor and South Hampton Republican JD Bernardy, the bill would allow utilities to invest in or own natural gas or nuclear generation infrastructure. It includes a limit on individual units of 5 megawatts, smaller than proposed designs for future nuclear reactors, and also includes a limit on the total proportion of energy a utility could generate with its own equipment. Considering the amount of power a company distributes at peak times, the amount they could generate with utility-owned equipment would be capped at 10% of that total, according to the bill.

At a hearing in February, Bernardy said he hoped the law would encourage more gas and nuclear power plants to be built in New Hampshire to boost the state’s energy supply in the future. The bill, he said, was a “piggyback” on preexisting rules that allow New Hampshire utilities to own renewable generation, like solar arrays, up to 5 megawatts in size. 

New Hampshire already generates more electricity than is consumed within the state. But Rep. Douglas Thomas, a Londonderry Republican and vice chair of the House Committee on Science, Technology, and Energy, said increasing the amount of electricity generated in New Hampshire could support development of high-energy-use projects, such as data centers.

However, other committee members debated whether the bill would give utilities too much control over the power market.

The separation of power generation and distribution in New Hampshire traces to the state’s utility “restructuring,” which began in 1996. Proponents of restructuring argued that giving consumers choice over their power sources would increase competition, lowering rates. 

Rep. Tony Caplan, a Henniker Democrat, said the proposal risked compromising that goal,  “distorting” the power market by giving utilities more control.

“I think that would, in effect, crowd out other competition,” he said. 

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Similarly, Rep. Kat McGhee, a Hollis Democrat, said the statute that the bill proposes amending was designed to increase competition and diversification of the state’s power market by incentivizing renewable generation. Expanding that incentive to also apply to natural gas and nuclear generation, she said, would negate that intent.

During an executive session on the bill in the House Finance Committee Tuesday, committee member Rep. Chris Muns, a Hampton Democrat, echoed McGhee’s concerns.

The proposal compromises the underlying statute’s goal of encouraging energy diversification, he said, and “picks winners and losers” by tipping the scales in favor of natural gas and nuclear generation.

Bernardy said the proposed 10% cap would prevent utility monopolies.

Building new generation would still incur costs for ratepayers, Muns said — particularly from new nuclear, which Muns said had an “extremely high price tag per megawatt.”

Rep. Timothy Harrington said in February the construction of the Vogtle nuclear power plant, in Georgia, had raised rates for utility customers after large cost overruns. But Bernardy said that was a unique case, and he believed nuclear power — particularly small modular reactors — would become more cost-effective.

Muns also expressed concern about other provisions in the bill, including the proposed repeal of a section of New Hampshire law that requires fossil-fuel-fired generation equipment funded by a public utility to meet certain efficiency and emissions standards. 

It’s not yet clear whether utilities would take advantage of the policy if it were to become law.

Eversource does not own any distributed generation in New Hampshire and currently has no plans to change that if HB 1775 passes, said spokesperson William Hinkle. The only solar array owned and operated by a New Hampshire regulated utility belongs to Unitil; Director of External Affairs Alec O’Meara said in February the company was neutral on HB 1775, but was not currently considering an investment in either gas or nuclear. Neither company was involved in authoring the legislation, spokespeople said.

On Tuesday, Rep. Joe Sweeney, a Salem Republican, said the bill was a forward-looking measure designed with New Hampshire’s energy future in mind, and the House Finance Committee ultimately recommended it for passage. The bill, which passed the House a first time in February, 191-149, will go before the full House later this year for a second vote.