Utilities committee weighs proposals to harness more hydropower for Maine
The former Great Works Dam site between Old Town and Bradley, Maine on the Penobscot River. (via Penobscot River Restoration Trust)
As Maine has honed in on solar and offshore wind to fulfill its clean energy goals, Republicans have introduced multiple bills this session to move the conversation forward on other renewable energy sources, including nuclear and now hydroelectric power.
'It is a smart, practical step toward reducing electricity costs for everyone in Maine, while making sure our renewable energy future remains affordable and reliable,' said Sen. Jeff Timberlake (R-Androscoggin).
'I don't understand how this is not the right thing to do,' he told the Legislature's Energy, Utilities and Technology Committee during a public hearing Thursday that could tee up hydroelectric power expansion in the state.
The committee meeting started nearly four and a half hours late because of a marathon session in the House of Representatives over the biennial budget, so some people who wanted to testify couldn't stay. Though hydropower is reliable, clean and affordable, it also has high upfront costs and some of the proposals could alter a valuable revenue stream for renewable energy generators.
Three of the bills, including the one sponsored by Timberlake (LD 204), have to do with removing a current capacity limit on electricity sources that qualify for the incentives outlined in Maine's Renewable Portfolio Standard.
That standard spells out renewable energy goals and helps to stimulate interest for new investments in renewables. For Maine, those goals are currently to have 80% of electricity sales in Maine coming from renewable resources by 2030 and 100% by 2050. The standard also stipulates how much of that needs to come from new or existing resources.
The other piece of legislation presented Thursday outlines a proposed study on expanding the use of hydroelectric power as well as developing geothermal energy sources in the state. Rep. Mathew McIntyre (R-Lowell) said he's open to amending his bill that currently proposes the Public Utilities Commission undertake the work.
The commission, as well as the Office of Public Advocate, testified neither for nor against the study proposed in LD 300 but said it would be better suited for the Governor's Energy Office, which did a similar study in 2015.
The Maine Renewable Energy Association shares the goal of expanding hydropower, but also supports a recommendation born out of the previous study.
Hydropower is capital intensive and has a long payback period, which can make new developments cost prohibitive, said Executive Director Eliza Donoghue. However, she also said it is 'exceptionally reliable' and often outperforms other renewables.
Waterflow in rivers isn't weather dependent like solar and wind, which causes those renewable energy sources to be more intermittent.
While she isn't opposed to the study suggested in LD 300, she said her organization would focus on refining eligibility requirements under the renewable portfolio standard for existing hydropower in Maine. That change and other tweaks could create an additional revenue stream for current facilities, she argued.
The other three bills presented to the committee also suggest small changes to the portfolio standard; however, Donoghue opposed these bills on the grounds that those particular changes would undermine the goal of in-state investment by welcoming in large-scale hydropower facilities located outside of Maine.
Those bills would remove the 100-megawatt maximum capacity limit that currently exists for an electricity source to qualify as a renewable resource under the state's renewable resource portfolio requirement. While LD 371 from Sen. Joe Martin (R-Oxford) only looks to remove that cap for hydropower, LD 204 and LD 638 from Rep. Don Ardell (R-Monticello) would apply to other renewables including biomass generators, geothermal and more.
LD 371 also seeks to amend the process for the Maine Department of Environmental Protection to approve a new hydropower project. The department, however, opposed the bill saying those changes would not allow enough time for public input and certain federal requirements.
Though hydropower facilities are not currently prohibited from being larger than 100 megawatts, going beyond that precludes them from a financial incentive, namely renewable energy credits, that come with qualifying for the portfolio.
Renewable energy credits — often called RECs — track how much clean energy is being produced. Renewable energy generators like a hydropower or biomass facility that qualify as part of the state's renewable portfolio earn credits that they can sell. Those credits offer an additional revenue stream that clean energy generators can use to cover development costs.
Rep. Gerry Runte (D-York) raised questions as to whether the economics of expanding or upgrading a hydropower facility hinges on those credits, which some of the bill sponsors asserted. He said he would like to see data comparing the cost of those projects with and without the credits.
Removing the 100 megawatt cap could open the door for more renewable energy suppliers and ultimately reduce the value of the renewable energy credits, said Deirdre Schneider, testifying neither for nor against the bills on behalf of the Public Utilities Commission. While that reduction in value could lower costs for ratepayers, there was also discussion about it potentially deterring developers from coming to Maine.
Similar to Donoghue, the Maine Forest Products Council opposed the bills out of concern that removing the cap would welcome large hydropower projects and dilute the value of those energy credits. As some biomass plants and pulp mills have shut down, the credits have become more valuable, said Executive Director Patrick Strauch, in written testimony.
'For years, Maine's RECs were essentially worthless until a limit was set almost two decades ago,' Strauch said. 'If these bills were to move forward, I am certain we would revert back to an environment where these RECs would be of little to no value.'
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