New gas pipelines spurned: no subsidies from electricity rates

If operators of interstate natural gas pipelines succeed in getting permits for expansions in Massachusetts, they will have to raise their own funds to install new lines. On Wednesday, August 17, the Supreme Judicial Court ruled out schemes that would have subsidized new gas pipelines from Massachusetts electricity bills.

Utility companies Eversource and National Grid had proposed to acquire interests in new gas pipelines and load costs upfront onto electricity rates. The Baker administration and its Energy secretary, Matthew Beaton, had supported the schemes–similar in effect to construction-work-in-progress tariffs used to force electricity customers in Georgia and South Carolina to pay for new nuclear power-plants while they are being built.

Corrupt schemes: Attorney General Maura Healey and state Sen. Stanley Rosenberg (D, Amherst), the senate president, opposed the corrupt schemes. They were joined by the Conservation Law Foundation in responding to a lawsuit filed by interests in natural gas import terminals. Imports of liquefied natural gas, while more expensive than domestic pipeline gas, have helped to reduce and prevent wintertime price spikes. As documented in 2015 by Analysis Group of Boston, that approach costs less overall than installing new interstate gas pipelines.

In what looks to be his last opinion, Justice Robert Cordy wrote for a unanimous court, finding that the Baker administration’s regulation, allowing pipeline construction tariffs, was “invalid in light of the statutory language and purpose” of the Electricity Restructuring Act. [Chapter 164 of the Acts of 1997] Specifically, Justice Cordy wrote, the Baker administration’s regulation “would undermine the main objectives of the act and re-expose ratepayers to the types of financial risks from which the legislature sought to protect them.”

It was a conclusive decision, putting paid to the corrupt schemes engineered by the pipeline companies and to the corrupt regulations adopted by their Republican sweethearts in state government.

– Craig Bolon, Brookline, MA, August 17, 2016


ENGIE Gas & LNG LLC v. Department of Public Utilities, Massachusetts Supreme Judicial Court, Case Nos. SJC-12051 and SJC-12052, August 17, 2016

Jon Chesto, SJC rejects Baker’s plan to impose fee for gas pipelines, Boston Globe, August 17, 2016

Naureen Malik, The U.S. has more gas than it needs and Boston’s importing, Bloomberg News, April 13, 2016

Craig Bolon, Will New England revive nuclear power?, Brookline Beacon, August 10, 2016

Craig Bolon, Little need for new gas pipelines, Brookline Beacon, July 20, 2016

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