One year ago, the NHTOA successfully lobbied to get Senate Bill 129 into law. The bill, however, is not a permanent solution to improving biomass markets, and its three-year modification of New Hampshire’s RPS law is intended to provide a bridge while policymakers find a permanent, long-term solution to sustain New Hampshire’s biomass industry. Since SB 129’s passage and adoption into law, a lot has happened.
Part of Senate Bill 129’s adoption included directing the Governor’s Office of Strategic Initiatives (GOSI) to conduct a study on the economic viability of electric renewable portfolio standard Class III biomass electric generation resources in New Hampshire. This study will look at the wholesale electricity rates needed to sustain the biomass power plants and the number of jobs and economic activity directly attributed to the operation of the biomass power plants. The study may also analyze ratepayer impacts. This study is due at the end of 2018. To date, the NHTOA and representatives of the biomass power plants have met with the GOSI to share the economic data we gathered last year for the SB 129 debate and to offer assistance with GOSI’s effort. GOSI is still gathering data, and the office plans to have the report prepared well in advance of the December deadline. The NHTOA will continue to work with the GOSI as they prepare their report.
Concurrent to GOSI’s effort, the NHTOA and representatives from biomass power plants continue to meet with legislators in Concord who are reviewing bills and policies that could provide the permanent, long-term solution. Interestingly, last month’s record cold temperatures and corresponding natural gas shortage for electricity generation, which drove wholesale electricity prices to spike, got the attention of lawmakers and put a point on one of our central arguments: that biomass power plants provide fuel diversity to the regional grid which is heavily dependent on natural gas (in most days over half the power comes from natural gas combustion). Biomass’s fuel diversity is a hedge against natural gas price spikes.
With this in mind, lawmakers are looking at two areas of New Hampshire electricity law that could provide an opportunity for the state’s fleet of biomass power plants to help stabilize wholesale power pricing while giving these plants a stable market to sustain their operations. The first area of law deals with how New Hampshire utilities satisfy their default power needs (i.e., baseload power). The second area of law pertains to “microgrids” (i.e., allowing direct power sales between power plant and electricity consumer on a local level). As lawmakers grapple with these laws, the NHTOA and representatives of the biomass power plants are participating in these discussions. These concepts require careful evaluation. It may be the case that a sustainable biomass future requires compensating biomass on a basis other than one tied to natural gas pricing, which will vary with the weather. The weather-induced price swings of natural gas pricing will not support sustainable biomass generation and have the effect of creating a less diverse generation mix. At this point we do not have a single solution to point towards and direct NHTOA members to advocate on. As soon as a single solution emerges, we will let you know.
On a positive note, the thousands of letters, emails, phone calls, and articles placed over the past 18 months continue to resonate with lawmakers and motivate them to work towards a long-term, sustainable solution. As the GOSI prepares its report and we continue to work with lawmakers over the next two legislative sessions (2018/2019), the NHTOA will continue to keep you informed of our progress and, more importantly, how and when we need to engage our elected officials.
2018 is an election year. As our current Representatives, Senators and the Governor (and the candidates for these elected positions) begin their biennial campaign cycle this summer, we will work to insure renewable energy, biomass in particular, is a top campaign issue.