Massachusetts State Senator
Sen. Michael Barrett of Lexington, the Senate chair of the Telecommunications, Utilities, and Energy Committee, has raised concerns about removing the cap at a time when the state is relying more and more on low electricity prices to bolster its climate change efforts. He has done price comparisons showing that Massachusetts procurements for offshore wind are priced well below those of other states where price caps do not exist.
At least one influential opponent — state Sen. Michael Barrett, a Democratic co-chair of the joint committee — counters that erasing the price requirement would be unnecessarily risky for Massachusetts ratepayers, however. “Massachusetts consumers are better off with constraints on project prices,” Barrett wrote in a Jan. 10 letter to the governor.
The state’s climate goals, which include a 50 percent greenhouse gas emissions cut by 2030 and net-zero emissions by 2050, envision a massive shift from gas cars and building heat appliances toward electric technologies, he wrote, making controls on the price of electricity especially important in coming years.
Other Northeastern states have often agreed to pay far more for offshore wind, ranging up to about double the per-kilowatt rate in Massachusetts, Barrett noted in the letter.
The price requirement had been successful in bringing new jobs and investment to the state, Barrett told the governor during the latter’s appearance before the joint committee yesterday. Baker supported the requirement five years ago, when the economics of offshore wind were far less well-established.
Senate co-chair Michael Barrett was skeptical of the idea of outright elimination of the price cap when Baker filed his bill and on Monday evening released a letter he sent to Baker and Theoharides asking that they stop their push to lift the price cap.
“The cap protects everyone in Massachusetts who pays a monthly electric bill,” Barrett wrote. He added, “To respond to global warming, we need to go all-electric with respect to both our cars and our heating systems. Which means we need to boost our overall consumption of electricity, in the teeth of the region’s high per-unit costs. It’s a sensitive time to be asking legislators to drop a legal safeguard for their constituents.”
Sen. Michael Barrett, a Lexington Democrat, has filed a bill that would add a new option for taxpayers to give to a United Nations fund supporting developing countries vulnerable to climate change. But he’s also calling for a more regular review of the existing options taxpayers have to make donations through their tax filings.
Sen. Michael Barrett of Lexington has outlined his position previously — that reaching the state’s emission goals hinges on electrification of transportation and heating and low electricity prices make that task possible — but the footnoted letter dived into the details.
Barrett said the state’s procurements have attracted respectable onshore economic development — including the promise of a transmission cable factory at Brayton Point in Somerset — while keeping the price of offshore wind electricity well below the price in every other state. He noted Massachusetts prices have been 43 percent, 68 percent, and 100 percent less than similar deals in New York, Connecticut, and New Jersey, respectively.
Removing the cap, Barrett said, would put Massachusetts at the mercy of a handful of offshore wind companies that he described as an oligopoly. “We can’t count on competition to substitute for a price cap,” he said.
State Sen. Michael Barrett, the co-chair of the Committee on Telecommunications, Utilities and Energy, argued the cap has kept the price per kilowatt-hour from Massachusetts projects lower than in neighboring states, like New York and Connecticut.
“My request to you is that you not walk away from the wisdom that has assured us getting a break today,” he told Baker.
House chair of the Legislature’s energy committee, Representative Jeff Roy, supports removing the price cap. But his cochair, Senator Mike Barrett, pleaded against it, arguing it could cause electricity prices to jump and thereby put ratepayers at risk.
He noted New York, Connecticut, and New Jersey, none of which have caps on the price of offshore wind projects, have each paid much more for offshore wind than Massachusetts has so far. For instance, while power from the Commonwealth’s Mayflower Wind project will come with a cost of $58 per megawatt hour, New Jersey is paying twice that much for energy from its Ocean Wind project.
“I want to ask the two of you whether you want to run the risk of these kinds of figures if we simply jettison the cap altogether,” Barrett said, addressing Baker and Theoharides.
Senator Mike Barrett, Senate Co-Chair of the Legislature’s Committee on Telecommunications, Utilities and Energy, is asking Governor Charlie Baker to drop his Administration’s push to lift price caps on offshore wind deals.
“The cap protects everyone in Massachusetts who pays a monthly electric bill,” Barrett writes. A Baker bill that abolishes the cap, among other things, is set to be heard tomorrow by the Committee.
“I strongly support clean energy in general and offshore wind in particular,” Barrett writes. “I take exception, however, to your proposal to abolish the cap. … I think you were right the first time, in 2016, when you supported legislative language imposing just such a cap, and the
second time, in 2019, when you suggested lifting the cap for just a single round and reimposing it for later rounds.”
Barrett, a legislative leader on climate issues, is concerned that “ratepayers could be confronted with unnecessarily steep electricity bills, associate them with climate policy, and rebel against
both.”
“To respond to global warming,” he says, “we need to go all-electric with respect to both our cars and our heating systems. Which means we need to boost our overall consumption of electricity, in the teeth of the region’s high per-unit costs. It’s a sensitive time to be asking legislators to drop a legal safeguard for their constituents.”
“Thanks to last month’s announcement on third-round contracting,” Barrett adds, “we now know the cap has prevented neither the developers nor our coastal cities from coming out of contract negotiations as winners. Importantly, the cap ensures that families throughout the state win,
too.”
As for the job implications, he writes, “Though it’s extremely early in the industry’s build-out in Massachusetts — preparations for the first project, Vineyard Wind I, have only just begun — it’s possible to take a preliminary tally of associated economic development activity,” Barrett writes.
“Judging from the positive reactions from all around Massachusetts, including your office, it’s hard to argue that the price cap has stifled job creation.”
Barrett’s letter also lists the wholesale electricity prices set in the Massachusetts deals shaped by the cap and compares them to the prices set in comparable deals struck in New York, Connecticut, and New Jersey, none of which featured price caps.
“The numbers make the Massachusetts approach look very good,” Barrett concludes.
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Senator Mike Barrett, Senate Co-Chair of the Legislature’s Committee on Telecommunications, Utilities and Energy, is asking Governor Charlie Baker to drop his Administration’s push to lift price caps on offshore wind deals.
“The cap protects everyone in Massachusetts who pays a monthly electric bill,” Barrett writes.
A Baker bill that abolishes the cap, among other things, is set to be heard tomorrow by the Committee.
“I strongly support clean energy in general and offshore wind in particular,” Barrett writes. “I take exception, however, to your proposal to abolish the cap. … I think you were right the first time, in 2016, when you supported legislative language imposing just such a cap, and the second time, in 2019, when you suggested lifting the cap for just a single round and reimposing it for later rounds.”
Barrett, a legislative leader on climate issues, is concerned that “ratepayers could be confronted with unnecessarily steep electricity bills, associate them with climate policy, and rebel against both.”
“To respond to global warming,” he says, “we need to go all-electric with respect to both our cars and our heating systems. Which means we need to boost our overall consumption of electricity, in the teeth of the region’s high per-unit costs. It’s a sensitive time to be asking legislators to drop a legal safeguard for their constituents.”
“Thanks to last month’s announcement on third-round contracting,” Barrett adds, “we now know the cap has prevented neither the developers nor our coastal cities from coming out of contract negotiations as winners. Importantly, the cap ensures that families throughout the state win, too.”
As for the job implications, he writes, “Though it’s extremely early in the industry’s build-out in Massachusetts — preparations for the first project, Vineyard Wind I, have only just begun — it’s possible to take a preliminary tally of associated economic development activity,” Barrett writes. “Judging from the positive reactions from all around Massachusetts, including your office, it’s hard to argue that the price cap has stifled job creation.”
Barrett’s letter also lists the wholesale electricity prices set in the Massachusetts deals shaped by the cap and compares them to the prices set in comparable deals struck in New York, Connecticut, and New Jersey, none of which featured price caps.
“The numbers make the Massachusetts approach look very good,” Barrett concludes.
END
“Given the stakes, it’s fair to say the nation itself will be on the ballot. But while this is true, it is not the only thing that is true. The nation will be on the ballot again in 2024. And 2026. And 2028. The divisions that haunt the United States are not going to heal in any one election cycle,” Barrett said in his speech. “Now there are those who say that we face nothing less than the death of American democracy in 2022. I respectfully disagree. You could say we face the essence of American democracy in 2022. Because nothing is more essential to democracy — this year and every year — than our striving to move a country of 329 million closer to being the best possible version of itself.”
