Hartford Business Journal

HARTFORDBUSINESS.COM | FEBRUARY 10, 2025 11 West Hartford | Shelton 860-561-4000 CLAconnect.com ©2025 CliftonLarsonAllen LLP. CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See CLAglobal.com/disclaimer. Investment advisory services are offered through CliftonLarsonAllen Wealth Advisors, LLC, an SEC-registered investment advisor. NUMBERS. PEOPLE. It takes balance. ™ Unique problem Connecticut could apply for a Jones Act waiver specifically for maritime LNG shipments, due to the energy crisis it's facing, experts said. Waivers can be granted by the Department of Homeland Security (DHS). According to EIA data, Connecticut currently ranks third for the highest electricity rates in America, behind Hawaii and Rhode Island. While the state's economy has "accelerated" since the COVID-19 pandemic, O'Keefe said much of that growth — more than 12% — is in the manufacturing sector, which requires copious amounts of energy to power machines. "We have to solve comparative energy prices for our economy and our constituents now, and if I look at some of these innovations in the future, artificial intelligence, quantum computing, these are energy-centric innovations," O'Keefe said. "So, it's not only a problem for our economy now. It is, in my view, a problem for our economy in the future." O'Keefe said the state should continue to invest in renewable energy, which now represents about 10% of Connecticut's wholesale market, in addition to nuclear energy, which represents about 22%. But until those sources comprise a greater percentage of the state's energy supply, Connecticut needs to obtain more natural gas to reduce energy costs, experts say. O'Keefe said the state can increase its supply of natural gas in the longer-term by building pipelines to natural gas-rich regions such as the Marcellus Shale in Pennsylvania. Shorter-term cost savings could be achieved simply by importing LNG less expensively. Although it's rare for the DHS to grant states a waiver, O'Keefe believes Connecticut could support its case based on its major role in the nation's defense industry. "I would argue this is an emergency for our national defense, because our national defense, which is a significant portion of the Connecticut economy, is paying a significantly higher rate for energy," O'Keefe said. The issue has gotten the attention of the state legislature. State Rep. Chris Rosario (D-Bridgeport) has proposed legislation that requests Congress to amend the Jones Act, which could include easing LNG restrictions, or making it easier for states to obtain waivers. Rosario, former chair of the legisla- tive Black and Puerto Rican Caucus, said the bill would be particularly beneficial to trade relations between New England and Puerto Rico, which could serve as a hub for foreign maritime shipping. Focusing on reality O'Keefe, who describes himself as an environmentalist, said the reality is that Connecticut can't grow its renew- able energy sources fast enough to keep up with demand — or to keep prices from increasing. Lamont recently embraced natural gas and nuclear power, despite state initiatives that prioritize carbon-free energy. Compared to other fossil fuels, natural gas is considered a relatively low emission fuel, even though it releases methane. Seven of the state's 10 largest power plants by annual generation are natural gas-fired, according to the EIA. "My view is we should continue to invest in renewables while we work through this transition, but we have to also keep an eye on relative energy prices," O'Keefe said. "In other words, we can't just buy renewable energy regardless of price." O'Keefe noted that China releases more emissions every day than New England does in a year. "What Connecticut does, or does not do, will have zero impact on global warming," O'Keefe said. "So, we just have to start to focus on reality." 5K 4K 3K 2K 1K 0 2007 2015 2011 2019 2009 2017 2013 2021 2008 2016 2012 2020 2010 2018 2014 2022 2023 U.S. LIQUEFIED NATURAL GAS IMPORTS AND EXPORTS (IN BILLION CUBIC FEET) IMPORTS EXPORTS Data source: U.S. Energy Information Administration

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