Worcester Business Journal

www.wbjournal.com February 1, 2016 • Worcester Business Journal 15 >> B A N K I N G & F I N A N C E MEMBER FDIC MEMBER DIF countrybank.com • 800.322.8233 • Business Banking Specialists Focused on Your Success Peter Rovezzi, Business Development Officer; Carla Alves, Vice President, Business Development; Shana Hendrikse, Business Development Officer; Tracey Wrzesien, Business Development Officer Put our team to work for you. Competing in today's business environment means surrounding yourself with the best. That's how you hire employees. Do the same with your bank. For the business banking products and services you need to succeed, connect with our business banking specialists today by visiting countrybank.com/business/business- banking-specialist. turn," said Jackie Barry, spokeswoman for National Grid, a major transmission owner. Lucrative investments Transmission investments have ramped up in New England and else- where over the past decade, largely in response to a 2005 federal law guaran- teeing utilities a return on equity of 11 percent or more for grid-reliability improvements. "Transmission is the most lucrative thing utilities can own," said Amy Boyd, a senior attorney with the Acadia Center in Boston, a clean-energy advo- cate that has studied New England's rising transmission rates. Acadia, Healy, OCC and Connecticut Attorney General George Jepsen were all involved in various FERC com- plaints, originating in 2011, arguing that the guaranteed returns were too generous. They had some success, but Boyd believes the recent FERC review could have more significant impacts on transmission costs. Eversource, one of the region's major transmission owners, completed three transmission projects in late 2014 and 2015 with a combined price tag of $1.26 billion. The company has approximate- ly $1.75 billion worth of major ongoing transmission projects, though the larg- est — the $1.3 billion Northern Pass project — won't impact rates because it's a merchant line being funded by private developers, said Eversource spokesman Frank Poirot. While major transmission projects have led to higher charges on utility customer bills, Poirot defended them as good investments, reducing congestion charges and boosting reliability for ratepayers. "What we provide in transmission is a very good value for the dollar," he said. National Grid's Barry said the region's congestion charges fell nearly 90 per- cent, to $38 million, between 2005 and 2010. Transmission owners have also been impacted by a surge in power plant clo- sures in recent years, Poirot said. "Transmission is the link between our customers and those generating plants," he said. "So as those plants go off and their regions no longer become a source for generating power, then we have to find other areas." Boyd said her organization has advo- cated for alternative initiatives to create a more reliable grid, other than expensive transmission projects, including renew- able energy and distributed generation. Such alternatives are potentially cheaper, but she said they are at a disad- vantage because current rules do not allow their cost to be spread across the six-state New England region like the cost of transmission projects. Acadia contends that ISO-New England understates the impact of such alternatives in its forecasting of future electricity demand, which could lead to the construction of unneeded transmis- sion projects. n

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