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V O L . X X I I N O. X I V J U N E 2 7 , 2 0 1 6 18 M aine has the lowest electric- ity costs in New England. So why are they so often cited as a problem for businesses both large and small? e simple answer is that many of them compete against companies in regions of the United States where electricity prices are even lower than those in Maine. "It is an advantage that we have the lowest electricity costs in New England," says Patrick Woodcock, director of the Governor's Energy Offi ce. "However, there are signifi cant limitations on what that advantage means in a global economy." e businesses that are most exposed are those that compete nation- ally or globally against companies in states with much lower electricity costs. Rarely is their competition limited to only the New England states, he says. Woodcock also points out that Maine employers owned by national companies — for example, Verso Corp., which has paper mills located in Minnesota, Wisconsin, Michigan, Kentucky and Maryland in addition to its mill in Jay — are often fl agged by the corporate offi ce whenever their costs stray outside the average. Electricity and heating costs are the obvious red fl ags. But Woodcock readily acknowledges the solutions are by no means simple, and they often refl ect radically diff erent views about the best short- and long- term pathways for achieving clean, reli- able and lower-cost electricity for both residents and businesses in Maine. Here's just one example: Both Woodcock and Gov. Paul LePage so far have failed to persuade lawmak- ers to lift the 100-megawatt cap on power generators seeking a renewable resource designation in order to tap what they believe would be lower- cost electricity from Hydro Quebec in Canada. Opponents, which include the Maine Renewable Energy Association, say lifting the 2009 ban would do little to supply Maine with lower-cost power — arguing that Hydro Quebec's export sales to the United States are more likely to be at a premium price. ey also say it would discourage con- tinued investment in renewable power within Maine by creating a glut in the Renewable Energy Certifi cate market that in-state renewable power compa- nies depend on for sales revenues. And so, the idea remains in limbo — but it's likely to come up again when the new Legislature convenes in January. Benchmarking electricity costs For Bath Iron Works — which employs 6,100 and is competing against two southern shipyards for a contract to build 25 new U.S. Coast Guard off shore patrol cutters that could be worth an estimated $12.1 billion — achieving lower electricity costs is vital to its continued success. "Multiple electricity Independent System Operators (ISOs) in the United States indicate that electricity costs in New England are some of the highest in the nation. Higher electricity costs do contribute to a competitive disadvantage " " " Align Your Technology with Your Business " Colors Pantone 2747 Pantone 1807 IT Solutions Designed for Your Business Finding the right IT partner is one of the most important decisions your company can make. At WGTECH, making information technology work for your business is our core competency. We develop individualized solutions that help you grow your business, improve operations, and boost efficiency. We're Northern New England's resource for advanced technology – we'd like to partner with you. www.WGTECH.com 207.856.5300 Myth or fact? Maine has the lowest electricity rates in New England, but complaints endure B y J a m e s M c C a r t h y M A I N E ' S E N E R G Y I N D U S T R Y F O C U S Average price of electricity to ultimate customers by end-use sector (Cents per kilowatt hour, March) S O U R C E : U.S. Energy Information Administration Mississippi Louisiana Florida Alabama New England avg. Vermont Rhode Island New Hampshire Massachusetts Maine Connecticut 0 5 10 15 20 25 Commercial Industrial Residential Maine's electricity supply costs are determined by the New England wholesale market prices, which generally track the cost of power generated by natural gas. The chart below is based on the U.S. Energy Information Administration's most recent monthly update, which shows Maine having the lowest costs in New England for residential, commercial and industrial ratepayers. Four southern states are included for comparison, since they are where Bath Iron Works' chief competitors are located. Prices refl ect supply, distribution, transmission and stranded costs.

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