Eversource Energy is promoting longtime executive Joe Nolan to the CEO’s job on May 5, when Nolan will take over for Jim Judge to be in charge of day-to-day operations of New England’s largest utility company.
The board of directors met by videoconference on Wednesday to approve Nolan’s promotion. Judge, who is 65, will stay on as executive chair, overseeing strategic planning and staying involved in investor and industry relations.
As chief executive, Nolan will oversee a company with about 9,300 employees, spanning three states, with 4.3 million customers among regulated businesses in electricity, gas, and water utilities. Eversource also has a growing offshore wind development portfolio through a joint venture with Ørsted, a Danish company, that Nolan has been leading on behalf of the utility as one of his responsibilities in his current job as executive vice president of strategy, customer, and corporate relations.
Eversource has a market value of $30 billion, and reported operating revenues in 2020 of $8.9 billion.
Nolan, 58, said he is excited about continuing Judge’s long-term vision for a carbon-neutral future, with a focus on renewable sources of electricity, energy efficiency, and smarter grid systems. That future might also include a shift to hydrogen from the natural gas fuel currently used to heat homes.
“Everyone thinks this business is a sleepy business,” Nolan said in an interview. “It’s not. The innovation that’s taking place in this business is going at warp speed.”
Greening the grid comes with its challenges though. For example, Nolan expects Eversource will need to build additional substations to keep up with electricity demand, as policymakers spur transportation and heating users to shift to electric sources. Eversource in February received state approval for a new substation near Chelsea Creek in East Boston, despite fierce community opposition.
Nolan’s base salary will rise to $1.2 million as a result of the promotion, and his potential cash bonus could reach $1.3 million, plus he could receive stock awards valued at $5.4 million. Nolan earned a salary of $631,000 last year, and a cash bonus of $850,000, along with Eversource shares valued as much as $1.4 million.
The Belmont resident got his start literally on the ground floor some 35 years ago, working in customer relations at a former Boston Edison office in the Prudential Center plaza. Now, as executive vice president, he works on the 17th floor of the Prudential tower, the utility’s longtime home when it was known as Boston Edison and then NStar.
The company has had a second headquarters office, in Hartford, since the 2012 merger between NStar and Northeast Utilities that created Eversource. But Judge and Nolan have come up through the ranks in Boston, as did Judge’s predecessor, longtime CEO Tom May.
Nolan is already plugged into Boston’s business community, including through board seats at Boston Children’s Hospital, Camp Harbor View, and the New England Council.
“He’s got all the credentials to be a very good CEO,” said Jim Brett, the New England Council’s chief executive. “He is the full package.”
Nolan was Eversource’s top lobbyist in 1997, when the state’s industry restructuring law was passed. That prompted what was then Boston Edison to divest its power plants, essentially forcing it out of the generation business.
“My father would say to me, ‘What type of Boston Edison company doesn’t own power plants?’” Nolan said. “We used to look out the window [in the Pru tower] and see the South Boston and Everett plants. All of a sudden, they were gone.”
In recent years, Eversource has returned to owning power generation again, but only renewables. The company has built about 70 megawatts worth of solar panels in Massachusetts, and is planning to take advantage of a provision in the newly signed Massachusetts climate law to put up many more panels.
On a bigger scale, the joint venture’s offshore lease areas south of New England and off the Long Island coast offer the potential to generate up to 4,000 megawatts of electricity eventually, or enough power for more than 2 million homes. Eversource and Ørsted together have contracts to start building three wind farms, with a 130-megawatt Long Island project, known as South Fork Wind, the first in line. Construction efforts will be primarily based out of the port of New London.
“It has just been a sea change for our business to exit [fossil fuel] generation and to move into clean energy generation,” Nolan said.
Jim McGaugh, head of US state government affairs at Boston-based General Electric, said Nolan and Judge have made a great team as they maneuver Eversource through the challenges of the industry’s clean-energy transition. McGaugh worked under Nolan at NStar for several years in the early 2000s.
“The guy has an unparalleled understanding of the industry,” McGaugh said. “He has worked at every single level. He’s respected inside the organization, which is really important, but he’s also respected externally. He has an uncanny ability to focus on getting today’s job done while looking into the future and imagining what that could be.”