Business & Tech

Lawmakers reach late-night compromise on energy bill

This hydro dam in Baie-Comeau, Quebec, could benefit from provisions of the energy bill that passed through the state Legislature on Sunday.
Jacques Boissinot/The Canadian Press/AP/File
This hydro dam in Baie-Comeau, Quebec, could benefit from provisions of the energy bill that passed through the state Legislature on Sunday.

In the frantic final hours of the legislative session Sunday night, House and Senate leaders agreed to a compromise energy bill that would spur big utilities to buy large amounts of electricity generated by wind farms and Canadian dams, but could also lead to moderate rate hikes.

The compromise bill, reached with just hours to go before lawmakers adjourned from formal sessions for the year, hewed more to the House proposal: a streamlined approach that would shift the state’s energy mix to include more hydro and wind power.

The Senate had proposed a much wider array of energy measures, but many of those didn’t make it into the final bill.

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The compromise calls for the big utilities to buy up to 1,600 megawatts of off-shore wind energy. The language, however, would freeze out the controversial Cape Wind project from competing for those contracts.

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The bill also calls for big utilities -- namely Eversource and National Grid -- to buy up to 1,200 megawatts of clean energy from the north, likely either hydropower from Canada or electricity from wind farms in northern New England and upstate New York.

Supporters say the bill could help the state meet its aggressive greenhouse gas reduction goals while diversifying the energy supplies as a number of older power plants shut down. The bill could also help create an entirely new industry in the state, as offshore wind developers use the contracts required by the bill to finance wind farms many miles to the south of the New England coastline.

“This is a huge victory for off-shore wind both for our environment and our economy,” George Bachrach, president of the Environmental League of Massachusetts, said in an e-mail. “It’s also a victory for diversifying our energy portfolio away from fossil fuels by adding both wind and hydro.”

But there’s a downside: the potential for extra costs, to be borne by ratepayers. It wasn’t clear Sunday night what those additional expenses would be, but critics expect consumers will pay some kind of a premium for the clean energy.

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“This bill could be the largest of any utility rate hike in [the state’s] history,” said Dan Dolan, president of the New England Power Generators Association.

Dolan said he’s worried that some of his members’ power plants could be put out of business as a result of the preferred treatment that hydro and wind power are getting.

Despite losing the fight for a broader bill, the Senate scored at least one important victory with language aimed at encouraging the development of electricity storage systems in the state to help guarantee there is enough power during times of peak demand.

But several other Senate-backed provisions were scrapped. One discarded proposal would have doubled the rate of increase in the amount of renewable electricity utilities are required to buy, and another would have banned any electricity tariffs from being used to pay for natural gas pipelines.

The bill was later passed by the full and House and Senate and sent to the governor.

Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.