With the recent announcement that National Grid would raise its electricity rates an eye-popping 37 percent this winter, New England is beginning to pay a real price for its stalled energy policy. The rate increase, which will hit some Massachusetts households to the tune of $150 a month, likely won’t be the last bad news this year: NStar, the state’s other major electric provider, is also expected to announce a rate hike soon. New England has always endured higher-than-average electricity costs, but this year’s price surge reflects a relatively new problem: With the retirement of many old coal-burning plants, natural gas now accounts for about half the region’s electricity generation, leaving utilities and their customers unusually exposed to spikes in gas prices.
The consequences for struggling families this winter will be dire, and are likely only a foretaste of what’s to come unless policy makers respond with urgency. Two strategies would lower electricity bills over the long term. First, the region needs to diversify its energy mix by bringing in more wind, solar, hydropower, and other renewables. Having more renewable energy will cushion the region against the ups and downs of the gas market, while also reducing carbon emissions. But the region has trouble handling the renewable energy that’s available already; making full use of the region’s rivers, wind, and sun will require new transmission lines from Canada and northern New England, proposals that create enormous backlash and, critics argue, mar pristine landscapes with ugly power lines. A proposal by the Patrick administration that likely would have resulted in more power lines failed in the Legislature earlier this year, a troubling reminder of the political obstacles to building needed transmission.
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But even fully integrating renewable resources into the grid won’t eliminate demand for natural gas; it’s not always windy or sunny. So while connecting to renewables must be a top priority to bring down costs, the region simultaneously has to tackle a second task: upgrading the natural gas network, which was never designed for the crucial role it now plays in New England’s electricity market. Congestion in the delivery network is one of the major drivers of this year’s price surge, and more pipeline capacity would lower prices. Several proposals have emerged. Yet pipelines are an even harder sell than transmission lines. They’re just as unsightly, and carrying more fossil fuels into New England seems like just the wrong approach when the goal is to reduce carbon emissions.
The task for policy makers is to combine the two goals in an environmentally sensible way, so that lower prices for natural gas will help, not hurt, the transition to renewables. The six New England governors have made some progress in that direction. Last year, they suggested offering financial support to a new pipeline into the region, paid for in part through an assessment on electric ratepayers, while at the same time pledging to also support transmission lines needed to reach renewables north of Boston. What the governors’ plan lacked, though, was an explicit commitment that the two would go forward in tandem. It will be much easier to convince a skeptical public to accept new gas investments if the arrangement also contains a firm commitment to help tap renewable resources.
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If may seem odd to pair the two goals. But there’s recent precedent in Massachusetts for harnessing dirty fuels to encourage clean ones. In Salem, environmentalists won an agreement to allow a gas-burning plant to open only as long as it agreed to a timetable to reduce emissions and eventually close. That agreement will bring needed electricity capacity online soon, contributing to the grid’s reliability, while also keeping the state on track to meet its long-term climate goals. On a larger scale, the region may need to strike just such a bargain to bring down its electricity costs while also helping renewables. New England needs new gas pipelines to prevent electricity prices from overwhelming families and small businesses, but can encourage them in a way that also builds a clean-energy future.
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