The move was made, said Public Advocate Timothy Schneider, after his office reviewed its previous position and decided that the deal would neither undermine state utility regulation nor would it threaten ratepayers with higher energy prices.
“We have a mandate to protect ratepayers,” said Schneider. “That’s what we did,” he said, referring to the legal brief filed on Friday.
The public advocate was a key opponent of the proposed deal when it was considered by the PUC in 2011 and 2012, saying that it would violate the state’s landmark electricity Restructuring Act and hurt ratepayers by raising prices.
Despite the opposition of the public advocate and several other parties, the PUC approved the transaction in 2012. The public advocate then filed an appeal with the state’s highest court, as did the other parties that opposed it, and the court dealt a blow to the deal by vacating the PUC’s approval and sending it back to the agency for reconsideration.
Now, as the PUC prepares to again review the deal under a different set of standards imposed by the court, the public advocate is no longer among the naysayers.
The transaction is a joint venture owned by First Wind and Nova Scotia energy giant Emera, and also involves Emera-owned utilities Bangor Hydro and Maine Public Service. The venture, called Northeast Wind, currently owns nine operating wind projects in the Northeast and is developing more.
The public advocate’s office asserted in legal filings that the deal would hurt ratepayers by violating the state’s Restructuring Act, which prohibits utilities from owning both transmission and generation because it is anti-competitive and contributes to high electricity prices.
Those filings were made by a staff attorney when the public advocate’s office was run by Richard Davies, a former Democratic legislator and Baldacci administration official. Schneider, a former energy and utilities lawyer from Portland firm Pierce Atwood, was appointed by Gov. Paul LePage to the position in early 2013 and his appointment was unanimously supported by the members of the legislature’s Committee on Energy, Utilities and Technology.
Despite opposition from the public advocate and other groups, as well as its own staff’s opposition to the deal, the PUC approved the Emera-First Wind transaction in 2012. Shortly afterwards, the public advocate, the Houlton Water Company and the Industrial Energy Consumer Group, which supports lower energy prices, appealed the approval to the state’s highest court.
Just days after the legal appeals had been filed with the court in 2012, Emera and First Wind consummated the joint venture.
The court ruled unanimously on the appeals in early March, saying that the PUC used the wrong standard to approve the deal. The court vacated the PUC’s approval and told the commission to reconsider the deal using the standard articulated by the court in its opinion.
The new standard, said the court, was whether an affiliation such as that proposed by transmission company Emera and power generator First Wind would lead to favoritism by Emera, giving First Wind an unfair advantage over other generators in getting access to Emera’s transmission lines.
The reconsideration gave parties in the case the opportunity to file new legal briefs with the PUC in support of, or opposition to, the joint venture. That opportunity led his agency to rethink its position, said Schneider, who said he expected his background representing electricity and natural gas companies would raise questions about his office’s about-face on the deal.
“This was a really polarized case,” said Schneider. “I was surprised by the level of animosity between the parties, I’d never seen that before.”
In the two years between the commission’s approval of the deal and now, said Schneider, Emera, First Wind and their related companies had conducted business in ways that alleviated his agency’s concerns about potential favoritism.
“We know things now that we didn’t know then,” said Schneider.
Andrew Landry, an attorney for the Industrial Energy Consumer Group, said that his client’s position on the joint venture had not budged.
“We’re obviously disappointed that they’ve come to a different conclusion than we have,” said Landry. “We think that the transaction is potentially very harmful to customers because of the relationship that’s created between utilities and generators.”
(The Maine Center for Public Interest Reporting is a nonpartisan, non-profit news service based in Hallowell. For more information email mainecenter@gmail.com or visit online at http://pinetreewatchdog.org).
