Regulators, businesses, media weigh in on Connecticut’s energy future
By Lesia Winiarskyj
In his 2015 energy forecast, delivered at this year’s 21st Century Energy: What’s the Deal conference, DEEP Commissioner Robert Klee noted that with a “cheaper, cleaner domestic energy supply just 90 miles away,” his agency is aiming for 50% natural gas penetration in Connecticut to achieve parity with neighboring states.
He acknowledged, however, that natural gas is not a viable option for the foreseeable future in half the state, “which is why need to keep pursuing energy efficiency…and driving down the cost of alternatives.”
Noting that “there are limits to what consumers can and will pay,” Klee called for leveraging more private capital to reduce subsidies—crowdsourcing, the Groupon approach, and other innovative ways to encourage deployment at scale.
‘It All Boils Down to…’
“We’ve entered a very volatile period in our energy market,” said Deputy Commissioner of Energy Katie Scharf Dykes, underscoring the challenges to sustaining a competitive economy.
“It all boils down to a problem of inadequate infrastructure.”
Connecticut’s pipeline constraints and limited natural gas buying capacity, said Dykes, resulted in $3 billion in additional costs last winter and are expected to keep prices elevated this winter too.
Stopgap solutions such as increased reliability on coal and oil “take us backward from a cost perspective [by increasing wholesale electricity costs] and an environmental perspective,” she said.
“And the problem will only get worse.”
‘Too Big for One State to Solve’
Price volatility in New England will continue, said Dykes, until three things happen: we secure adequate natural gas infrastructure; we diversify our energy supplies to include more renewables and large-scale hydropower; and we reduce consumption of electricity or gas—or both.
She acknowledged, too, that our energy challenge requires a regional approach, such as the New England Governors’ Energy Infrastructure Initiative, which would expand natural gas and renewable energy infrastructure capacity by appropriate cost-sharing—cooperative investments in pipelines, electric transmission, renewable generation, and energy efficiency across the six New England states.
“This problem is too big for one state to solve on its own.”
The Politics of Energy
21st Century Energy: What’s the Deal was held on Oct. 8—less than four weeks before Election Day, when Connecticut’s race for governor was in a dead heat.
Moderating a panel of reporters, Connecticut Radio Network News Director Steve Kotchko asked why the gubernatorial candidates weren’t more vocal about their energy strategies—especially with energy prices expected to spike again this winter.
“Cheaper has left town,” said Mark Pazniokas, Capitol bureau chief at CTMirror.org, calling energy a politically “dangerous and difficult issue,” one that requires nuance and complexity—which, he noted, don’t work well in political campaigns.
“This is not an easy issue to tackle, with so many moving pieces,” he said, referring to changing markets, technology, environmental impacts, regulatory policy, and something that Kevin Hennessy, New England director of federal, state and local affairs for Dominion Resources called a “mismatch in the gas and electricity markets,” with the natural gas industry based on long-term contractual agreements (commonly 1511–20 years), while New England’s electricity industry operates on short-term market price signals—up to seven years for new resources and year-to-year for existing ones.
Echoing Dykes’ remarks, Pazniokas reiterated that any meaningful change in transmission capacity in New England is a regional problem, which complicates the issue of having a single gubernatorial hopeful make energy a key part of his or her platform.
Luther Turmelle, north bureau chief for the New Haven Register, agreed.
“A lot of what determines the price of energy does not happen at the state level, so it’s kind of disingenuous for anyone to claim victory for lower prices.” [Read more...]