Thank you, Gov. Sununu

New Hampshire finally has a governor who is willing to stand up and defend the electricity ratepayer. Earlier this year, Gov. Chris Sununu vetoed a bill that would have further subsidized the use of biomass to generate electricity in the state. When the Legislature meets this fall, they would be wise to ensure his veto is sustained.

A core part of the current State Energy Strategy is to secure the most cost-effective forms of energy. Within the scope of the overarching strategy, Gov. Sununu’s decision to veto a $90 million biomass subsidy is well justified. Our governor is not opposed to biomass – or any form of renewable energy for that matter. Our governor understands that the biomass industry has been a valuable part of the state’s economy. This was made evident by his decision to allow SB 129 to become law last year, which increased revenue for the state’s wood-burning electricity generators from the sale of renewable energy certificates. However, our governor also understands that it should not be the ratepayers’ responsibility to keep for-profit biomass plants in business.

After the passage last year of SB 129, biomass producers should have developed a pathway to profitability. Before they receive additional funds, they should share how they plan to stay in business with this extra support. Without this timetable, this subsidy is not a mere one-time fix, but rather a long-term reliance on ratepayers. The State Energy Strategy supports the use of limited government intervention, in certain cases where it is warranted. Gov. Sununu is on record for his support of limited and effective subsidies, but this biomass subsidy is unequivocally neither. This biomass subsidy would not only inevitably fail to save the biomass industry, but it would also violate the state’s energy deregulation statute that stipulates, “generation service should be subject to market competition and minimal economic regulation.”

Biomass producers are asking for ratepayer support, but they have not yet shown any viable strategy to become competitive. This is the same circumstance that unfolded in Maine, where even after a $12 million subsidy, the plants remain closed, the jobs have been lost and the taxpayers are left on the hook. Why would we expect the situation in New Hampshire to be any different?

Given the fact that New Hampshire has the fourth-highest electricity rates in the country, it is imperative that we do everything we can reduce to that burden on our economy.

Some are worried about what these six small electricity generators going out of business would mean for workers. I share this concern that these jobs are important to the local economies; however, they do not provide a valid justification for another biomass subsidy. I believe that even with the subsidy, these electricity generators would still be unprofitable.

If these generators want to get out of the red, they need to redevelop their business plans rather than relying on another government subsidy. Working to compete in the market without government intervention is the most cost-effective way to save jobs while sparing electricity ratepayers from an unnecessary $90 million electricity bill increase.

Thank you, Gov. Sununu, for vetoing Senate Bill 365.