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    Sunday, May 05, 2024

    Committee approves Millstone bill, sends it on to legislature

    A man casts his line into the waters off the Pleasure Beach boat launch in Waterford with Millstone Nuclear Power Station in the distance. (Sean D. Elliot/The Day)
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    Hartford — With a 15-6 vote, members of the state Legislature’s Energy and Technology Committee on Tuesday advanced a bill giving Millstone Power Station the ability to sell its electricity directly to distribution companies through a state-run bid process, sending it first to the full Senate and then the House for consideration.

    “I’m not a nuclear lover, but the reality is Millstone provides 2,100 megawatts that we need,” said state Rep. Lonnie Reed, D-Branford, co-chairwoman of the committee. “Renewables aren’t yet ready to replace that amount of power.”

    The bill, SB 106, was crafted as a means of stabilizing the Waterford nuclear power plant, which provides more than half of the electricity used in the state, in the face of volatile energy markets that plant owner Dominion contends have been a major factor in shutdowns of other nuclear plants, and caused New York and other states to pay subsidies to keep plants there open.

    It also was written to establish the state on a path toward deriving 40 percent of its power from renewable energy sources including large hydroelectric, wind, solar, fuel cells, anaerobic digesters and biomass by 2040.

    “This is not an expansion of nuclear, but creates a bridge for renewables,” said state Sen. Paul Formica, R-East Lyme. “There are no subsidies in this bill, but rather it’s an RFP (request for proposals) opportunity that would only be accepted if it were in the best interests of the ratepayers.”

    State Rep. Holly Cheeseman, R-East Lyme, called the bill “a wonderful first step” toward ensuring that the state has reliable, affordable energy into the future.

    Under the bill, Dominion would be able to bid for a single five-year contract to sell up to 950 megawatts of Millstone’s power directly to Eversource and United Illuminating. Renewable sources could offer bids for 20-year contracts. The bid process would be run by the state Department of Energy and Environmental Protection and overseen by the state Consumer Counsel and Attorney General’s Office to ensure that ratepayers would benefit, noted Sen. Paul Doyle, D-Wethersfield.

    “Ratepayers would be a priority,” he said.

    Dominion currently sells its power to third-party hedge funds and Wall Street financial institutions, which in turn sell it to the wholesale market. Company officials contend they can increase profits and stabilize the plant by selling directly to distributors at prices higher than they sell to the third parties, but lower than distributors currently are paying. That savings, they say, would be passed on to electricity consumers.

    “If we can make money and provide lower rates, that’s good policy,” Kevin Hennessy, Dominion’s state policy director for New England, said after the vote. He added that the company would have preferred to be able to bid on contracts longer than five years, but remains hopeful that the provision would be renewed in the future.

    “It’s a little disappointing,” he said. “But we’ll have to earn it and prove ourselves.”

    In a statement, Hennessy said the bill would reduce the retail electricity process through an auction process that “will give Dominion and all other bidders a strong incentive to offer the lowest prices possible."

    “If Dominion comes in with the lowest bid and it is accepted, consumer prices will go down. If other suppliers outbid Dominion by offering lower prices, the result again will be lower prices for consumers,” he said.

    Supporters of the bill also promote it as critical to ensuring the state remains on track to achieving its goals for reducing greenhouse gas emissions from power generation. Nuclear power, while not a renewable source, produces power without the carbon dioxide emissions created by fossil fuel combustion.

    Several lawmakers who voted for the measure said they did so with some reservations, but are hopeful that changes will be made to the bill's language as it moves forward.

    Opponents, however, said the state needs to first complete a comprehensive energy strategy before changing the way power is allowed to be bought and sold in the state. They also said Dominion should be required to reveal its profits and losses for the plant before being allowed into the bid process.

    “All of this is based on the premise that Dominion’s losing too much money, but when we ask for disclosure, it’s not there,” said state Rep. Peter Tercyak, D-New Britain.

    In the days leading up to the vote, groups including AARP Connecticut, the Connecticut Public Interest Research Group, the Connecticut Citizen Action Group and the Connecticut Fund for the Environment urged the committee to reject the bill, questioning whether ratepayers actually will benefit and undercut the state’s move toward renewables.

    “This bill would boost profits for Dominion on the back of ratepayers, all the while propping up old dirty technologies and undercutting renewable energy,” said Kate Cohen, state director for ConnPIRG.

    Nancy Burton, director of the Connecticut Coalition Against Millstone, called the bill a “dirty backroom deal.”

    Competing power producers, including the Stop the Millstone Payout Coalition and the Connecticut Petroleum Council, released statements after the vote, urging legislators to oppose the bill when it advances to the state Senate and House of Representatives.

    “Today’s action is nothing less than corporate welfare that could raise costs for Connecticut consumers who already pay some of the highest electricity prices in the nation,” said Steven Guveyan, director of the petroleum council, which represents the oil and natural gas industry. “Moving forward, we urge every legislator in Connecticut’s General Assembly to reject this misguided legislation that could harm consumers and distort the energy markets.”

    SolarConnecticut, an association of solar industry businesses, also criticized the vote as favoring Millstone at the expense of solar energy. Michael Trahan, executive director of the association, noted that the bill provides for only a 12-month extension to the state’s commercial solar incentive program.

    “If the Millstone plant is thought to be deserving of a five-year financial cushion, then I sense most ratepayers would support the solar industry getting at least a similar investment,” Trahan said in a statement. “As it is, Millstone gets a five-year deal and in-state commercial solar gets 12 months. Millstone will be benefitting from this deal long after in-state solar incentives are phased out in Connecticut."

    j.benson@theday.com

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