PSNH Says New England's "Energy Crisis" Augurs Against Generation Divestiture

"New England is currently experiencing an energy crisis," Public Service of New Hampshire said in response to a PUC Staff report which examined the economic impact of divesting PSNH's generation plants

The report had been first reported by EnergyChoiceMatters.com yesterday (click here)

"Many customers paid a high price for energy purchased on the open market this winter, and next winter is expected to be even tougher," PSNH said.

"Given the looming retirement of several existing plants this year and in the near future, we can expect our region will continue to be severely challenged. Just this week (April 1), at a presentation to the FERC, an ISO New England official said he expects next winter to be more challenging than this one," PSNH said

"What we can all agree on is that the PSNH plants have historically provided benefit and value to our customers, and this past winter was no exception. Our generation units produced energy at a cost that was more than $115 million less than the market price of that same amount of power," PSNH said.

"Clearly, at a time when energy costs are increasing, PSNH-owned generation is creating huge value for NH ratepayers every day, and keeping our customers' rates stable. In fact, in recent months many customers have returned to PSNH for energy service," PSNH said.

"The staff's study is highly dependent on a number of issues that are uncertain and difficult to predict - the future price of gas, the retirement of other power plants, the construction of new gas and electric transmission infrastructure. These variables have a significant impact on the market value that a prospective buyer would be willing to pay for PSNH's generation fleet," PSNH said

"The study also highlights how divesture will result in major stranded cost charges for consumers – an important reminder for those who might suggest that the company's investments in these facilities would disappear with divestiture. We agree with the Staff that if a divestiture of PSNH's plant does occur, it will be necessary to review existing law to ensure that full recovery of any stranded costs is ensured through a non-bypassable customer charge," PSNH said