​Rubens: Crony Capitalism Acid Test for Your State Senator

Action item: Ask your state senator to vote No on SB128. Look up contact info here. Why? SB128 would permit the NH Public Utilities Commission to force ratepayers to bear some or all of the above market costs of the Eversource Northern Pass Transmission line through a still-secret Power Purchase Agreement.

This means that ratepayers would be denied the full benefits of today's robust competition among New England electricity generators.

Note the long history of arguments that legislature-imposed bailouts and crony capitalism of the type enabled by SB128 will "stabilize" Eversource (formerly PSNH) rates. Ratepayers have been stuck for years paying stranded costs for Seabrook and the now-worthless Merrimack Station coal plant.

New England already suffers the nation's highest transmission costs and most overbuilt transmission infrastructure. Transmission operators like Eversource have abused their transmission monopolies and extraordinarily high guaranteed returns to saddle ratepayers with construction cost overruns and overbuilding.

If you want lower electric rates, ask our NH DC delegation to force FERC (Federal Energy Regulatory Commission) to reduce Eversource's extraordinarily high regulated rate of return on its near-monopoly on New England electricity transmission. Regulatory theory applying to "natural monopolies" such as transmission is that investors get a guaranteed return and ratepayers get reasonable prices.

Specifically, ask our delegation to sponsor a bill requiring FERC to limit transmission returns to the "midpoint of the zone of reasonableness", which today would be about 9.75 percent, still thoroughly sufficient to attract investment. As a point of comparison, private investors today accept un-guaranteed returns of 5 to 6 percent on real estate backed by 20-year CVS strip mall leases.

Again, please phone your state senator and politely request a no vote on SB128.

Jim Rubens is a former Republican state Senator from Hanover.