Energy committee split three ways on accountability legislation

Last week, the Legislature’s Energy, Utilities, and Technology (EUT) committee held work sessions and language reviews on what is arguably its biggest piece of legislation this session, LD 1959, An Act To Ensure Transmission and Distribution Utility Accountability. This bill had a daylong public hearing in February, which generated enormous amounts of testimony. The work session to follow was just as lengthy, taking a full day to find an outcome that would garner the support of most of the committee. However, that did not happen, and the EUT committee will now submit three different reports on LD 1959.

Three Committee Reports…
We will try to briefly explain each report. However, there are numerous moving parts to each that make them difficult to summarize. We encourage members who are looking to learn more about them to reach out using the contact information at the end of this article. The different reports are as follows:

• Report A: Ought to Pass as Amended was signed by Senate Chair Mark Lawrence, Sen. Eloise Vitelli, Rep. Melanie Sachs, Rep. Scott Cuddy, and Rep. Paige Zeigler.
• Report B: Ought to Pass as Amended was signed by House Chair Seth Berry, Rep. Nathan Carlow, Rep. Nicole Grohoski, and Rep. Chris Kessler.
• Report C: Ought to Pass as Amended was signed by Sen. Trey Stewart, Rep. Steven Foster, Rep. Chad Grignon, and Rep. Nate Wadsworth.

 
As drafted, LD 1959 would require quarterly report cards that grade a utility’s ability to meet minimum standards for customer service, complaints, reliability, and power restoration. It would allow the PUC to consider imposing a fine of $1 million or 10 percent of annual revenue if the utility failed to meet minimum standards for two consecutive quarters. Continued failure could trigger a forced sale to another power company or a consumer-owned utility. Report A looks to build off LD 1959 as drafted and submitted to the Legislature by Governor Janet Mills and Senator Stacy Brenner.
 
The amended version supported in Report A removes the requirement for considering a consumer-owned utility. It requires the PUC to impose a fine of $1 million if failed for two consecutive quarters and adds a new section to the bill requiring the PUC to implement integrated grid planning to assist in the transition to a clean, affordable, and reliable electric grid in a cost-effective manner. The PUC is required to develop plans that include forecasts of projected load, baseline energy supply data and assessment, hosting capacity analysis and an assessment of the “environmental, equity and environmental justice impacts of integrated distribution plans.” The Brenner amendment focused on three areas: strengthening performance metrics for utilities, eliminating divestiture language, and adding a new section on integrated grid planning. 
 
Report B is also based off LD 1959 as drafted. This report was led by an amendment presented to the committee by Rep. Seth Berry. It changes the considerations for the PUC when it examines divesting an underperforming utility. It requires the PUC to consider whether divestiture will result in net benefits to ratepayers and if it will result in greater local control of the utility’s management. This proposal added a new section to the bill that would allow investor-owned utilities to be franchised. Under the measure, franchises would expire every 20 years, and the PUC would determine whether to renew them by following the bill’s procedures for divestiture. There were also several technical changes that were made in this report – adding language to the service standards mentioned earlier and requiring the PUC to audit the data that the utilities will be reporting.
 
The third report, Report C, was led by Republican Sen. Trey Stewart, who at a high level wanted to see changes around cost impact. His amendment included language directing the PUC to consider the impacts of its rules while setting performance metrics for utilities. Report C also removes language around grid planning, which was added to both Report A and B but was not in LD 1959 as drafted.
 
There was language in LD 1959 as drafted regarding grid planning that did not seem to have any opposition from committee members. However, between the time of the public hearing and the work session, more complex language was added to Reports A and B, and it appears this has added some more concerns around the bill.
 
The Maine State Chamber testified “neither for nor against” at the public hearing on this legislation. To summarize, we want to make sure that the metrics being used for service quality are objective and not subjective. We also feel that there should be a longer timeframe before a potential fine from the PUC. Two quarters is not a long enough period to be graded, especially in a climate like Maine’s. We would like to see a longer period, or a rolling average during a 12-month to 18-month span.
 
Lastly, forcing a company to be sold raises a concern for the entire business community. Standards triggering what would cause an adjudicatory proceeding from the PUC need to be more precise. Right now, the language is vague, and we have asked the committee to carefully consider these guidelines. Maine’s electrical infrastructure is critical to Maine businesses. Our businesses rely on transmission utilities every single day to bring electricity to their business so they can operate successfully. We recognize this is targeting two specific Maine companies, but in the future, it could be another Maine business – which is why we would also highlight our concerns with the idea that the sale of an asset be conducted through the PUC, with no plan for shareholder compensation. It is just and fair that, if the state is forcing a business to be sold, the business should be the one conducting the sale – not state government, or in this case, the PUC.
 
As LD 1959 continues through the legislative process, the Maine State Chamber stands willing to work with all interested parties to find a solution that better addresses the variety of remaining concerns. We feel there might be a path forward as Report A and Report C seem to make improvements to the bill. However, without these concerns addressed, we welcome an opportunity to be involved in the discussion to pass legislation that is workable and manageable for all parties.
 
For additional information or questions, please contact Ben Lucas, government relations specialist, by calling (207) 623-4568, ext. 111, or by emailing [email protected].