Along with sleet and freezing rain, Maine got hit this week with an unusual effect of the storm: greed. In the end, it could hurt worse than the nasty weather.
The state’s power crisis has brought out the best in neighbors. Too bad Illinois and New Jersey are not neighbors. That’s where the owners of a badly needed power plant in Jonesboro live, no doubt comfy with the thought that they could gouge Maine when it was down.
The wood-fired plant in Jonesboro, owned by Indeck Energy Services of Buffalo Grove, Ill., and Ridgewood Power Corp. of Ridgewood, N.J., has been used sporatically for several years because the plant costs too much to operate. Bangor Hydro Electric wanted to bring the plant back on-line after the ice storm Thursday took out 8 miles of its main transmission line to the region. Bangor Hydro thought it had a month-long agreement Saturday at a price slightly higher than the spot-market price but justified because of the cost of restarting the plant.
Over the weekend, apparently, Indeck heard not sleet but opportunity knocking. It took a look at the weather reports, saw the tough shape Maine was in, saw how hard everyone was working statewide to help people in need, and knowing Maine had few options for getting power Down East, did the only thing its greedy little heart could manage. It decided Monday, 30 minutes before it was scheduled to go on-line, that it wanted to renegotiate — pushing the the total cost of the agreement to 22 cents per kilowatt hour. That’s higher than the worst contract a utility ever signed during the height of the oil crisis of the 1970s and ’80s. It would have pushed up added costs up for Bangor Hydro ratepayers from $300,000 to almost $2 million.
Bangor Hydro’s president, Bob Briggs, properly and politely, replied, Get stuffed.
By Tuesday morning, Hydro workers had put together an alternative that returned power to much of the Down East region. It deserves megawatts of credit for not caving at a difficult time and finding a way around the problem. The event, however, should also alert ratepayers to some of the dangers of the coming free market for electric power. Bangor Hydro did its job by negotiating with a potential power source apparently intent on making money in a hurry at the expense of local ratepayers. But who is going to negotiate for customers after March 2000, when Maine’s utilities are whittled down to wires companies?
By then, the utilities will have sold off all of their own generating capacity, by legislative order, and will be known as transmission and distribution companies. The new owners of the power stations in Maine will be national megacorporations, such as FPL Group, which set a record last week in spending $846 million to buy most of Central Maine Power’s plants. In an open market, the out-of-state companies will charge what the market will bear. And it’s amazing how much people are willing to spend when they’re shivering in the dark.
Bangor Hydro has taken its complaint against Indeck to the Attorney General’s Office. AG Andrew Ketterer can decide whether the power-plant owners have broken any laws. But Mainers already know that any company that tries to get rich during a crisis has broken, at the very least, the unwritten laws of community, and they will keep a closer watch on the utility changes that are coming.