In its review of the Legislature’s agenda this year (Jan. 5), the Editorial Board missed one issue that could directly affect most Maine families and the state’s economic future.
The issue is whether Maine people should take over ownership of their electric operating systems from Central Maine Power’s Spanish owner and Emera Maine’s Canadian owner.
The Legislature is now considering L.D. 1646, which would turn their facilities over to the Maine Power Distribution Authority, a new consumer-owned utility.
Many Mainers have told legislators they believe the companies have failed to provide reliable service at the lowest possible price, the basic mission of an electric utility. The Press Herald has revealed the extent of CMP’s billing problems.
L.D. 1646, sponsored by Rep. Seth Berry, who chairs the Energy, Utilities and Technology Committee, is intended to let customers run their utility on a nonprofit basis and dedicated to reliable service. The bill would replace investor-owned utilities with a consumer-owned utility.
As measured by the frequency of power outages experienced each year, consumer-owned utilities provide more reliable service, according to the U.S. Energy Information Administration. Nebraska, the only state served entirely by consumer-owned utilities, is in the top five for the most reliable service, while Maine, dominated by the two investor-owned utilities, ranks last in reliability among the 50 states, the EIA reports.
Rate information from the American Public Power Association shows that consumer-owned utility rates are lower. That’s because they borrow the funds they need at far lower cost than investor-owned utilities, which must build in profits for their shareholders.
Maine has several consumer-owned utilities with thousands of customers. Public Utilities Commission files show they charge lower rates. Their operating data show higher reliability.
In response to Berry’s bill, the foreign-owned investor-owned utilities have attacked the consumer-owned utility approach. Instead of defending their poor service and high rates, they focus on false or misleading information about consumer-owned utilities. They promise to contest the transfer and fight it all the way to court.
The risk for the bill is that the CMP and Emera opposition could confuse matters and discourage legislators from passing the bill. The risk for customers if it does not pass is that nothing would change.
There is a way to act on the question and to reduce the ability of investor-owned utilities to confuse and kill the authority proposal while it is still in the Legislature.
Let Maine people decide.
The Legislature should put to Maine voters in November the question of creating a consumer-owned utility to purchase the transmission and distribution assets of CMP and Emera Maine. The presidential and other races ensure a large turnout.
CMP and Emera Maine would still have the political advantage of their deep pockets. But an open election with public debates would produce more fairness.
The voters would be asked to create the new authority and approve its acquisition of investor-owned utilities property. The vote would settle the major question, free from the risk of the proposal being derailed by misuse of the legislative process. The final terms of the deal, including compensation for the investor-owned utilities, would be left to the governor, the Legislature and the investor-owned utilities.
Voter approval would strengthen the Legislature’s ability to protect consumer interests. And the process would take advantage of the fact that consumer-owned utilities, if called upon to settle post-election issues, often respect the popular will.
The referendum bill should contain one provision emphasizing that the customers, not state government, will own and set policy for the professionally run authority. Adopting the direct-election method used by shareholders to elect corporate boards would let authority customers elect its board. The existing Maine consumer-owned utilities all have elected boards.
The referendum consumer-owned utilities also require that no public money would be used for the authority, which would follow the Maine Turnpike Authority model. The turnpike authority has never had a cent of state funding.
The foreign owners of CMP and Emera Maine have failed to provide reliable, low-cost service. If Maine people are sufficiently fed up, they have a way to fix their utility service and reduce its cost. Let them decide.
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