Lawmakers forge energy deal on power plant

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July 31, 2012

Lawmakers forge energy deal on power plant

By Jesse Roman Staff Writer The Gloucester Daily Times Tue Jul 31, 2012, 12:00 AM EDT

BOSTON — State lawmakers have hashed out a compromise on a controversial energy bill that would guarantee the full deconstruction and environmental cleanup of the Salem Harbor Station coal power plant by 2017.

In addition, the final language extends through 2019 millions in annual state aid to Salem to make up for lost property tax revenue with the closing of the power plant.

A conference committee unanimously approved the proposal, and the Senate is expected to vote on the measure this afternoon. The House could also take it up as early as today, and the governor is expected to sign it, with the legislative deadline looming at midnight tonight.

“I’m thrilled with the end result,” said Rep. John Keenan, a Salem Democrat, who authored the bill and co-chaired the conference committee that worked through the weekend to reach agreement with Gov. Deval Patrick’s administration. “The bottom line is the site will be cleaned up whether there is a power plant there or not.”

Keenan said he “fully expects” the energy bill to pass both chambers and be signed into law.

The key component for Salem is a full guarantee from the state to clean up the coal plant site. It calls for the creation of a task force “to ensure the full deconstruction, remediation and redevelopment or repowering of the Salem Harbor Power Station by December 31, 2016.”

The task force, consisting of 11 members and chaired by Richard Sullivan, the secretary of the Department of Energy and Environmental Affairs, would look into options for “the full financing” of deconstruction and cleanup of the plant, maintenance of jobs and tax revenue, and would work to ensure “the responsible parties are held liable for costs of environmental remediation.”

Gov. Deval Patrick would convene the task force by Sept. 15.

“This task force will ensure remediation by 2016, which was what the goal was from the very beginning,” Keenan said.

Footprint Power has a deal in place to purchase the Salem plant from Dominion Energy, with plans build a new natural-gas power plant on the site.

The deal is expected to be finalized within a month, but has drawn concern from a number of North Shore environmental groups. The coal-fired plant has also drawn questions over the years from residents in Manchester and in Magnolia over is emissions. .

The compromised language in the state bill is a far departure from what was initially proposed.

Under the much-maligned original proposal — Section 42 of a much larger energy bill — Footprint would have been responsible for the full cleanup of the plant site and given what some called a “sweetheart deal” in exchange for its cooperation. Energy distributors would have been required to enter into minimum 15-year contracts Footprint, essentially guaranteeing the new plant owners a level of profitability in exchange for the responsibility of cleaning up the site.

Consumer groups, environmentalists, the energy industry, the Senate president, Patrick and the Attorney General all spoke out against that proposal, saying the provision would throw the energy market out of whack and provide an unfair advantage to the new plant operators, resulting in higher power rates.

The new approach, however, appears to put the onus and responsibility of cleanup squarely on the state.

The latest version of the bill removes the guaranteed long-term contracts. Instead it requires generators to submit competitive bids to distributors for long-term contracts if it is found that the local energy grid needs additional power. All generators, including Footprint, would be able to submit competitive bids to distributors on a level playing field, Keenan said.

“No one can suggest that this is some kind of sweetheart deal,” he said.

Jesse Roman can be reached via email at jroman@gloucestertimes.com.