Southeastern Connecticut legislators stand behind Dominion’s latest efforts

Article as it appeared in The Day

Local legislators said Monday that they are supporting Dominion Energy‘s latest attempt to include a provision in a potential state budget agreement that would aid Millstone Power station in selling the electricity it produces directly to utility companies.

After legislation Dominion was seeking failed in the General Assembly in June, Dominion said it is aiming to have the same measure become part of a state budget proposal. The legislation had called for a study, which would be followed potentially by state action to allow a state-sponsored competitive bidding process for nuclear power, Dominion spokesman Ken Holt said by email. The state has granted this process to all resources except coal, oil and nuclear, he said. The Associated Press first reported the news.

Currently, Dominion sells Millstone’s power through contracts with hedge funds and Wall Street institutions. 

The Senate had passed the legislation in June, but the House did not act on it.  Dominion representatives are continuing to talk with legislators about the importance of the effort, Holt said.

“If the proposal doesn’t pass it will certainly impact our ongoing assessment of Millstone,” he said.

Meanwhile, Gov. Dannel P. Malloy issued an executive order last month for the state Department of Energy and Environmental Protection and the Public Utilities Regulatory Authority to complete a study of the economic viability of Millstone and present the report to himself and the General Assembly by Feb. 1, 2018.

The study will include an analysis of nuclear power, as well as other emissions-free energy sources, in enabling the state to meet its carbon and emissions targets “at the least cost and with the greatest net benefit to Connecticut ratepayers, while maintaining the reliability of Connecticut’s electric grid,” the order states. It also includes an analysis of the best mechanisms to do so, whether they would be compatible with competitive wholesale and retail electricity markets and how they would affect ratepayers.

“Given changes in the competitive energy marketplace, the closure of several nuclear plants around the country and the need to meet our carbon reduction targets, we must develop a full understanding of the economics of the Millstone facilities,” DEEP Commissioner Robert Klee said in an announcement Friday. “The goal of our study will be to assess market conditions around the Millstone generating units — and other zero-carbon generation facilities — in order to protect the best interests of electric ratepayers, maintain the reliability of the electric grid, promote fuel diversity and meet our climate change targets by continuing to take advantage of this zero-carbon form of power.”

In reaction to the news last month, Paul Koonce, the CEO of Dominion Energy Power Generation Group, said in a statement that he appreciated the governor’s efforts, but “the time for a study without action has passed.” He said Dominion would continue its “strategic assessment” of Millstone.

Legislators from the region said Monday that they will continue to support Dominion.

The state has entered a new fiscal year without a budget. Sen. Paul Formica, R-East Lyme, said that given this new budget process and the Senate being split between Democrats and Republicans and the House having a slight Democratic majority, it would be difficult to predict if the language will be included in the budget proposal.

“Certainly, there is a feeling that we need to get something done,” he said. He added that the proposal is related to the budget, because it will have an effect on energy markets, which in turn affects the state and all of its facilities.

He said Dominion is looking for answers after about two years of discussion.

“I’m going to push as hard as I can wherever I can and whenever I can to save Millstone’s position in the energy market and also the jobs they provide. I think this is the single most important issue Connecticut is facing,” said Formica, adding that the potential departure of Millstone would have a cascading effect on the state’s budget issues and take away half of the energy provided to the state.

Sen. Cathy Osten, D-Sprague, said she would continue her support.

“I have been supportive of Dominion, and I will continue to be supportive, should it make it into the budget package,” she said.

Rep. Holly Cheeseman, R-East Lyme, said that Millstone supplies 60 percent of the state’s electricity, so a premature closure of Millstone would put at risk the state’s supply of reliable, affordable electricity.

She pointed out that when Millstone’s Unit 2 went offline on Aug. 11, 2016, prices spiked that day to almost $2,700 per megawatt/hour, while typical prices are about $30 per MWh. She compared this jump in prices to paying $225 per gallon at the gas pump instead of $2.50.

“If you care about the environment, if you care about ratepayers, if you care about having a sound energy base, you have to care about letting Dominion bid for power,” she added.

In addition, a potential closure would not only lead to a loss of jobs at Millstone, but have a “spillover effect,” pointing out that Pfizer’s downsizing affected the housing market and schools.

The Stop the Millstone Payout coalition has criticized the legislative proposal and issued a statement in reaction to Malloy’s order last month.

“Governor Malloy made the right call today in seeking additional information from Millstone before any decision is made regarding financial support for the company, particularly when all the external evidence suggests the plant is profitable and is obligated to serve the energy markets until at least 2022,” spokesman Matt Fossen said at the time.

Cheeseman said she and Rep. Kathleen McCarty, who represents Waterford, have been reaching out to legislators to explain why the issue is not just important to southeastern Connecticut, which continues to lag economically behind the rest of the state, but to all of the state as well.