Misguided rate hikes ignore Maine ratepayers and clean energy developers

When it comes to utility costs, Mainers are not resting on their laurels.

This week, the Maine Public Utilities Commission announced new rate increases to subsidize Governor Janet Mills’ green energy transition. The new rates will mean customers pay an extra $15.50 each month to keep their lights on. The rate increases come at a worse time for Maine ratepayers, as many Mainers are already stocking up on heating oil for the winter (which remains priced at $3.00 to $4.90 per gallon) and interest rates are at their highest in a decade.

Maine’s climate action plan, “Maine Will Not Wait,” allocates billions of dollars for initiatives such as clean transportation, clean energy, climate resilience, and the development of “climate-friendly building materials.” This latest rate increase will go directly to pay $179.3 million owed to solar developers, a 47% increase from last year.

While companies like Central Maine Power blame the rate increases on market volatility, the primary cause of these price hikes is the Governor’s requirement that utilities purchase power from solar projects at a fixed rate. The MPUC blamed the 2022 rate increases on volatility in the fossil fuel market, despite the administration’s price-fixing policy now in its second year under a Democratic-majority administration. More importantly, energy developers, manufacturers, renewable energy companies and the Maine Renewable Energy Association all oppose the rate hikes, telling regulators they are unfair to ratepayers.

To meet Governor Mills’ carbon neutrality goal by 2045, energy companies would need to target 91% of greenhouse gas emissions from energy consumption in Maine, meaning Mainers would pay more for basic household functions like staying cool in the summer and warm in the winter. A similar climate action plan to attract more clean energy jobs by developing offshore wind alongside inefficient solar power, despite opposition from the state’s famous lobster industry, shows that ratepayers will be the ones hurting the most from these policies. It’s telling that only government agencies like the Office of the Public Advocate and the Maine Efficiency Trust are in support of this week’s rate hikes, with the latter existing to “reduce the cost and environmental impact of energy in Maine.”

Maine needs a cheap, reliable source of energy instead of subsidizing solar power and passing the huge costs on to ratepayers. U.S. emissions peaked at 6 billion tons of CO2 nearly two decades ago. Emissions from the residential and commercial sectors are lower than those from the electricity, transportation and industrial sectors.

But Maine, which ranks in the bottom 10 states in the U.S. for population and population density, is pushing the financial costs of its climate plan onto its residents’ utility bills. Maine’s contribution to overall U.S. emissions is tiny at best. It is simply a mistake to expect Mainers to believe that going carbon neutral will end destructive storms and save the planet.

Maine could go carbon neutral tomorrow and it would have no effect on global climate change. Charging Maine taxpayers higher fees to meet climate targets would not prevent bigger storms from hitting Maine. A higher cost of living would simply encourage young Mainers to leave the state in search of more affordable housing and better job opportunities.

The fact that clean energy companies are opposed to rate increases that would cover their costs is a sign that this rate hike is wrong: If basic utility rates continue to substantially increase the cost of living, ratepayers will begin to look for cheaper housing, hurting Maine and its clean energy development.

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