Governor Carcieri Urges Public Utilities Commission to Mandate Renewable Energy Contracts for National Grid

08-14-2008

Governor Donald L. Carcieri today sent a letter to the members of the Public Utilities Commission (PUC) urging the Commission to mandate that National Grid enter into long-term energy contracts with renewable energy generators for the Company’s standard offer supply. The PUC has such authority under Title 39, which gives the Commission broad powers to guarantee that ratepayers’ costs are minimized.

In the letter, Governor Carcieri wrote, "I believe that besides being an environmentally responsible action, large-scale renewable energy can provide stable, cost-effective electric prices far into the future. However, to facilitate the construction of such projects, it is necessary that National Grid be compelled to enter into long-term contracts in order to provide lower cost financing for these projects, such as the wind farm I have proposed." National Grid, a regulated utility, is afforded justifiable compensation for its costs by virtue of that status. A cost-effectiveness test needs to be applied to assure that energy produced by these projects is competitively priced.

The Governor reinforced his reasons for vetoing the renewable energy bill passed by the House and Senate. "I was forced to veto the bill passed by the House and Senate because it was fatally flawed. Renewable energy projects guaranteed by our ratepayers should be located in Rhode Island and also be cost-effective, and should not allow National Grid to reap great monetary benefits without taking any risk."

“Considering the out-of-control nature of the energy markets, the stabilizing effects of cost-effective renewable energy, produced in Rhode Island, should be part of National Grid’s portfolio based on prudence,” added the Governor.