COMMONWEALTH of MASSACHUSETTS DEPARTMENT of PUBLIC UTILITIES ) Petition of NSTAR Elec
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COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF PUBLIC UTILITIES __________________________________________ ) Petition of NSTAR Electric Company d/b/a ) Eversource Energy for Approval of Proposed ) D.P.U. 18-64 Long-Term Contracts for Clean Energy Projects ) Pursuant to Section 83D of An Act Relative to ) Green Communities, St. 2008, c. 169, as amended ) by St. 2016, c. 188, § 12 ) __________________________________________) __________________________________________ ) Petition of Massachusetts Electric Company and ) Nantucket Electric Company d/b/a National Grid ) for Approval of Proposed Long-Term ) D.P.U. 18-65 Contracts for Clean Energy Projects Pursuant to ) Section 83D of An Act Relative to Green ) Communities, St. 2008, c. 169, as amended by ) St. 2016, c. 188, § 12 ) __________________________________________) __________________________________________ ) Petition of Fitchburg Gas and Electric Light ) Company d/b/a Unitil for Approval of Proposed ) D.P.U. 18-66 Long-Term Contracts for Clean Energy Projects ) Pursuant to Section 83D of An Act Relative to ) Green Communities, St. 2008, c. 169, as amended ) by St. 2016, c. 188, § 12 ) __________________________________________) INITIAL BRIEF OF CONSERVATION LAW FOUNDATION Conservation Law Foundation (“CLF”) hereby submits its Initial Brief in support of the Petitions and the Contracts. RELEVANT FACTUAL AND PROCEDURAL BACKGROUND On July 23, 2018, NSTAR Electric Company d/b/a Eversource Energy (“Eversource”), Massachusetts Electric Company and Nantucket Electric Company d/b/a National Grid (“National Grid”), and Fitchburg Gas and Electric Light Company d/b/a Unitil (“Unitil”) (collectively, the electric “Distribution Companies”) each filed petitions with the Department of Public Utilities (“Department”) pursuant to Section 83D of An Act Relative to Green Communities, St. 2008, c. 169 (the Green Communities Act”), as amended by § 12 (“Section 83D ”) of the Energy Diversity Act of 2016, St. 2016, c. 188 (the “Energy Diversity Act”), and the Department’s regulations implementing Section 83D at 220 C.M.R. § 24.00 et seq. (the “Petitions”), for approval of long-term power purchase agreements with H.Q. Energy Services (U.S.) Inc. (“HQ”), an affiliate of Hydro Quebec, to acquire their pro rata share of an aggregate of 9,554,940 MWh of Qualified Clean Energy and associated Environmental Attributes from hydroelectric generation (the “PPAs”) to be delivered into New England over new transmission facilities, referred to as the NECEC Transmission Line, in accordance with a Transmission Service Agreement by and between each of the Distribution Companies and Central Maine Power Company (the “TSAs”) (together, the “Contracts”). The Petitions were jointly docketed as D.P.U. 18-64, 18-65, and 18-66 for Eversource, National Grid, and Unitil, respectively. On August 9, 2018, CLF filed petitions to intervene in each docket. CLF’s petitions were based on, among other things, its special expertise and experience: (i) in state and regional energy policy; (ii) in the assessment of various Massachusetts programs, policies, regulations and approvals regarding their ability to contribute to the greenhouse gas (“GHG”) emissions Page 1 of 12 reductions required by the Global Warming Solutions Act, Chapter 298 of the Acts of 2008 (the “GWSA”) and the Green Communities Act; and (iii) relating to its involvement in Kain vs. Dep’t of Envtl. Prot., 474 Mass. 278 (2016) and subsequent related proceedings. The Department granted CLF’s petition to intervene as a full party in D.P.U. 18-64, 18-65, and 18-66 on August 27, 2018. ARGUMENT I. THE DEPARTMENT SHOULD APPROVE THE CONTRACTS BECAUSE THEY WILL REDUCE GHG EMISSIONS AS REQUIRED BY THE GWSA Subject to an adjustment to Distribution Company remuneration that the Department determines to be in the public interest, the Department should grant the Petitions and approve the Contracts because the Contracts fulfill the fundamental purpose of the Section 83D procurement: they will directly assist the Commonwealth in meeting GHG emissions reductions mandated by the GWSA. Record evidence conclusively demonstrates that over their 20 year term, the Contracts will reduce the Commonwealth’s statewide GHG emissions dramatically, by approximately 36 million metric tons of carbon dioxide (“MMTCO2e”). A. The Fundamental Purpose of the Section 83D Procurement Is to Reduce Statewide GHG Emissions in the Electricity Sector. Since at least 2010, the Commonwealth has identified the need for, and its intent to procure, a large volume of imported clean electricity as part of a coordinated, multi-sector strategy to meet near and long-term emissions reduction mandates set by, and pursuant to, the GWSA.1 In 2016, the Commonwealth enacted Section 83D primarily to address that need and 1 See Exec. Office of Energy and Energy and Envtl. Affairs, Massachusetts Clean Energy and Climate Plan for 2020 (Dec. 29, 2010), at 45-46 (recommending clean energy imports over a new, purpose-built 1,200MW transmission line from Canada into southern New England), available at https://www.greenneedham.org/blog/wp- content/uploads/2011/02/2020-clean-energy-plan.pdf; Exec. Office of Energy and Energy and Envtl. Affairs, 2015 Update - Massachusetts Clean Energy and Climate Plan for 2020 (Dec. 31, 2015) (“2015 CECP Update”), at 11 (suggesting “a particular focus” on clean energy imports “is appropriate given the mount of reductions anticipated from this policy), 15 (identifying additional clean energy imports beyond 2020 as “important for achieving the Page 2 of 12 fulfil that intent, that is, for the purpose of permanently reducing GHG emissions in the electricity sector in order to achieve emissions reductions mandates set by, and pursuant to, the GWSA.2 That core aim for the procurement was plainly expressed in the Request for Proposals (the “Section 83D RFP”) pursuant to which the Contracts were initially submitted for consideration: The Energy Diversity Act, which includes Section 83D and 83C procurements, recognizes the necessity of the Commonwealth to achieving the goals established pursuant to the GWSA. The GWSA requires the Commonwealth to establish goals and meet targets for the reduction of greenhouse gas emissions by 2020, 2030, 2040, and 2050. The goals established by the Commonwealth specifically require a reduction of 25 percent below 1990 levels by 2020 and a reduction of 80 percent below 1990 levels by 2050. The requirements to competitively solicit and contract for Clean Energy Generation – firm service hydroelectric generation, offshore wind generation, and new Class I RPS eligible resources both firmed up with firm service hydroelectric generation or standalone– are intended to maximize the Commonwealth’s ability to achieve GWSA goals.3 In order to ensure proposals, including the Contracts, would fulfil that core aim of the Section 83D procurement, the RFP reflected express statutory language by requiring that all projects must demonstrate the use of “an appropriate tracking system to ensure a unit specific accounting of the delivery of clean energy” expressly “to enable the Department of Environmental Protection, in consultation with the DOER, to accurately measure progress in achieving the [GWSA’s] 2050 emissions limit), 32 (identifying the then-proposed Section 83D enabling legislation as an electric sector emissions reduction policy), available at https://www.mass.gov/files/documents/2017/12/06/Clean%20Energy%20and%20Climate% 20Plan%20for%202020.pdf. 2 See Joint Press Release by Gov. Charlie Baker, Sec’y of Energy and Envtl. Affairs Matthew Beaton, Senate Pres. Stan Rosenberg, House Speaker Robert DeLeo, and DOER Comm’r Judith Judson (Aug. 8, 2016), available at: https://www.mass.gov/news/governor-baker-signs-comprehensive-energy-diversity-legislation (presenting the Energy Diversity Act as evidence of bi-partisan support for “strengthening the state’s clean energy economy and progressing towards Massachusetts’ greenhouse gas reduction requirements,” as “progress in achieving the emissions reductions targets set forth by the Global Warming Solutions Act,” and as a “recommit[ment] . to meeting our Global Warming Solutions Act requirements”). 3 Ex. JU-2 (“Request for Proposals for Long-Term Contracts for Clean Energy Projects”) at 8; accord id. (“The fundamental purpose of the RFP is to satisfy the policy directives encompassed within Section 83D and to assist the Commonwealth with meeting its Global Warming Solution Act (‘GWSA’) goals.”); accord id. at 7 (“encouraging “proposals which include Clean Energy Generation able to commit to begin deliveries prior to the end of 2020 to maximize the Commonwealth’s ability to meet its [GWSA] goals.”). Page 3 of 12 Commonwealth’s goals under Chapter 298 of the Acts of 2008 or Chapter 21N of the General Laws.”4 B. The Contracts Will Dramatically Reduce Statewide GHG Emissions from the Electricity Sector. Record evidence is susceptible to only one reasonable conclusion regarding the GHG impact of the Contracts: Over their 20 year term, they will substantially and without question reduce the Commonwealth’s statewide GHG emissions, as measured by the Department of Environmental Protection’s GHG Inventory (the “MassDEP GHG Inventory”) in accordance with the GWSA. 1. The GWSA Requires Sustained and Dramatic Decreases in GHG Emissions in the Electric Sector Through 2050. As the Section 83D RFP recognized,5 the GWSA established a comprehensive, legally enforceable framework requiring the Commonwealth to permanently reduce its GHG emissions by at least eighty percent below 1990 levels by 2050. G.L. c. 21N, § 3(b); Kain v. Dep’t of Envtl. Prot., 474 Mass. 278, 282 (2016) (“Kain”); New England Power Generators Ass’n, Inc. v. Dep’t of Envtl. Prot., 480 Mass. 398, 400 (2018) (“NEPGA”). In the electricity sector, then, the Commonwealth must reduce annual GHG emissions from approximately 28.2 MMTCO2e in 1990 to a level at or below 5.6 MMTCO2e in 2050.6 And such reductions must be “actual, measurable, and permanent.” Kain, 474 Mass. at 300. 2. Compliance with GWSA Emissions Reductions Mandates Is Properly Measured Only By the MassDEP GHG Inventory. In order to achieve its emissions reduction goal, the GWSA expressly defined the 4 Id.