Massachusetts ends deal with Northern Pass hydro project

Massachusetts abandoned plans Wednesday to get its clean energy from a $1.6 billion hydropower project, dealing a blow to a proposal that has sparked controversy in New Hampshire over plans to deliver the power through nearly 200 miles of transmission lines across the state.

The Massachusetts Office of Energy and Environmental Affairs said it would reverse course and terminate the earlier selection of Eversource's Northern Pass project. The state will instead move toward an agreement with New England Clean Energy Connect, a hydropower project proposed by Central Maine Power Co. Both projects would get their hydropower from Canada.

Peter Lorenz, the office's communication director, said the decision continues Republican Gov. Charlie Baker's administration's "commitment to execute clean energy procurements that ensure the Commonwealth is positioned to achieve a clean, affordable, and resilient energy future while progressing towards greenhouse gas reduction requirements."

Lorenz didn't detail why Northern Pass was dropped, although there were concerns about the viability of the project after New Hampshire regulators rejected it in February. Concerns were raised about negative impacts on the tourism industry and local businesses.

Eversource requested a rehearing but the New Hampshire Site Evaluation Committee said that would not start until at least May. That's well past the deadline set by Massachusetts for moving forward with a large-scale clean energy project mandated under a 2016 law.

Despite the setback, Eversource said it will carry on with Northern Pass and argued in a statement that it was "the best project for the region and New Hampshire, and we intend to pursue all options for making it a reality."

It didn't say whether it has contracted with anyone else to buy the project's power.

James Torgerson, chief executive of Avangrid, the parent company of Central Maine Power, said he was grateful that Baker and his administration had chosen its project. The $950 million project will provide Massachusetts with power for 20 years and Torgerson said it "will continue to deliver benefits for New England consumers for decades beyond."

"Our applications for state and federal permits continue to move forward with the strong support of communities and stakeholders in Maine," added Doug Herling, president and chief executive officer of Central Maine Power. He said the company believes its New England Clean Energy Connect project "is a cost-effective response to Massachusetts' needs."

Meanwhile, Eversource has stepped up its campaign to promote the project after the regulatory rejection.

Last month, it gathered mayors, union officials and business owners who supported the project and promoted what it said was $300 million in reductions to low-income and business customers in the state from it.

It also announced that it would allocate $95 million from a previously announced $200 million community fund — $25 million to compensate for declining property values, $25 million for economic development and $25 million to promote tourism in affected areas. Another $20 million would fund energy efficiency programs.

It didn't, however, offer to change the route of the project or bury more of its transmission lines — a key demand from opponents.

"At a time when the region needs new and diverse sources of clean energy, it is vitally important that projects like Northern Pass are considered fully and efficiently and without unnecessary delay," the company said.

The Massachusetts decision emboldened environmentalists and scores of local officials in the northern part of the state who said it's time to move on from the project. They complained that Northern Pass and its transmission line towers would destroy scenic views, reduce property values and hurt tourism in a part of the state that includes the White Mountain National Forest. They also argue it offers few benefits to New Hampshire.

"Massachusetts came to the only logical conclusion, that Northern Pass won't be built through New Hampshire, and isn't an option going forward. The extension cord is now unplugged," said Jack Savage, a spokesman for the Society for the Protection of New Hampshire Forests, which opposes Northern Pass. "The likelihood of Northern Pass as proposed finding a path forward in New Hampshire is slim to none."