Ronald C. DeCurzio: Massachusetts municipal utilities doing their part to reach clean energy milestones
By Ronald C. DeCurzio, CEO of Massachusetts Municipal Wholesale Electric Company February 14, 2017
Ronald C. DeCurzio, CEO of Massachusetts Municipal Wholesale Electric Company
Massachusetts municipal utilities and their Ludlow-based joint action agency, Massachusetts Municipal Wholesale Electric Company, are playing a large role in helping the Bay State meet evolving energy and climate change goals.
Through innovative projects in municipal utility communities, public power utilities are leading the charge in integrating emerging technologies into the electric grid of the future. They do this while setting the standard for reliable, low-cost electric service for their customers.
The 40 municipal utilities in Massachusetts operate under a not-for-profit business model that features local control over decisions affecting electric service, rates and resource choices. In Western Massachusetts, the communities of Chicopee, Holyoke, South Hadley, Russell, Chester and Westfield are served by municipal utilities. They are among more than 2,000 public power utilities across the United States, serving more than 14 percent of all electric customers. Each one is community-owned and operated.
There are dramatic changes taking place in today's electric industry. Customers are changing the traditional dynamics of supply and demand, using solar, battery and other technologies to generate and store their own electricity. Gadgets abound that enable customers to control their electricity use.
In Massachusetts and other New England states, energy policy is shifting to require greater use of non-carbon, renewable energy resources. Such policies are intended to address climate change issues, but integrating large amounts of renewable energy into the existing power system is raising concern about the cost and reliability of electric service.
Guided by the decisions of municipal utility officials, who are either elected or appointed by elected municipal officials, Massachusetts municipal utilities are doing their part to help the state reach its clean energy milestones. The Massachusetts Municipal Wholesale Electric Co. members' power supply, which includes the resources of 20 municipal utilities in the state, already is nearly 50 percent carbon-free.
As compared to the region as a whole, the MMWEC-municipal power supply is about 40 percent cleaner than generating resources serving New England. These resources include various wind, hydro, solar and carbon-free nuclear power projects, including:
- Wind: The 20 MMWEC municipal utilities own 25 megawatts of wind generation, about a quarter of all wind generation in Massachusetts;
- Solar: Solar projects with a capacity of approximately 25 megawatts are located in MMWEC member service territories, with up to an additional 18 megawatts projected to come online in 2017;
- Energy Efficiency: MMWEC's two energy efficiency programs, for residential customers and commercial and industrial customers, have resulted in significant energy and cost savings. Since inception, the Home Energy Loss Prevention Services (HELPS) program and Green Opportunity (GO) program together have saved enough energy to power nearly 25,000 homes for a year; and
- Emerging Technologies-Distributed Generation: Through its Emerging Technologies Initiative, MMWEC is assisting its members with grant financing and other aspects of developing energy storage, energy efficient street lighting and other innovative technologies.
The city of Holyoke, due largely to innovative projects advanced by the MMWEC member Holyoke Gas & Electric Department, was recognized in 2016 with a climate protection award by the U.S. Conference of Mayors. Holyoke was singled out for its carbon-free energy portfolio, including ownership of the Holyoke dam and associated hydroelectric facilities.
The Chicopee Electric Light Department has 6.6 megawatts of solar power installed, with another 5 megawatts coming online in 2017.
And in South Hadley, the South Hadley Electric Light Department's power portfolio is nearly 90 percent carbon-free.
Other MMWEC members are integrating carbon-free projects as well. Last summer, the West Boylston Municipal Light Plant began construction on a 1.5-megawatt community solar project, built on the town's closed landfill. Customers have the option of subscribing to the project, allowing those with an interest in "going green" to participate, even if they can't install solar on their homes.
In nearby Sterling, the Sterling Municipal Light Department is constructing the first utility-scale energy storage project in Massachusetts. The 2-megawatt battery system helps boost reliability for utility customers. In 2014, Sterling was recognized by the Solar Electric Power Association for having the top new solar watts per customer in the nation.
Massachusetts municipal utilities were created around the turn of the 20th century, as municipal officials sought to gain control over the cost and quality of their electric service. MMWEC was formed in 1969 as the municipal utilities' joint action agency, providing services that enabled municipal utilities to develop an independent public power supply. By act of the state Legislature in 1975, MMWEC became a not-for-profit public corporation and political subdivision of the commonwealth, empowered to issue tax-exempt bonds to finance a broad range of energy resources.
Today, MMWEC provides its members with a variety of services, including power supply planning and management; resource development and financing; risk management; and wholesale power market representation. Using its tax-exempt financing authority, MMWEC has issued more than $4.7 billion in bonds to finance its approximate 750-megawatt ownership in various New England power plants, including its flagship Stony Brook power plant in Ludlow and the state's second largest wind farm on Brodie Mountain in Hancock. All but $56 million of the debt has been retired.
Reliable service and low rates are the hallmarks of municipal utilities. Nationally, customers of investor-owned utilities pay average electricity rates that are 13 percent higher than public power rates, according to the American Public Power Association. In addition, public power utilities are customer-focused, as customers have a direct voice in decisions made by their utility.
As we move forward into 2017, MMWEC and its member utilities will continue looking for ways to integrate clean energy projects and new technologies into their operations. This can be done without mandate, as we have demonstrated many times over, and while preserving the public power business model, which enables municipal utilities to set the standard for clean, cost effective, reliable electric service.
Ronald C. DeCurzio is the CEO of Massachusetts Municipal Wholesale Electric Co., based in Ludlow. To learn more about MMWEC, visit mmwec.org.