Summary
Eversource Energy (ES) filed an 8-K on August 17, 2016, to report a significant decision by the Massachusetts Supreme Judicial Court. The court vacated an order from the Massachusetts Department of Public Utilities (DPU) that would have allowed electric distribution companies, including Eversource, to enter into customer-backed, long-term contracts for natural gas capacity. This decision directly impacts the proposed Access Northeast Project, a joint venture with Spectra Energy Corp and National Grid plc, which was designed to increase natural gas supply for electricity generation and potentially lower energy costs for New England consumers.
Key Highlights
- 1Massachusetts Supreme Judicial Court vacated a DPU order related to natural gas capacity contracts.
- 2The court's decision prevents the approval of customer-backed, long-term contracts for natural gas capacity.
- 3The Access Northeast Project, a joint venture involving Eversource, Spectra, and National Grid, is directly affected by this ruling.
- 4Eversource expressed concern that the decision leaves the region vulnerable to insufficient gas capacity during cold winters, potentially leading to higher electricity prices.
- 5The company stated that the Access Northeast Project was projected to save New Englanders approximately $1 billion annually and reduce regional emissions.
- 6Eversource plans to re-evaluate its path forward and continue working with New England states on necessary infrastructure.
Frequently Asked Questions
The Massachusetts Supreme Judicial Court vacated an order by the Massachusetts Department of Public Utilities (DPU). This DPU order would have authorized electric distribution companies to review and approve customer-backed, long-term contracts for natural gas capacity, which was crucial for projects like Access Northeast.
The decision is a significant setback for the Access Northeast Project, as it prevents the DPU from approving the long-term, customer-backed contracts that were intended to secure the project's financing and operation. This makes the future of the project uncertain.
Eversource is concerned that the ruling leaves New England without sufficient natural gas capacity for electricity generation during peak winter demand. This could lead to increased electricity prices for customers and potential reliability issues.
While the court decision is a setback, Eversource stated its commitment to re-evaluating its path forward and working with New England states to ensure the region has the necessary infrastructure for reliable and lower-cost electricity. The immediate next steps for the project are still under evaluation.