Mass. may fork over millions in ‘mitigation’ payment

Edward N. Krapels | Oct 28, 2017

Article Originally Appears in CommonWealth, October 28, 2017

THE BIDS ARE IN: Developers of transmission for hydroelectric energy from Canada, wind from Maine, and solar power from all over New England sharpened their pencils, negotiated with property owners, conducted environmental assessments, and lobbied political leaders for years in anticipation of Massachusetts’ biggest renewable energy RFP. When the cost of energy and the transmission to bring it into the market are added up, the contract ultimately awarded will entail billions of dollars of payments by the electricity consumers of Massachusetts.

The question no one is asking, however, is how much of that total is going to our neighboring states in the form of “mitigation” – generous payments sent to host communities. These tolls are getting so expensive that they beg the question of whether we should pay the tolls or develop our own renewables off the coast of the Commonwealth.

Eight transmission projects submitted bids, and several of the developers of power from the north have showered especially lucrative commitments for benefits on towns, states, and environmental entities:  Eversource’s Northern Pass, and Blackstone’s New England Clean Power Link will offer a cocktail of wind and hydro (or hydro only, if the buyers prefer) from Quebec via New Hampshire (Northern Pass) and Vermont (Power Link).

In the absence of eminent domain — not available for these projects because they are not essential for electric reliability — it may be necessary to offer mitigation payments to localities, states, well-placed environmental groups, and private landowners over or under whose property easements are required. These payments are the straw that stirs the drink of any infrastructure project, whether they’re highways or skyscrapers or water mains. Mind you, the mitigation payments are on top of the usual costs of the infrastructure, including property taxes and state income taxes.