Weekly Message
Governor Paul R. LePage

August 8, 2016

Radio Address: Bad decisions in
Augusta result in high electric
prices
August 8, 2016
Bad decision-making in energy policy is expensive. These bad decisions
show up on your electric bill, and they’ve been holding Maine back for 30
years.

 Hello, this is Governor Paul LePage.
In the 1970s, environmentalists, like NRCM, blocked the expansion of
hydropower, which had been vital to Maine’s economy and manufacturing
base.
Meanwhile, the Province of Quebec decided to pursue hydro
development. Quebec is now ready to be a huge exporter of electric power
to New England. We could benefit from their low rates.
The 1980s were really bad. The Legislature gave contracts to independent
generators at the equivalent of the future price of oil. They got the future
price of oil very wrong, and Mainers paid $2 billion in above-market
contracts. These are called “stranded costs.” We are still paying millions
for that decision.
In 1987, Maine rejected a long-term contract and transmission project
with Hydro Quebec in favor of higher-priced generators at home. But
Vermont moved forward with a hydroelectricity project with Quebec. This
hydro project is helping Vermont lower its high cost of electricity.
In the 1990s, Maine broke up the utilities and sold our hydroelectricity
assets to the highest bidder. Brookfield is now the largest owner of our
hydro dams, and they have made millions selling power back to the Maine
people—even though these projects were supposed to benefit the public.
The idea of this effort, called “restructuring,” was to create a marketbased system and avoid the mistakes of the 1980. Instead of allowing the
markets to work, lobbyists have created expensive renewable energy
credits, long-term contracts for wind and costly carve-outs for solar. The
entire model is broken.
The bad decisions continue today. In 2009, the Legislature created a
requirement to sign contracts for 10-cents a kilowatt—which was double
the market price—for community renewable projects. This is expected to
cost $300 million over the lifetime of the contracts.
Instead of admitting this pilot program was incredibly expensive and a
massive failure, the Legislature determined the State should try to get
even more above-market contracts. They expanded the program in 2015
over my veto.
Bad decisions are very expensive. Last month, rates increased between 7
and 20 percent for all electric customers, whether they were an elderly
couple or a company trying to put Mainers to work. “Stranded costs”
increased by 363 percent!
Poor decision-making by politicians in Augusta is increasing your electric
bill and making it harder for companies to compete in Maine. Our past is
full of bad decisions, but it does not have to be our future.
I favor all forms of energy, including natural gas, hydro, wind, solar and

 nuclear—but only at market rates. The Legislature must stop approving
long-term contracts that enrich lobbyists at the expense of Maine people
and Maine companies.
These bad decisions are costing Mainers money and jobs. It’s time to get
smart about energy policy.
Thank you for listening.
MP3 Audio