Sharing New Hampshire’s Big Backyard

For an East Coast state, New Hampshire has a fair amount of open space. There would seem to be plenty of room to accommodate a relatively clean way to meet the region’s energy needs.

But many Granite Staters think of the forested, mountainous northern woods as their backyard, so I suppose the usual cries of NIMBY were inevitable.

Hydro-Quebec, the Canadian company that is the world’s largest producer of hydroelectric energy, wants to export more power to the Northeastern states. In 2010, it established a joint venture with Public Service of New Hampshire, the aim of which was to build a 180-odd mile power line from the border into the southern part of the state, where it will tie into the regional electric grid. The project is called Northern Pass. Most of the power the line would carry would ultimately be consumed in other New England states to the south, though some of it would be available in New Hampshire.

The controversy in New Hampshire over Northern Pass is intense. As with the Keystone XL oil pipeline, a presidential permit is required for the cross-border project to move forward. In order to try and secure the permit, Northern Pass’ backers made changes to their proposed route earlier this year, burying a couple of small segments and rerouting parts of the line – partly to make it less visible, but also in response to a new law that makes it impractical to obtain rights of way via eminent domain in New Hampshire. The line will now have to be built on land bought or leased by the utilities, along existing power line rights of way, or along other public rights of way such as highways.

The line as proposed would cross a largely rural and sparsely populated part of the state. Critics say it would cross the “protected” White Mountains National Forest, but in fact, the proposed line does not cross any legally designated wilderness or other wildlands. National forests are managed for multiple uses, including timber harvesting and other commercial development. While the project runs through areas that are subjectively “scenic,” that is not the same as protected. Some opponents want the entire line to be buried, which is economically impractical. Others just don’t want it built at all.

Some of the objections are to further hydropower development in Quebec’s nearly uninhabited north. Such development can certainly have significant environmental impact. However this, like the Canadian oil sands development, is a matter for Canadians to manage. The country certainly does not lack a well-developed conservation lobby that will make its positions clear. But Canada’s economy is also built heavily on resource extraction, so “just say no” is not as powerful an argument up there as down here.

Some Northern Pass opponents criticize the perceived lack of benefit directly to New Hampshire, since the power would likely go mainly elsewhere, at least at first. This position seems to rest on the assumption that the state is somehow divorced from its regional electric grid or the New England economy as a whole.

And some objections are to the assumed greenhouse gas emissions of vegetation that would decompose under the hypothetical Quebec reservoirs built to furnish power for export. As is often the case with environmental advocacy, these objections fail to consider the other side of the equation.

Hydropower itself generates no significant carbon emissions once reservoirs are up and running. Hydropower consumed in the Northeast would largely displace power which would have otherwise been generated from natural gas, which releases some carbon; oil, which releases more; or coal (from out-of-region producers), which releases the most of all. Over the long term, more hydropower means less carbon emission.

Hydropower would also drive another nail into the coffin of the viability of New England’s aging nuclear power plants, for which this country still has no long-term waste disposal solution. This is a cost which is mostly omitted from the price of the nuclear power we consume today.

The objections to Northern Pass, taken collectively, mostly boil down to good old-fashioned not-in-my-backyard syndrome. My guess is that the Obama administration will happily delay a decision as long as possible, maybe long enough to dump the problem into the lap of the next president. After all, President Obama has yet to work up the gumption to finally make a call on Keystone XL.

Canadian hydropower is one of the best long-term solutions for supplying energy to the Northeast, where the current, overpriced power options are a major impediment to the region’s economic growth. (I like to call it the “Con Ed tax,” in honor of New York City’s wildly expensive hometown utility, but the problem exists at varying levels region-wide.) We can meet the Northeast’s power needs in ways other than with Canadian hydropower, of course. But doing so will require burning a lot of that newly cheap and available gas from hydraulic fracturing, better known as fracking, in the nation’s shale reserves. That would be OK with me, but I think economists and environmentalists could actually agree that a more diversified, less gas-dependent energy portfolio would be better for the region and everyone in it.

Northern Pass or something very much like it would be a welcome addition to the energy options available to the Northeast. Here’s hoping there is enough of that old Live-Free-or-Die spirit left in New Hampshire to let the project move forward on its planned configuration of privately owned land and public corridors already set aside for transportation purposes. New Hampshire’s spacious backyard can easily accommodate clean power along with clean living.

About Larry M. Elkin 553 Articles

Affiliation: Palisades Hudson Financial Group

Larry M. Elkin, CPA, CFP®, has provided personal financial and tax counseling to a sophisticated client base since 1986. After six years with Arthur Andersen, where he was a senior manager for personal financial planning and family wealth planning, he founded his own firm in Hastings on Hudson, New York in 1992. That firm grew steadily and became the Palisades Hudson organization, which moved to Scarsdale, New York in 2002. The firm expanded to Fort Lauderdale, Florida, in 2005, and to Atlanta, Georgia, in 2008.

Larry received his B.A. in journalism from the University of Montana in 1978, and his M.B.A. in accounting from New York University in 1986. Larry was a reporter and editor for The Associated Press from 1978 to 1986. He covered government, business and legal affairs for the wire service, with assignments in Helena, Montana; Albany, New York; Washington, D.C.; and New York City’s federal courts in Brooklyn and Manhattan.

Larry established the organization’s investment advisory business, which now manages more than $800 million, in 1997. As president of Palisades Hudson, Larry maintains individual professional relationships with many of the firm’s clients, who reside in more than 25 states from Maine to California as well as in several foreign countries. He is the author of Financial Self-Defense for Unmarried Couples (Currency Doubleday, 1995), which was the first comprehensive financial planning guide for unmarried couples. He also is the editor and publisher of Sentinel, a quarterly newsletter on personal financial planning.

Larry has written many Sentinel articles, including several that anticipated future events. In “The Economic Case Against Tobacco Stocks” (February 1995), he forecast that litigation losses would eventually undermine cigarette manufacturers’ financial position. He concluded in “Is This the Beginning Of The End?” (May 1998) that there was a better-than-even chance that estate taxes would be repealed by 2010, three years before Congress enacted legislation to repeal the tax in 2010. In “IRS Takes A Shot At Split-Dollar Life” (June 1996), Larry predicted that the IRS would be able to treat split dollar arrangements as below-market loans, which came to pass with new rules issued by the Service in 2001 and 2002.

More recently, Larry has addressed the causes and consequences of the “Panic of 2008″ in his Sentinel articles. In “Have We Learned Our Lending Lesson At Last” (October 2007) and “Mortgage Lending Lessons Remain Unlearned” (October 2008), Larry questioned whether or not America has learned any lessons from the savings and loan crisis of the 1980s. In addition, he offered some practical changes that should have been made to amend the situation. In “Take Advantage Of The Panic Of 2008” (January 2009), Larry offered ways to capitalize on the wealth of opportunity that the panic presented.

Larry served as president of the Estate Planning Council of New York City, Inc., in 2005-2006. In 2009 the Council presented Larry with its first-ever Lifetime Achievement Award, citing his service to the organization and “his tireless efforts in promoting our industry by word and by personal example as a consummate estate planning professional.” He is regularly interviewed by national and regional publications, and has made nearly 100 radio and television appearances.

Visit: Palisades Hudson

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