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The Mass. Electricity Market and Why We Support Hydropower

Posted by Katie Hauser on May 02, 2016

Businesses depend on different amounts of electricity but they are all subject to rates that are set by a combination of market dynamics and public policy choices. The rates for electricity in Massachusetts are among the highest in the nation, which has a significant impact on businesses and residents.

As part of our approach to taking positions on energy issues, we conducted extensive research on energy costs and supply as well as the solutions being offered in Massachusetts, which we brought together in a policy brief titled, The Current Balance: The Role of Cost, Reliability, and Environmental Impact in the Massachusetts Electricity Market.

Based on our analysis of the data, the Chamber supports proposals that encourage the procurement of hydroelectricity in the Commonwealth. However, we have two reservations with specific components of legislation that is currently under consideration.

  • First, the Chamber cautions against legislating a set amount of electricity to be procured from a specific source. We would encourage the Legislature to allow for a competitive procurement process that does not require a minimum amount from a specified energy source.
  • Second, the Chamber is concerned with the lack of clarity regarding what constitutes “cost effectiveness” for ratepayers, and would encourage the Legislature to provide measurable parameters that define this term.

To make Massachusetts more competitive, we must create and implement updated energy policies that strike the right balance between cost, reliability, and environmental impact. Achieving a balance will require that we look at how we integrate natural gas, solar, hydropower, and other sources, to create a more cost-effective, reliable, and environmentally sound energy future for Massachusetts.

Click here to read our policy brief.

James E. Rooney is President and CEO of the Greater Boston Chamber of Commerce. Follow him on Twitter.