The House, Thursday, October 26, 2023

Rep. NoelThank you, Mister Speaker. I come before you today to oppose the veto of HB 142, relative to the operation of the Burgess Biopower. Burgess Biopower has been operating in my hometown since 2013 and has been a terrific corporate citizen of Berlin. It is New Hampshire's only remaining biomass plant providing renewable baseload power to Eversource under a 20-year power purchase agreement. Should this veto stand, the plant will close. Hundreds of people could lose their jobs and New Hampshire's forests products industry will be dealt a severe blow and what will then be known as an unforced error on the part of this legislature. To read the Governor's veto message, you would think we were dealing with a business that no one would miss, one that was poorly run, one that costs more than what it's worth. Knowing the plant as I do, I still cannot understand the impetus for this wrongheaded thinking. It could not be further from the truth. The Governor says New Hampshire ratepayers have been taken for $200 million in subsidies for the Burgess Biomass plant. The fact is that Burgess Biopower's power purchase agreement with Eversource specifies what each megawatt hour of power is worth and that is all they have received in their 10 years under this agreement. The New Hampshire Department of Energy completed an audit of Burgess last year after we passed SB 271 in which they confirmed that no money beyond what is allowed in the power purchase agreement was paid to Burgess by ratepayers. Note, however, that Biomass is a renewable energy source, so Burgess is eligible for renewable energy credits, which are turned over to Eversource per New Hampshire law and renewable energy credits do not count as subsidies. The Governor goes on to say the power purchase agreement is an example of what can go wrong when government is exploited by opportunists in the private sector. The Governor is asking us to blame an award-winning state of the art powerplant who came to us for help and which both the House and Senate agreed that such help was appropriate, indeed necessary. In this case, the problem with the power purchase agreement came from the New Hampshire Public Utilities Commission, not the private sector. New Hampshire Public Utilities Commission imposed a condition on the deal that forced Burgess to carry the difference between any lower price in the day ahead energy market and the agreed upon contract price in the power purchase agreement as an obligation on the company's books. This imposition of a paper debt burden to the plant's cost structure changed the deal markedly. This paper debt is not an operating cost of the plant, but a calculation that carried on the books but with an obligation to pay if the amount exceeds a fixed cap. HB 142, as written and approved by us this Spring, excuses the accrued excess amount, the paper debt that Burgess Biopower will shortly be obliged to pay. The Governor goes on to blame Burgess Biopower for taking too long to find a long-term solution, but the long time that has elapsed has been mostly on us. Burgess first came to us in 2017 when we passed SB 577. Burgess could see that the accumulating obligation on their books was a compounding problem that they could not fix without renegotiating the contract or obtaining a waiver of the power purchase agreement with lawmakers to eliminate the paper debt. There is no truth to any rumor that the debt is a result of how the plant is run or that it has not operated to its fullest capability. To date Eversource has not been willing to come back to the table to negotiate any change of the power purchase agreement. Whether Burgess continues in operation with all the benefits of locally sourced renewable electric power and the jobs that it brings to the New Hampshire economy now falls to us here today for us to decide. In 2018, we suspended the paper debt for three years to provide time to find a way forward and we should have provided relief from the accumulating obligation then, but we did not. So, in 2021 we passed SB 271 to forgive the accumulating paper debt altogether, but a house amendment modified that bill and delayed forgiveness again until the New Hampshire Department of Energy could complete an audit of Burgess's books. The results of the audit were received in December 2022, and they concluded that the plant's finances were in fact as presented by Burgess and that the plant has been operated to the highest professional industry standards. With these results in hand, HB 142 was filed to finally give the plant the solution it had originally sought. We voted 269 to 109 in favor of that relief this past Spring and the Senate vote that followed was unanimous declaring that passing this bill was the right thing for New Hampshire. Then came the veto which brings us to where we are today. I'll cut my remarks short here to allow my fellow representative from Berlin to carry on but let me make one comment before I step away from the well. Burgess Biopower is good for the economy. Burgess Biopower is good for Berlin and the North country and Burgess Biopower is good for New Hampshire. Thank you.

Rep. Eamon Kelley (D - Coos 7)Thank you, Mister Speaker. As my colleague alluded to in the Governor's veto message, he blames Burgess Biopower for taking too long to find a long-term solution, but finding a solution has always been the responsibility of this legislature. The reason it may seem that we have been asked to vote on this so many times because we, the legislature, have continued to kick the can down the road. Each time we have voted for a suspension, it has delayed repayment but not accrual of the CRF. Last year when this legislature voted to suspend the repayment for a fifth year, we did so with the understanding that it would give the Department of Energy time to complete a full financial audit of this facility. The agreement was that once we had that audit in hand, we would return with that long term solution. The audit which was exhaustive confirmed that the Biomass plant is one of the best in the country and now we are back to give the Governor the long-term solution he has been asking for. As this bill was so expertly amended by the Chair of the House Science and Technology Committee, it only resets the clock. It returns us to that $100 million cap on the CRF and puts the responsibility squarely on Burgess for any future accruals. Today we vote on whether Burgess will continue to operate November 1st, when the current suspension expires. A lot has been made about the benefit of the plant on the forest products industry, but the benefits extend to every corner of this state. The mom-and-pop gas stations that provide fuel and food to the hundred plus truckers who deliver chips to the plant every day. The family farms in all ten counties of this state who receive low price fertilizer made from the nutrient rich fly ash that comes exclusively from this plant. The machinists, the electricians, the pipefitters, none of whom are directly employed by Burgess but can rely on the plant for regular business. Let there be no mistake, if we do not vote to override the veto today, the result will be devastating for all of Coos County and others across this entire state. Please join me in voting Yea to overturn this veto. Thank you.

Rep. Michael Harrington (R - Straf 18)Thank you, Mister Speaker. This is kind of like d�j� vu all over again. Here we are back again with the third in a never-ending series of bailout bills for the Burgess Biomass Plant. No one is going to stand here and say it's not a well-run, efficient plant, a well-run plant. It's not very efficient because the thermal efficiency of the plant is about 18%, less than half of an oil or coal or nuclear plant, less than a third of a combined cycle gas plant. It's just not an efficient way to make electricity. Let's go back in history just a little bit to see what happened and how we got here. The plant was proposed back in the 2010- 2012 region, and it had to go in front of the site evaluation committee to get a permit. I was on that committee at the time. One of the things, obviously, a plant has to do is raise capital. Now because of the federal laws and under the Biden administration, Burgess was able to get their production tax credits paid up front. They were able to roll those up and get paid in advance and use it towards capital cost and they were also eligible for what's called a new market tax credit. These amounted to tens of millions from the taxpayers that went to Burgess in the form of those breaks. That still was not enough because these plants are very expensive to build. So, they had to get a purchase power agreement. Without that they could not get the capital to build their plant. They pursued, actively pursued the purchase power agreement with Eversource and they came to an agreement with Eversource. This agreement went to the PUC, the PUC then modified it to put in to what I refer to as a safety valve. Basically, it said we can pay you the terms of the contract, but if the amount being paid continues to go overmarket rate to the point where it comes over $100 million that the ratepayers subsidize Burgess for, then Burgess will have to start paying back the money. That is simply where we are at. We passed two bailout bills in the past to put that off. We keep delaying it, like they said kick the can down the road, and now they want to change the contract completely. It's simple. Live up the contract that you signed. No one forced them to sign the contract. If you sign a contract for buying a house because you think the value of the house is going to go up over a period of time and you take out a loan and the value doesn't go up, you just can't go back to the bank and say well I'm only going to make half my mortgage payments because the house didn't go up in value like I expected it was. That's what they are trying to do here. Another misrepresentation that is often given is that somehow this is so important to the electric grid in New Hampshire. Burgess accounts for about .2% of the capacity in New England. That's .2%. It's about 75 megawatts. To put that into perspective with what's going on in the region, next Spring ISO New England is going to allow 1400 megawatts at the Mystic facility to go out permanently. They are going to go away permanently. It's 1400 megawatts versus 75. So, you look around and say who is supporting this and who isn't. Well, I can tell you that the Business and Industry Association is opposed to it. The environmental groups like the Sierra Club is one of them is not supporting it. Don Kreis, the consumer advocate for the State of New Hampshire is not supporting it. They all want the veto to be upheld. So, let's just look at what's going on right now. Right now, assuming that the Burgess Bioplant is running, they are going to get paid ratepayer subsidies of about $4,000 an hour as we sit here so just put that out there. We are here for a couple of hours and that's $8,000 in two hours and that's because the way the contract works. Eversource is required to pay them in the range of $90 a megawatt hour for every megawatt they produce and then Eversource immediately sells that power into the daily markets, but the daily market price right now is about $30. So, the difference is made up by that ratepayer subsidy. When the cap that was in the contract that they agreed to and signed was reached, which was the $100 million, they were supposed to start paying that back and now they want to say no, we want to be forgiven that. We don't want to have to pay that back, but we'll go back to the terms of the contract once you wipe out our debt and it will continue to build up. But do you know what's going to happen next year, two years from now? They will be right back here again because they will still not be able to pay it back because they will still be getting massive subsidies and just running up the bill again. This does nothing but delay the inevitable. This plant may be well run and everything else, but it's just not an efficient way to make electricity and they are going to continue to run up that bill and the ratepayers are going to be responsible. So, nothing is going to change here. All we are doing is saying live up to the terms of the contract that you aggressively pursued and signed. Another little fact that I think most people don't realize is that this is only Eversource customers that are paying the subsidy. If this plant is so wonderful and so important to the state, then maybe we should pass a tax that would be more equitable way and then everybody in the state pay it. But if you're a Liberty, Unitil or Co-op customer. Even if you are a Co-op customer who lives in the North country who makes their living off of selling products to Berlin Biomass, you don't pay a dime in subsidies, but a retired school teacher living in Manchester on a fixed income pays a higher electric bill to support this. So, I guess it comes down to this. You think the government should be picking winners and losers and decide which companies will be successful because of subsidies or do you think people should be free to make the choice of what type of electricity they want to buy. Please vote to uphold the veto.

Rep. Corinne Cascadden (D - Coos 5)Thank you, Mister Speaker. I have notes so I can give you the facts. The Burgess Biomass plant has produced power for New Hampshire consistently and reliably to the terms of the purchase power agreement for ten years now or midpoint. During that ten-year period, Burgess has contributed $700 million to New Hampshire's economy. We made the right decision this Winter when we overwhelmingly passed HB 142. There has been a lot of misinformation about the management of this plant recently, yet there is no credible evidence that this is anything but a best-in-class management team. Burgess achieves availability and credibility percentages of over 90% when the industry average is 58%. They are a major partner in the forest product industry, and they support good jobs in the industry. Their impact on the North country economy is huge and their presence is felt throughout the region and throughout the state. Locally, Burgess pays 16% of Berlin's property taxes, provides 40% of the Berlin waterworks revenue. It will raise local and county taxes in North country communities, particularly Coos, if we let this veto stand. More fact, true facts. Burgess buys $800,000 low grade wood per year from 154 communities in all ten counties of New Hampshire. The facility uses 1/3 of all the wood cut in New Hampshire's $1.4 billion of forest products industry while providing steady well-paying jobs to 29 plant employees and supporting 240 jobs statewide. So, Burgess, by itself, injects nearly $70 million into New Hampshire's economy each year. The economics of managing our timberlands will be upended if we allow this plant to close. We stand to lose these and many more economic benefits if we allow Burgess to cease operating. To lose our one remaining biomass plant, particularly a plant that is among the top three, top three, most efficient and well-run biomass facilities in the country would be a real failure by this legislature. That failure would be a caving into politics at a time when our fellow citizens look to us for help with New Hampshire's economy. In hearings, our constituents have asked us to save New Hampshire's forest economy and to also help continue to City of Berlin's economic recovery from previous mill shutdown. Overturning this veto is the right decision to deliver economic benefits for the North country and for the entire state. I am a Berlin native. I have a 40+ career in the entire northern region. I experienced the demise of the pulp and paper industry. My family owned a business that serviced the logging industry and I have been on the personal and professional downside of the city's declining economy. When the legislature voted overwhelmingly in favor of 142 this spring, we got it right. The reasons this bill passed originally are just as valid now as they were a few months ago. Let's show the people who elected us our foresters, our landowners, our fellow citizens that we can do the right thing for New Hampshire and overturn the Governor's veto of HB 142. Thank you.

Speaker PackardThe state constitution requires a roll call. A two-thirds vote is required to override a veto. This will be a roll call vote. Members take your seats. The House will be in order. This is a roll call vote. The Chair recognizes Rep. Summers for a parliamentary inquiry.

Rep. James Summers (R - Rock 20)Thank you, Mister Speaker. Mister Speaker, if I know that the Burgess Biomass Plant to date has already received over $200 million in bailouts. And if I know HB 142 is for all intents and purposes, a bailout of upwards of $70 million or more. And if I know that in two years a request for another $70 million plus bailout will be made. And if I know the $70 million every two years is quite expensive for 30+ employees. And if I know the states like Massachusetts and Massachusetts current law and environmental groups no longer view burning biomass as renewable energy. And if I generally believe just like Wall Street banks, no one is too big or too small to fail, then I would push the red button to concur with the Governor's veto? Thank you, Mister Speaker.

Speaker PackardThe Chair recognizes Rep. McGhee for a parliamentary inquiry.

Rep. Kat McGhee (D - Hills 35)Thank you, Mister Speaker. If I know that letting this veto stand forces a huge unjustified tax increase on the people of the North country and brings job losses and uncertainty. And if I know that this plant receives no other ratepayer money than what appears in the signed contract it entered into in 2013 and that renewable energy credits do not count as subsidies because they belong to the energy taker which in this case is Eversource and not the plant, the producer. And if I know that Burgess Biomass is the last in state plant buying New Hampshire's essential timber products and that upending the timberland economics chokes local economies, shrinks our energy independence and leaves New Hampshire more vulnerable to forest fires. And, finally, if I know the North country is saying enough is enough, they came to us for help, and we gave it to them by a veto proof vote. And they are still counting on us to see it through their eyes, then would I now press the green button to put an end to this out of step veto? Thank you.

Speaker PackardThis is a roll call vote. If you are in favor of having the bill become law, you will press the green button. If you are opposed and wish to sustain the Governor's veto, you will press the red button. Voting stations are open for 30 seconds. Have all members present had an opportunity to vote? The House will attend to the state of the vote. 194 voting Yea and 159 voting Nay, it fails to reach the two-thirds. The Governor's veto is sustained. GOVERNOR'S VETO MESSAGE ON HB 337-FN By the authority vested in me, pursuant to part II, Article 44 of the New Hampshire Constitution, on August 8, 2023, I have vetoed House Bill 337, relative to directing the Office of Professional Licensure and Certification to provide notice of public meetings and an opportunity for comment from the public and creating a new attorney II position. This bill creates different standards for the boards administratively attached to the Office of Professional Licensure and Certification (OPLC) than other public bodies subject to RSA 91-A. Currently, public bodies are required to post a public notice 24 hours in advance and records become available for public inspection after the completion of the meeting. This bill would require OPLC to notice meetings 14 days in advance and provide materials pertaining to those meetings seven days prior to the meeting. This bill would essentially require a legal review for every document this would need to be released in advance. While I believe more transparency is important in state government, House Bill 337 would be unreasonable and burdensome for OPLC to implement, especially while the office is still working on implementing the major legislative achievements we've passed this session. Additionally, there is no justification for singling out OPLC and holding them to a different standard than every other public entity in New Hampshire. This bill would open the door for carve-outs for other state agencies, eroding the uniformity among state and local governments that follow RSA 91-A. For the reasons stated above, I have vetoed House Bill 337. Respectfully submitted, Christopher T. Sununu, Governor The question being, notwithstanding the Governor's veto, shall HB 337-FN, relative to directing the office of professional licensure and certification to provide notice of public meetings and an opportunity for comment from the public, and creating a new attorney II position, become law? Rep. Carol McGuire spoke in favor. Pursuant to the New Hampshire Constitution, Part II, Article 44, a roll call, requiring a two-thirds vote of the House for approval, was taken. YEAS 251 - NAYS 104 Bean, Harry Comtois, Barbara YEAS - 251 McCarter, Nikki St. Clair, Charlie Terry, Paul