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Consumer-owned utility supporters launch ballot initiative over LD 1708 veto

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Though the legislature failed to override Gov. Janet Mills’ veto of a bill that would have created a consumer-owned utility and allowed it to take over Maine’s largest investor-owned utilities, the issue may be settled by voters in 2022.

Our Power, a non-profit organization that describes itself as a “group of Maine ratepayers, business leaders, energy experts, conservationists, and others committed to putting the Pine Tree State’s energy future in the hands of Mainers,” recently announced it has begun the citizen initiative process to bring their issue to the ballot box.

“Our Power is excited to launch a statewide citizen initiative campaign. 75% of registered Maine voters support replacing CMP and Versant with a local non-profit consumer-owned utility company, so we know the people are with us,” said Stephanie Clifford, communications director for Our Power, in a press release. 

Our Power filed two applications for citizen initiative petitions with the Office of the Secretary of State. If enacted, one of the petitions would ask voters to approve the creation of a consumer-owned utility company that would take over Maine’s existing electricity utilities. The other would create fitness-to-serve standards for Maine’s existing electric utilities and would replace them with a consumer-owned utility if they failed to meet those standards. 

If the legislature had overridden Mills’ veto of LD 1708, the bill would have put the question of whether a consumer-owned utility should take over Central Maine Power and Versant Power on the ballot in November of the year in which it was enacted.

LD 1708 created fitness-to-serve standards for Maine’s existing utility companies. The bill directed the Public Utilities Commission (PUC) to find a transmission and distribution utility with 50,000 or more customers unfit to serve if it had met at least two out of three standards of unfitness in the previous five years. It defined standards of unfitness as any utility that had a customer satisfaction rating that repeatedly fell into the lowest decile for utilities of a similar size in the country, had a reported reliability that repeatedly fell into the lowest decile for utilities of a similar size in the country, or had residential delivery rates that repeatedly were among the highest decile for utilities of a similar size in the country.

The fitness-to-serve standards created in Our Power’s citizen initiative petition are similar to those created by LD 1708. The petition directs the PUC to find a transmission and distribution utility unfit to serve if it meets four or more of the petition’s eight outlined standards.

Like LD 1708, these standards include falling into the lowest decile of customer satisfaction and reliability rates and highest decile of residential delivery rates. Our Power’s petition stipulates a utility is unfit if it has received those ratings for two or more of the past five years.

Our Power’s petition also defines a utility as unfit to serve if, within the past year, it has contracted with a business to perform work valued at more than $100,000 that could have been performed by employees of the utility. It also makes owning critical infrastructure vital to Maine’s welfare a standard of unfitness if a utility is 5 percent or more owned by a government that doesn’t represent its customers.

Other standards of unfitness outlined in Our Power’s petition application relate to a utility’s corporate structure. If customers pay for the cost of a utility’s corporate taxes or pay more than 10% of shareholder profits on investment in infrastructure, a utility is unfit to serve. If customers pay for 90% or more of damages to company assets caused by extreme weather events, a utility is considered unfit to serve and the PUC can deny it access to federal emergency management assistance.

Finally, the petition considers a utility unfit to serve if it is unable to place the needs of customers, workers, or the state’s climate and connectivity goals ahead of “the desires of shareholders to earn a profit.”

If these conditions are met, the petition would create the Pine Tree Power Company, a non-profit, customer-owned utility company that would “use its access to low-cost capital and its ability to purchase and manage the electric transmission and distribution system in a manner that is not focused on ensuring shareholder profits.” The language of Our Power’s citizen initiative application is identical to the language of LD 1708 in describing Pine Tree Power’s purpose.

Our Power’s other citizen initiative application also creates the Pine Tree Power Company. It outlines the company’s purpose, identical to the description in its first petition, and lays out the terms on which the company operates. Most of these terms are similar or identical to those in LD 1708.

LD 1708 created a governing board of 11 members, seven of whom would be elected, to manage Pine Tree Power. Our Power’s citizen initiative would create a 13 member board, seven of whom would be elected. The elected members would each represent 5 state Senate districts.

Pine Tree Power would be prohibited from owning or operating a generating source of electricity, or purchasing electric capacity or energy from a generating source, unless the commission approves such a move to maintain or improve system reliability. This provision is identical to LD 1708.

LD 1708 also required Pine Tree Power to use eminent domain to acquire all the state’s investor-owned utilities if it could not submit a purchase offer to those utilities that they found acceptable, or if an agreement could not be reached through an arbitration process. That process is identical to the one outlined in Our Power’s citizen initiative application.

Our Power’s application also requires that, as in LD 1708, Pine Tree Power retain employees of the utility it acquires if they are subject to collective bargaining agreements. The application also stipulates that Pine Tree Power would be exempt from property taxes but would be required to pay property taxes. The rates the company charged would have to be sufficient to pay its taxes.

LD 1708 also required Pine Tree Power’s board of governors to contract management of its acquired facilities to an operator or operations team familiar with running the facility.

Mills mentioned this provision when she vetoed the bill, stating it made it likely Pine Tree Power would contract with CMP and Versant to run the same facilities they had been forced to sell. 

Our Power’s application stipulates that Pine Tree Power would not be allowed to contract the management of facilities out to operators if they have been found unfit to serve within the past ten years.

In order for its petitions to appear on the ballot in November of 2022, Our Power will need to collect more than 60,000 signatures for each petition. Secretary of State Shenna Bellows’ office has not yet approved the group’s two petitions, which were submitted on August 16.

Maine’s citizen initiative process is outlined in the state’s constitution and requires that a voter submit a written application, containing the names, addresses and signatures of five additional registered Maine voters, to the Secretary of State. Among the signatures submitted on Our Power’s petitions were those of Sen. Richard Bennett (R-Oxford) and Rep. Nicole Grohoski (D-Ellsworth), both of whom co-sponsored LD 1708.

Bellows has 15 days to review the application and accept it, reject it, or propose revisions. If approved, the Elections Division provides an approved petition form, which can be circulated to collect signatures for up to 18 months after it was issued.

LD 1708 originally stipulated the following wording appear on the ballot:

“Do you favor the creation of the Pine Tree Power Company, a nonprofit, privately operated utility governed by a board elected by Maine voters, to replace Central Maine Power and Versant Power, without using tax dollars or state bonds, and to focus on delivering reliable, affordable electricity and meeting the State’s energy independence and Internet connectivity goals?”

Our Power lobbied for the passage of LD 1708. According to its lobbying disclosure report from June 2021, the group expended $543 lobbying legislative officials and received $4,500 to pay a monthly retainer for Andrew Blunt, its registered lobbyist. Its lobbying efforts were specifically limited to LD 1708.

After Mills vetoed the bill on July 13, Our Power urged the legislature to override the veto and announced its intention to ensure the issue appeared on a future ballot.

“We are disappointed, but more energized than ever. With three-quarters of Mainers supporting our proposal and volunteers contacting us daily, we are confident we can collect signatures and succeed at the ballot box,” Clifford said in a statement released following Mills’ veto.

According to the Maine Ethics Commission, Our Power was formed as a ballot question committee by the group Maine Power for Maine People in December 2020 to support putting a question about consumer-owned utilities on the ballot. Rep. Seth Berry (D-Bowdoinham), who sponsored LD 1708, and Grohoski, both appear on the group’s registration paperwork as fundraisers and decision-makers. 

According to Our Power’s July 2021 quarterly report, Berry has provided just over $600 worth of in-kind contributions to the group in the form of Facebook ad boosts.

The group has received just over $57,000 from individual contributors, and an additional $1,975 from individual contributors donating $50 or less, and currently has just over $11,000 in cash on hand.

About Katherine Revello

Katherine Revello is a reporter for The Maine Wire. She has degrees in journalism and political science from the University of Maine. Her writing has appeared in Reason, The Washington Examiner, and various other publications. Got news tips? Contact Katherine at krevello@mainepolicy.org.

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