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CMP, a subsidiary of Spanish-owned Iberdrola USA, raised electric rates by 2.5% this month to pay for a $1.4 billion grid upgrade project

Three things in life are now certain: death, taxes, and increased costs for energy.

In mid-May, the Maine Public Utilities Commission approved CMP’s proposal for a $1.4 billion improvement project on the electric grid.

Called the Maine Power Reliability Program (MPRP), the project will “build a new 345,000-volt transmission line from Orrington to Eliot, doubling the capacity of the grid’s backbone. CMP contends the improvements, the first major upgrade since 1971, are needed to keep the power grid stable beyond 2012.” (Source: Bangor Daily News).

Just about a month later, on June 24, CMP announced their first rate hike, a 2.5% increase that raises the average rate of electricity from 6.39 cents per kilowatt hour to 6.54 cents per kilowatt hour.

According to PUC Chair Sharon Reishus, “Transmission rates will likely increase as we upgrade and build new transmission infrastructure to meet the region’s demand for reliable electricity.” (Source: PUC Statement)

How Far will Maine’s Rates Go Up?

Maine is part of a group called ISO New England, which means that Mainers are responsible for 8% of the price tag of the massive project (and consequently, we are also responsible for 8% of the cost of projects developed in New Hampshire, Massachusetts, Rhode Island and Connecticut). That leaves $120,000,000 to be picked up by Maine residents, or roughly $100 per person, for a project which smart-grid advocates had argued was unnecessary.

Indeed, even during this year’s hot, traveler-packed Fourth of July weekend, Maine’s peak energy use was no higher than it was four years ago.

An Alternative Vision

Germany Solar Power
GridSolar envisions a Maine that looks more like Germany – where solar panels are a common sight on homes, businesses, and open fields.

On the – ahem – sunny side, the MPRP includes several stipulations, one of which is to build two pilot utility-scale solar projects – one in Portland and another in Midcoast Maine. This effort will be lead by GridSolar.

GridSolar is a strong advocate of the smart grid and plans to demonstrate how small-scale solar generating plants can offset the need for massive transmission lines.

These pilot plants will be performing at their peak when extra electricity is most needed – during the hot, sunny days of the summer.

And since the power will be produced locally, it can be transmitted to energy consumers without the massive transmission lines needed by out of state, fossil-fuel burning facilities.

If you are irritated about rising energy costs but think that solar is still too expensive, read our follow-up post that demonstrates that solar is cheaper than grid electric, even at today’s prices!