Lawmakers Sustain Biomass Subsidy Veto In 'Devastating' Blow to N.H. Timber Industry

Sep 18, 2019

New Hampshire state lawmakers have upheld the governor's veto of a plan to subsidize New Hampshire's small biomass power plants.

The proposal was attached to a bill that would have set up a study committee on microgrids.

It would have required utilities to add a small fee to customers’ bills. That fee would have subsidized six of the state’s wood-fired power plants for the next three years.

House legislators today fell five votes short of the two-thirds majority needed to override Gov. Chris Sununu's veto of the bill.

[Lawmakers Fail to Override Sununu Vetoes on Voting, Biomass Bills]

It's a disappointment for the forest products industry, which says it relies on biomass plants as a market for the low-grade wood they argue they need to harvest as part of healthy forestry.

Tree farmer Tom Thomson calls the governor's veto "devastating" to the state's forest lands and timber industry. 

"There is no way, without the biomass, that we can manage that sustainably," Thomson told NHPR after the vote. "So instead of growing trees, I will be growing house lots. And I will invite you up when I put the sign up."

Advocates said biomass and timber also create jobs and drive rural economies statewide.

“I think it’s good public policy to promote an energy source where the economic benefit for the state far outweighs the costs,” said Rep. Erin Hennessey, a Republican from Littleton, during the debate over the veto.

Some environmental groups oppose biomass and urged lawmakers to sustain the veto. They say biomass creates dangerous emissions and encourages the deforestation that contributes to the risks of climate change.

Republicans have also criticized the small fee the bill would add to customers’ electric bills.

"As we have stated repeatedly over the past three years, if New Hampshire legislators want to provide support for the forest products industry they should do so transparently through the general fund and not through the opacity of higher electricity rates," said Marc Brown, executive director of the conservative lobbying group New England Ratepayers Association, in a statement. 

Rep. Mike Harrington, a Republican from Strafford, made this economic argument against further subsidies for the plants during floor debate:

"They never have and never will run without a subsidy because they're just not economically efficient,” Harrington said.

[N.H. Veto Tracker: List of Bills Vetoed by Governor Sununu]

With subsidy plans in doubt, some plants and timber operations have gone idle in recent months.  

Last year, House lawmakers did pass a similar biomass subsidy plan – that time, overriding a veto by one vote.

But the law quickly stalled in a federal regulatory challenge. After months of delay, the case is slated for a hearing in Washington Thursday

The biomass plants have also asked the state Supreme Court to intervene in that dispute.

(This post was updated to correct that Rep. Hennessey is a Republican. This post has also been updated with more reaction from stakeholders.)