Zero Carbon

The Staggering
Costs of
New England’s
Green Energy
Policies
Isaac Orr, Mitch Rolling, and Trevor Lewis
Always On Energy Research
The Staggering Costs of New England’s Green Energy Policies
Isaac Orr, Mitch Rolling, and Trevor Lewis
Always On Energy Research
September 2024 Authors’ Note: This report is a continuation of the work performed
by authors at Always On Energy Research (AOER) modeling the cost of energy port-
folios in states throughout the country. Portions of this report have been repurposed
and modified to reflect the result of state Decarbonization Plans in the Independent
System Operator of New England.
4
Executive Summary......................................................................................................................................6
Introduction........................................................................................................................................................8
Policy Recommendations..........................................................................................................................9
Section I: New England State Policies............................................................................................. 11

Connecticut............................................................................................................................................................................. 11
Maine........................................................................................................................................................................................... 11
Massachusetts.......................................................................................................................................................................12
New Hampshire.................................................................................................................................................................... 13
Rhode Island........................................................................................................................................................................... 13
Vermont.................................................................................................................................................................................... 14
Vehicle Electrification Policies..................................................................................................................................... 14
Are The New England Decarbonization Plans Realistic?.............................................................................. 15
Section II: Impacts of Decarbonization Policies on ISO-NE

Electricity Production...............................................................................................17
Section III: Energy Demand.......................................................................................21
Section IV: Calculating the Cost of the New England Decarbonization Plans... 24
Residential Customers.....................................................................................................................................................25
Commercial Customers...................................................................................................................................................26
Industrial Customers.........................................................................................................................................................26
Section V: How Offshore Wind, Onshore Wind, Solar, and Battery

Storage Facilities Drive up Costs Compared to Reliable Power Plants...............31
Increasing Electricity Generation Capacity.......................................................................................................... 31
Transmission Costs............................................................................................................................................................38
Generator Profits.................................................................................................................................................................39
Additional Property, State, and Federal Taxes................................................................................................... 40
Summary of Costs............................................................................................................................................................. 40
What’s the Cost to ISO-NE if New Hampshire Pursues Net Zero?......................................................... 41
Section VI: The Levelized Cost of Energy for Different

Generating Resources..............................................................................................45
Section VII: Implications for Reliability..................................................................49

The Reliability of the New England Decarbonization Plans with 2019 Weather.............................52
Import Uncertainty.............................................................................................................................................................52
Section VIII: Emissions Reductions......................................................................... 55
Section IX: ESG’s impact on New England utility bills

and pension funds...................................................................................................... 58
ESG Encouraging Premature Regional Hydrogen Rollout.......................................................................... 59
State and Local ESG Policy Impact on Pension Funds.................................................................................. 64
ESG Metrics and Fossil Fuel Divestment Policies............................................................................................ 65
ESG’s Impact on Pension Fund Energy Investment Strategy.....................................................................67
Impact on Maine’s Pension Fund:............................................................................................................................... 72
Conclusion.................................................................................................................. 75
5
Executive Summary
T he six New England states (Connecticut, Maine, Massachusetts, New

Hampshire, Rhode Island and Vermont) are anticipating seismic
changes to their electricity generating system in the coming decades. All
but New Hampshire have committed to reducing their carbon dioxide
emissions by at least 80% by 2050 (Net Zero policies), prompting ongoing
changes in the grid’s resource mix and the increased electrification of the
heating and transportation sectors.1,2
If these Decarbonization Plans are realized, New England will go from
generating about 6% of its electricity from renewable energy (solar, wind
and batteries) in 2023 to generating 71% in 2050.
Our analysis anticipates that New England’s demand for electricity
is expected to increase 106% by 2050, driven by the home heating and
transportation sectors. The growth of electricity demand in the winter will
be particularly pronounced, causing New England’s peak electricity usage
to change from a summer peaking system in 2023 to the winter by 2035.
ISO-NE (New England’s regional electricity transmission organiza-
tion, which schedules electricity supply so that it meets demand) estimates
that 97 GW of new utility-grade renewables will be needed to “decarbon-
ize” the grid by 2050, an exponential increase over the currently installed
4 GW. However, to meet forecasted demand for electricity 24/7/365, we
calculate that 225 GW of new renewables would be needed if the wind
and solar energy output for 2050 follows the patterns of 2023 output. The
most economically efficient mix of renewable buildout would require over
6,600 offshore wind turbines, over 5,600 onshore wind turbines, and over
129 million solar panels. The solar panels alone would cover over 200
square miles.3
Building out “only” 97 GW of renewables puts the grid at risk for
extraordinarily long blackouts, of around 18 hours long.
But choosing the more reliable 225 GW option is likely to be cost
prohibitive. Our analysis found that this resource mix would cost New
England ratepayers $815 billion through 2050, excluding the impact
of federal subsidies. This is approximately a little more than half of the
region’s entire economic output in a single year.4 Ratepayers can expect a
corresponding doubling (above inflation) increase in the price of electricity
by 2050 versus 2023 prices. This means the average residential ratepayer
can expect to see their electricity prices increase nearly $99 each year.
Meanwhile, the average commercial and industrial ratepayers can expect
price increases of $489 and $5,280, respectively.
Despite this massive investment, even 225 GW of new renewables will
6
likely not be enough to fully meet electricity demand by 2050, especially in

light of 2023 wind and solar output patterns. (During some weekly stretch-
es in 2019, solar and wind power was lower than in 2023.) In which case,
our resource adequacy analysis shows that the 225 GW will prove inade-
quate for meeting the hourly electricity demand data, based on ISO-NE
projections for 2050 demand. A capacity shortfall for the region is likely to
result in rolling blackouts during the winter months. This is not to suggest
that New England will be spared blackouts until 2050. Shorter blackouts
may occur in the meantime.
The return benefits for Net Zero are miniscule. Even the ‘Social Cost
of Carbon’ figure taken from the Biden Administration shows that the
anticipated global benefits for these Net Zero policies fall well short of
spiraling costs to New England.
To make matters worse, many states and utility companies are con-
sidering new Environmental, Social, and Governance (ESG) proposals.
Anticipating this, the region’s companies are exploring the introduction of
gaseous hydrogen into pipelines, which could increase the cost of natural
gas heating by up to $1,588 a year for every New England ratepayer by
2050. For households already dealing with electricity price increases, this
will prove a significant hardship.
ESG policies are also reducing the potential investment returns for
public pension funds, which are struggling to reach full funding. The Paris
Climate Accords, closely associated with ESG policies, are being priori-
tized over the retirements of thousands of New England state employees
and teachers. Maine, Vermont and Rhode Island already have some form
of ESG pension legislation on their books, forcing pension investors to
bypass the most promising pension investments and divest from others.
Nearly a dozen bills have been introduced in Massachusetts and Con-
necticut with a similar goal in mind.
Net Zero and ESG policies will end up restricting economic growth
by refusing businesses and households the most efficient means of meeting
their energy needs. Resources that could have gone toward innovation
and production will be diverted toward meeting mandates that have few
tangible benefits. Worst of all, rolling blackouts will leave New England’s
most vulnerable populations dependent on a finicky electric grid to sur-
vive. Respiratory problems, kidney disease and deaths tend to spike during
blackouts, as the hospital instruments needed to keep sickly people alive
power down.5
These policies, when fully explored, cannot be rationalized. If New
England’s net-zero policies are fully enacted, the region is likely to see
a mass exodus of businesses and workers to other regions of the United
States. There is still time to alter course, to demand that the skyrocketing
7
costs for such draconian policies be counted alongside their (meager) ben-
efits. By doing so, we can return New England to the days when it success-
fully balanced environmental conservation and economic productivity.
Introduction
T he Economic Planning for the Clean Energy Transition report released by

ISO-New England (ISO-NE) in August of 2024 estimated a “vast
renewable build-out” of 97 GW of new onshore wind, offshore wind, solar
and battery storage to meet the 2050 state decarbonization goals. But
Economic Planning only sought to estimate the amount of capacity needed
to meet a target of reducing 1 million tons of carbon from fossil resources.
It did not attempt to answer the question of whether this new resource
mix would be adequate for meeting the electricity needs of New England
residents 24/7/365, in terms of cost and reliability. We believe this is the
far more important question, given that New England is responsible for
less than 0.4% of global emissions (related to heating, transportation and
electricity).6 Any attempts to affect the global climate through changes in
the types of energy used to generate electricity in New England is difficult
to justify
Driven largely by statewide commitments, the grid continues its shift
toward non-dispatchable generation resources like offshore wind, onshore
wind and solar photovoltaic (PV) systems.7 Over the next few decades,
these renewable resources are expected to substantially displace natural
gas-fired generation as the region’s primary resource type.
At the same time, increased electrification is expected to significantly
increase overall consumer demand for electricity and drive changes in
usage patterns that include seasonal and daily shifts in peak demand.8
ISO-NE projects that increased electrification will shift the region from
a summer peaking system to a winter peaking system with significantly
larger peak demands than currently observed.
Meeting the challenges of providing reliable, affordable energy with-
out generating greenhouse gas emissions will be made more difficult by
the anti-nuclear policies in five of the six New England states. Each of
these states, except for New Hampshire, has prohibitions or impediments
to the construction of new nuclear power plants.9,10
As a result, state mandates to reduce carbon dioxide emissions will rely
primarily on solar, offshore wind, onshore wind, battery storage and im-
ports from neighboring regions. This resource mix will impose significant
costs on New England families and businesses.
8
Policy Recommendations
1. Reconsider emission-reductions goals in the context of

affordability and reliability of electricity. Legislators should
prioritize affordability and reliability before emissions reduc-
tions goals. If emissions reduction goals cannot be reduced
without compromising affordability and/or reliability of elec-
tricity, they should be abandoned.
2. Lift state nuclear moratoriums. Lifting moratoriums and im-

pediments to building new nuclear power generators will be
the most reliable and affordable way to decarbonize the New
England grid. Connecticut, Maine, Massachusetts, Rhode
Island and Vermont each have substantial barriers to nuclear
energy.
3. Purchase Power Agreement transparency. Any state that

mandates contracts for certain types of energy should clearly
detail the cost of those contracts for the public. These re-
ports should provide ratepayers with the expected increases
(or decreases) in their monthly bills.
4. Allow nuclear to compete with renewables. Net Zero man-

dates treat renewable energy as more desirable than nuclear
energy, despite both producing no carbon emissions. Allow-
ing nuclear energy to be included toward meeting mandates
will lower the costs for businesses and households.
5. Require investment fee reporting. Mandatory reporting of

investment fees for state governments will allow for more
transparency around the cost and benefit of generally high-
er-risk alternative investments like private equity and hedge
funds, which are often used for ESG investments.
9
10
S EC T I O N I
New England State Policies
F ive of the six New England states have enacted a series of policies
that require the grid to greatly reduce carbon dioxide emissions from
the electricity sector, and many of these states have also enacted policies
designed to electrify the transportation and home heating sectors. These
electrification policies will result in large increases in the regional peak
electricity demand.
Connecticut
In May 2022, Connecticut Gov. Ned Lamont signed a law establish-

ing a 100 percent carbon-free by 2040 electricity mandate, codifying the
standard that the governor established through executive order in 2019.11
The legislation contained multiple benchmarks requiring emissions to be
45 percent lower than the levels emitted in 2001 by 2030, and 100 percent
carbon free by 2040.12
To meet these mandates, in 2019, Connecticut authorized the pro-
curement of 2,000 megawatts (MW) of offshore wind by 2030, with
the Connecticut Department of Energy and Environmental Protection
(DEEP) estimating the state will need 3,745 to 5,710 MW offshore wind
by 2040.13 While a joint offshore wind venture with Rhode Island and
Massachusetts is currently up in the air, Gov. Lamont and lawmakers have
continued to seek ways to make offshore wind work.14 Connecticut has
also established an energy storage mandate of 1,000 megawatts (MW) by
the end of 2030.15
Several ESG bills have been introduced into the Connecticut legis-
lature. In 2023, S.B. 1115 sought to leverage Connecticut’s position as a
national insurance provider and levy a 5% surcharge on policies insuring
real estate and assets owned by fossil fuel companies.
While S.B. 1115 died in committee, the fossil-fuel surcharge was re-
vived as a provision in S.B. 11, which implements Gov. Lamont’s budget
recommendations. Smuggling the surcharge into a larger omnibus bill
assures other recent ESG bills will get their second wind.
Maine
In 2019, Maine Gov. Janet Mills signed legislation that increased

Maine’s Renewable Portfolio Standard (RPS), a law requiring a specified
percentage of the electricity utilities sell comes from renewable resources,
11
from 40 percent by 2030 to 80 percent by 2030 and 100 percent renew-

able by 2050.16 However, in 2023, Gov. Mills announced her plan for
accelerating Maine’s trajectory to using 100 percent clean electricity from
2050 to 2040.17 Maine is also seeking to reduce its economy-wide emis-
sions by 45 percent below 1990 levels by 2030, and 80 percent below 1990
levels by 2050.18
The Brattle Group, a consulting firm, is currently conducting model-
ing on behalf of the Governor’s Energy Office in Maine to create a road-
map to enact these policies, including 80 percent renewable electricity
by 2030, 100 percent “clean” electricity by 2040, adding 3,000 MW of
offshore wind by 2040, adding 400 MW of storage by 2030, and installing
heat pumps in 100,000 homes by 2025 and more than 175,000 homes by
2027.19
In 2021, Maine became the first state in New England to successfully
require its state pensions to divest from fossil fuel companies. Similar leg-
islation has been introduced in Vermont, Connecticut and Massachusetts’
legislatures in recent years. As more states require their pension funds to
liquidate and ban future investment in fossil fuel companies, energy com-
panies will struggle to build new and maintain old natural gas pipelines.
Without local funding for projects, the natural gas pipelines New England
needs to achieve energy security may never be built.
Massachusetts
On March 26, 2021, then-Massachusetts Gov. Charlie Baker signed

legislation called “An Act Creating a Next-Generation Roadmap for Mas-
sachusetts Climate Policy” (“the Act”). The Act amends the state’s Global
Warming Solutions Act (GWSA) and requires Massachusetts to reduce
economy-wide emissions by 50 percent compared to the 1990 baseline by
2030, 75 percent below the 1990 baseline by 2040, and achieving net-zero
economy-wide greenhouse gas emissions by 2050.20
The Act also increased the state’s offshore wind procurement target
to 5,600 MW by June 30, 2027, and increased the required percentage of
renewable electricity generated in Massachusetts to 39 percent by 2029,
with the standard increasing by one percent per year thereafter.21,22 Mas-
sachusetts also has a Clean Energy Standard (CES), requiring 80 percent
of the electricity sold in the state to be carbon free by 2050.23 Due to the
heavy emphasis on the electrification of the transportation and home
heating sectors, Massachusetts will likely need to exceed these goals in
order to meet their economy-wide decarbonization targets.
The General Court of Massachusetts has also introduced legislation
establishing ESG investing principles for state pension funds. Taken as a
12
group, these bills would require fiduciaries to appraise companies’ climate

impact and require Massachusetts pension funds to divest all holdings in
fossil fuel companies.
New Hampshire
New Hampshire’s renewable energy mandates were established in

2007 and require the state’s electricity providers, with the exception of
municipal utilities, to acquire renewable energy certificates equal to 25.2
percent of retail electricity sold to end-user customers by 2025. The law
contains subcategories requiring that 15.7 percent of this total must come
from new renewable energy sources, such as wind or solar. Existing bio-
mass, landfill gas and small hydroelectric resources make up the remain-
ing percent of the Renewable Energy Mandate (REM) requirements.24
Although New Hampshire has no laws or targets for offshore wind,
the New Hampshire Department of Energy released a report in Septem-
ber of 2023 to study the feasibility of offshore wind turbines in the Gulf of
Maine.25
New Hampshire is the only state in New England that has not updat-
ed its Renewable Portfolio Standard (RPS) to align with the new net-zero
push. New Hampshire has not passed any ESG policies. New Hampshire’s
legislature nearly passed a bill banning fiduciaries from investing state
pension fund dollars in accordance with ESG metrics.26 In 2021, under
pressure from student activists, Dartmouth College pledged to divest the
endowment from all fossil fuel companies.27
Rhode Island
In June of 2022, Rhode Island passed legislation requiring that 100

percent of Rhode Island’s electricity be offset by renewable energy pro-
duction in 2033. Under the legislation, the 2022 REM target of 19%
would increase by an additional 4 percent in 2023, 5 percent in 2024, 6
percent in 2025, 7 percent in 2026 and 2027, 7.5 percent in 2028, 8 per-
cent in 2029, 8.5 percent in 2030, 9 percent in 2031, and 9.5 percent in
2032 in 2033 to achieve the goal of 100 percent of Rhode Island’s electric-
ity demand being offset by renewable energy by 2033 and thereafter.28
On July 6, 2022, Gov. Dan McKee signed a bill into law mandating
that Rhode Island’s primary utility, Rhode Island Power, procure between
600 to 1,000 MW of additional offshore wind to Rhode Island’s clean
energy portfolio standard.29
This legislation was seen as pivotal to achieving the mandates set forth
in the 2021 Act on Climate, which set mandatory, enforceable climate
13
emissions reduction goals of 45 percent below 1990 levels by 2030, 80

percent below 1990 levels by 2050, and net-zero emissions by 2050.30,31
To further the state’s commitment to climate goals, in June 2024,
Rhode Island passed H.B. 7127 which established ESG metrics to guide
fiduciaries charged with investing state pension funds. 32
Vermont
In June of 2024, the Vermont legislature overrode Gov. Phil Scott’s

veto to enact more-stringent renewable energy mandates for the state.33
These mandates would require Green Mountain Power, the state’s largest
electric utility, to obtain 100 percent of its electricity sales from renewable
energy by 2030. All other providers would be required to meet this man-
date by 2035.
The updated mandates effectively limit or prohibit new biomass plants
from meeting the standards; prevent power from new Canadian hydro-
electric dams in newly flooded areas from qualification; and establish
in-state and in-region mandates for the location of new renewable resourc-
es.34
For Vermont, “new renewable energy” means renewable energy ca-
pable of delivery in New England and produced by a specific and identifi-
able plant coming into service on or after January 1, 2010, but excluding
energy generated by a hydroelectric generation plant with a capacity of
200 MW or greater.
In June 2024, Vermont lawmakers followed Maine’s example and
passed a bill directing the state pension fund to divest from fossil fuels.35
Vermont’s Climate Change Cost Recovery Act seeks remuneration from
oil and natural gas companies for their past emissions.36
Vehicle Electrification Policies
In addition to mandates for renewable or carbon free electricity,

Massachusetts, Rhode Island and Vermont have adopted California’s Ad-
vanced Clean Cars II regulations that ban the sale of new internal com-
bustion vehicles by 2035.37
Connecticut and Maine have not adopted these regulations due to
overwhelming opposition by the public. Instead, lawmakers in Con-
necticut are considering legislation that would create a “Zero-Emissions
Vehicle Roadmap,” and Maine has established a goal of putting 41,000
light-duty electric vehicles (EVs) on the road by 2025 and 219,000 EVs,
constituting 18 percent of the total vehicle fleet, on the road by 2030.38,39,40
14
Meanwhile, New Hampshire currently has no regulations requiring

the sale of electric vehicles in the state.41
Are the New England Decarbonization Plans Realistic?
These state Decarbonization Plans will require a massive buildout of

new power plant capacity, costly transmission, electric vehicle infrastruc-
ture and the widespread deployment of heat pumps and other electric
heating equipment on an aggressive timeline that may not even be possi-
ble.
Our analysis shows that these plans would require New England states
to operate 66 gigawatts (GW) of offshore wind capacity, 19.2 GW of on-
shore wind, 68.4 GW of solar capacity, and 43 GW of four-hour battery
storage capacity by 2050. In 2022, New England states had just 4.07 GW
of renewables: 0.03 GW of offshore wind, 1.5 GW of onshore wind, 2.24
GW of utility-scale solar, and 0.30 GW of battery storage.42
For context, there are 1,000 MW in one GW, meaning New England
will need 2,277 times more offshore wind capacity, 12.4 times more on-
shore wind capacity, 30.5 times more solar capacity, and 142 times more
battery storage in the next 26 years than were in operation on the grid in
2022.
15
16
S EC T I O N I I
Impacts of Decarbonization Policies on

ISO-NE Electricity Production
T he policies designed to decarbonize the power grid will have a pro-

found impact on the way New Englanders produce their electricity.
In 2023, ISO-NE sold 114.7 million megawatt hours (MWh) of elec-
tricity.43 According to the Internal Market Monitor (IMM) for ISO-NE,
48 percent of the region’s electricity was generated at natural gas fired
power plants in 2023, 20 percent from nuclear power, 13 percent from net
imports (New England exported some generation) — largely hydro im-
ports from Hydro Quebec— 8 percent was from in-region hydroelectric
power; 4 percent was “other”; 3 percent was wind; 3 percent solar; and
Energy Supply Mix ISO-NE 2023
3% 3% 0.2%
0.3%
0.2%
4%
8%
48%
13%
20%
Natural Gas Nuclear Imports Hydroelectric Other
Wind Solar Coal Oil Battery Storage
SOURCE: ISO-NE Internal Market Monitor
FIGURE 1. Natural gas and nuclear power produce the largest share of
electricity in New England, followed by imports and hydroelectric power. Wind
and solar each produced 3 percent of the total electricity consumed in the
region.
17
Energy Supply Mix ISO-NE 2050
1% 2%
6% 7%
11%
3%
43% 9%
18%
Natural Gas Hydro/Pumped Storage Nuclear Other Onshore Wind

Solar Offshore Wind Storage Imports
SOURCE: ISO-NE Internal Market Monitor
FIGURE 2. Offshore wind becomes the largest source of electricity in New

England.
coal, oil and battery storage constituted 0.2, 0.3, and 0.2 percent of the
region’s electricity supply, respectively. (See Figure 1)44
This resource mix will change substantially due to the policies of the
five decarbonizing states. Our modeling indicates total electricity con-
sumption will explode from 114.7 million MWh in 2023 to 244.4 million
MWh by 2050.
Figure 2 shows the ISO-NE resource mix in 2050, when the decar-
bonization mandates go into full effect. Our modeling indicates that in
2050, the energy mix will consist of 43 percent offshore wind, 18 percent
solar, 11 percent nuclear, 9 percent onshore wind, 7 percent natural gas,
6 percent imports, 1 percent battery storage, 2 percent hydroelectric and
pumped storage, and 3 percent other.
The natural gas remaining on the system serves electricity demand
in New Hampshire, which will see an increase in natural gas capacity to
meet any future increases in demand. Figure 3 shows the change in elec-
tricity generation over time.
18
FIGURE 3. Offshore wind and solar have become the largest energy sources under the energy
policies of the New England states. Existing nuclear plants continue to operate but constitute a
smaller share of overall generation as demand for power increases due to the electrification of
transportation and home heating.
19
20
S EC T I O N I I I
Energy Demand
I SO-NE expects a substantial increase in the total amount of electricity

consumed in the coming decades due to the economy-wide decarbon-
ization mandates in the five decarbonizing states. Our analysis finds that
electrifying the transportation and home heating sectors will cause ISO-
NE’s annual electricity consumption to grow by 106 percent by 2050.
Furthermore, ISO-NE’s 2050 Transmission Study estimates the region will
become a winter-peaking system in 2035.45
FIGURE 4. This figure shows peak electricity demand in Gigawatts(GW).
21
However, the increase in electricity use for transportation and home

heating will drive peak electricity demand substantially higher than it
is today. According to the Internal Market Monitor, the average hourly
electricity demand in 2023 was 13 GW, with a peak demand of 24 GW.46
By 2050, winter peak demand could hit 57 GW, more than doubling the
current winter peak record of 23 GW.47 (See Figure 4)
Our analysis adopts many of the same assumptions as the 2050 Trans-
mission Study by assuming the five states with decarbonization policies
will completely adopt electric vehicles and electric home heating systems.
However, our modeling assumes New Hampshire residents will contin-
ue to use natural gas power plants as well as conventional home heating
systems and internal combustion engines. This results in reducing peak
electricity demand by 4,457 MW on the ISO-NE system for a new total
peak demand of 52.5 GW.
Meeting these new peak electricity demands will require a massive
increase in the amount of power plant capacity on the ISO-New England
power system.
22
23
S EC T I O N I V
Calculating the Cost of the New

England Decarbonization Plans
N ew England residents already pay some of the highest electricity pric-

es in the country. The region’s state Decarbonization Plans would
cause these prices to rise significantly.48
Our modeling indicates that complying with the New England Decar-
bonization Plans will cost an additional $815 billion over the next 26 years
(in constant, inflation adjusted, 2023 dollars) compared to operating the
current electric grid.49 This figure does not include federal subsidies This
would more than double electricity prices, with all-sectors electricity rates
rising from 22.78 cents per kilowatt hour (kWh) in 2023 to 51.58 cents per
kWh in 2050 — an increase of 28.79 cents per kWh.
As a result, the average annual electricity cost for each New England
utility customer — a total including residential, commercial, and indus-
trial customers — would increase by $4,218 from 2024-50, an average of
$162.23 every year (see Figure 5).
Total Annual Cost per Customer in ISO-NE
$8,000 $7,555
Total Additional Cost (Constant $2023)
$7,000
$6,000
$5,000
$3,453
$4,000
$3,000
$2,000
$1,000
$0
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
FIGURE 5. Costs for New Englanders increase by an average of $162 annually under the New England
Decarbonization Plans. Total costs peak at $4,218 above the 2024 level in 2050.
24
Figure 5 shows the average additional cost of complying with the New
England Decarbonization Plans from 2024 through 2050, compared to
the current cost of electricity. This number is obtained by dividing the
overall costs of the mandates among all New England utility customers,
including residential, commercial, and industrial electricity users by the
number of years examined. The New England Decarbonization Plans im-
mediately increase electricity costs as offshore wind, onshore wind, solar,
battery storage and transmission projects are built.
It is important to note that these rate analyses do not calculate the cost
savings that would accrue to New Hampshire residents by continuing to
use natural gas for power generation.
Generating more electricity is relatively easy with dispatchable power
plants — plants that can be turned up or down on command — like those
powered with coal, natural gas, nuclear fuel, or hydroelectric plants. But
adjusting to second-by-second fluctuations in electricity demand is much
more difficult with wind and solar, whose electricity production is subject
to second-by-second fluctuations in the weather. As a result, it is much
more difficult to provide reliable power as regions become more reliant
upon wind and solar to meet their energy needs.
It is possible to mitigate some of the inherent unreliability of wind and
solar by vastly increasing the amount of wind and solar capacity on the
grid (known as “overbuilding” wind and solar installations) to allow elec-
tricity demand to be met even on cloudy or low-wind days, and curtailing,
or turning off, much of this capacity when wind and solar production is
higher. Other mitigation strategies include building more transmission
lines and battery storage facilities. Each of these mitigation strategies,
however, is a major cost driver for the entire electric system.
These mitigations come with other additional costs, including higher
profits for transmission and distribution companies and higher state and
federal taxes. Each of these additional costs will be discussed in greater
detail in the ensuing sections.
Residential Customers
Under the New England Decarbonization Plans, residential electricity

prices would more than double by 2050, causing New England families to
see their annual electricity costs increase by $2,574 above 2024 costs, an
increase of $214 per month (see Figure 6). While these costs are projected
to increase in some years more than others, New England households can
expect to see their electric bills increase $99.04 every year from 2025 to
2050.
25
Total Annual Cost per Residential Customer in ISO-NE
$5,000 $4,610
$4,000
$3,000
$2,107
$2,000
$1,000
$0
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
FIGURE 6. New England families would see their electric bills increase by an average of $99 per year.
Commercial Customers
New England’s commercial customers currently use about 45% of its

electricity. Under the New England Decarbonization Plans, small busi-
nesses, grocery stores and other retailers would see their electricity costs
increase $12,726 by 2050 — or an average of $489.46 per year from 2025
to 2050. (see Figure 7).
These higher electricity costs would likely be passed on to consumers
in the form of higher prices for goods and services.
Industrial Customers
Industrial companies in New England, such as manufacturers, used

roughly 13% of the electricity consumed in the region in 2023.50 Un-
der the New England Decarbonization Plans, electricity costs for these
firms would rise by an average of $5,280 every year, with costs reaching
$137,275 above 2024 costs in 2050 (see Figure 8).
Meanwhile, academic research suggests that high electricity costs play
a role in investment decisions made by companies to relocate their facil-
26
Total Annual Cost per Commercial Customer in ISO-NE
$25,000 $22,794
$20,000
$15,000
$10,000
$5,000
$0
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
FIGURE 7. Costs for commercial customers, such as small businesses, rise quickly, at $490 every year,
peaking at $12,726 in 2050.
Total Annual Cost per Industrial Customer in ISO-NE
$300,000 $245,883
$250,000
$200,000
$150,000
$112,387
$100,000
$50,000
$0
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
FIGURE 8. Industrial electricity consumers would experience cost increases of $137,275 over the next
26 years, averaging $5,280 per year under the New England Decarbonization Plans.
27
ities.51 If electricity prices for businesses in New England become overly

burdensome, it may incentivize these companies to relocate to lower-cost
locations.
Additionally, New England Decarbonization Plans compliance costs
are driven by the need to build enough offshore wind turbines, onshore
wind turbines, solar panels, battery storage facilities and transmission lines
to meet the emissions requirements stipulated in the decarbonization poli-
cies enacted by the five states.
Other factors that increase costs include the cost of building new gen-
eration assets. Figure 9 shows that on a per-capita basis, the cumulative
cost of the plans increases expenses for each person in New England by an
additional $2,061 in 2030, $15,552 in 2040, and an additional $51,914 in
2050.
Using these per-capita figures, we can estimate how much each state
can expect to pay of the $815 billion total cost, as seen in Figure 10.
Using state-level population forecasts for 2030, 2040 and 2050 from the
non-partisan Weldon Cooper Center, the premier organization in charge
Total Cost per Capita in ISO-NE
$60,000
$51,914
$50,000
$40,000
Cost per Capita
$30,000
$20,000
$15,552
$10,000
$2,061
$0
2030 2040 2050
FIGURE 9. Total Cost per Capita in ISO-NE
28
Total Cost per State in the ISO-NE Footprint

$405.1 B
$400 B
$350 B
$300 B
Total Cost ($ Billion)
$250 B
$200 B
$175.2 B
$150 B
$118.9 B
$100 B
$69.3 B $74.0 B
$58.4 B $54.8 B
$50 B $32.9 B
$17.6 B $21.3 B $15.3 B $10.1 B $22.3 B
$2.3 B $2.9 B $7.5 B $1.4 B $2.9 B
$0
Rhode island Maine Massachusetts Connecticut Vermont New Hampshire
FIGURE 10. Total costs per state under 225 GW buildout scenario.
of population projects based on US Census data, we estimated that Mas-

sachusetts would pay the most: $405.1 billion in imposed costs by 2050.52
Connecticut comes in second, with $175.2 billion in imposed costs. New
Hampshire ($74 billion), Maine ($69 billion), Rhode Island ($58.4 billion)
and Vermont ($32.9 billion) account for the remaining estimate.
Of course, the costs for a resident of an individual state will vary be-
yond per-capita cost calculations due to several factors. States that serve
more rural customers may have to build more transmission lines and pass
those costs on to ratepayers. States with more aggressive emission reduc-
tions goals will incur higher costs on behalf of ratepayers (such as Massa-
chusetts and Vermont), while states with less aggressive reduction goals
will incur lower costs for ratepayers (New Hampshire).
29
30
S EC T I O N V
How Offshore Wind, Onshore Wind,

Solar, and Battery Storage Facilities
Drive Up Costs Compared to Reliable
Power Plants
T hus far, this report has summarized the cost difference between the
New England Decarbonization Plans and using New England’s ex-
isting power plants. In this section, we will discuss how attempting to run
a reliable electric grid using mostly offshore wind, onshore wind, solar,
imports and battery storage drives up costs to a much greater extent than
building a grid using reliable power plants.
The most important thing to know about the electric grid is that the
supply of electricity must be in perfect balance with demand at every
second of every day.53 If demand rises as New Englanders turn on their air
conditioners, heaters or charge their electric vehicles, an electric company
must increase the supply of power to meet that demand. If companies are
unable to increase supply to meet demand, grid operators are forced to
cut power to consumers — i.e., initiate brownouts, a temporary reduction
in voltage levels that causes lights to dim and appliances to malfunction or
shut down. In a worst-case scenario, an electric company could resort to
blackouts, a complete loss of power that can cause all lights and appliances
to shut down, to keep the entire grid from crashing.
It is possible to mitigate some of the inherent unreliability of wind and
solar by vastly increasing the amount of wind and solar capacity on the
grid (known as “overbuilding” wind and solar installations) to allow elec-
tricity demand to be met even on cloudy or low-wind days, and curtailing,
or turning off, much of this capacity when wind and solar production is
higher. Other mitigation strategies include building more transmission
lines and battery storage facilities. Each of these mitigation strategies,
however, is a major driver of cost for the entire electric system.
These mitigations come with other additional costs, including higher
profits for transmission and distribution companies and higher state and
federal taxes. Each of these additional costs will be discussed in greater
detail in the ensuing sections.
Increasing Electricity Generation Capacity
Building and operating new power plants is expensive. The New En-
gland Decarbonization Plans would greatly increase the amount of new
31
ISO-NE Generating Capacity
250,000
200,000
Capacity MW
150,000
100,000
50,000
0
Current Grid 2050
Coal Gas Oil Hydro/Pumped Storage Nuclear Other
Onshore Wind Solar Offshore Wind Storage
FIGURE 11. According to our analysis, complying with the New England
Decarbonization Plans would require almost 6.4 times more installed capacity
on the New England electric grid to maintain a reliable system, based on
2023 wind and solar output. This massive buildout of capacity would drive
significant cost increases for families and businesses.
power plant capacity on the New England electric grid, which is why the
plans are so costly.
In 2022, New England had roughly 35,500 MW of installed power
plant capacity on the grid and could draw from 4,475 MW of import
capacity — supplying 13 percent of electricity in ISO-NE — to meet elec-
tricity demand. These imports come from neighboring control areas like
New York and even Canada.54
Under the New England Decarbonization Plans, our modeling indi-
cates that the amount of installed power plant capacity in New England
would need to increase from 35,500 MW in 2022 to 225,400 MW by 2050
(not including imports). This means the New England Decarbonization
Plans would require nearly 6.4 times more power plant capacity than is
currently used to meet New England’s electricity demand. (See Figure 11)
32
Offshore wind installations under the New England Decarbonization

Plans would increase from 30 MW of installed capacity in 2022 to 66 GW
of capacity in 2050. Onshore wind would increase from 1,546 MW to
19.2 GW. Solar capacity would grow from 2,242 MW to 68.4 GW, and
battery storage would increase from 303 MW to 43 GW, with four hours
of storage per MW (See FIGURE 11). Additionally, transmission capacity
to neighboring regions would grow from 4,475 MW to 6,675 MW, but
these figures are not reflected in Figure 11.55
A portion of the extra wind and solar power must be used to charge
the batteries. Once the batteries are fully charged, any additional solar
or wind power that is generated is curtailed or turned off. Curtailment is
expected to become increasingly common in New England and the nation
as more wind and solar facilities are placed into service on the grid.56,57
It is important to note that our model selected these quantities of solar,
offshore wind, onshore wind and battery storage resources because they
were the most cost-effective portfolio for meeting the carbon-free energy
mandates proposed by New England states, while also maintaining grid
reliability under 2023 wind and solar generation conditions and future
hourly load profiles derived from data obtained from ISO-NE’s website58
Building these solar panels, offshore wind turbines, onshore wind
turbines and battery storage facilities would cost $104 billion, $334 billion,
$35 billion, and $78 billion, respectively, while repowering these facilities
at the end of their 20- to 25-year useful lives would cost an additional
$51.8 billion. The additional transmission lines would cost $23.5 billion,
but have a useful service life beyond the scope of this analysis and would
not need to be rebuilt.
Our analysis finds that the ISO-NE grid would require substantially
more capacity than shown in the Economic Planning for the Clean Ener-
gy Transition report released by ISO-NE in August 2024. That analysis
estimated a need for 97 GW of onshore wind, offshore wind, solar and
battery storage and 30 GW of existing dispatchable resources, such as
natural gas or nuclear power, to meet future decarbonization goals.
It is important to note that Economic Planning did not perform a re-
source adequacy analysis. It was a report designed to estimate the amount
of capacity needed to meet a target of reducing 1 million tons of CO2
from fossil resources.
Based on the hourly load profiles used in our analysis, this resource
portfolio would not be sufficient to maintain reliability during periods
of low wind and solar output, even when 20,454 MW of natural gas are
retained (See Figure 12). Not shown in the graph are the 6,675 MW of
“firm transmission” resources.
33
ISO-NE Generating Capacity: ISO-NE EPCET Report

vs. Modeled Capacity Requirement
250,000
200,000
Capacity MW
150,000
100,000
50,000
0
ISO-NE EPCET Modeled Capacity
FIGURE 12. The ISO-NE study has less total installed capacity than our
modeling indicate will be necessary to maintain reliability based on historical
wind and solar output and projected future hourly load shapes.
Figure 13 shows the electricity provided by each resource from De-

cember 15 through December 19 in 2050, at a period in time when
electricity demand is expected to be the highest, based on the data from
ISO-NE. This is commonly referred to as “peak electricity demand.”
Electric grids must be built to accommodate this demand plus a margin
of safety — called a “reserve margin” — much in the same way a bridge
must be built to handle its maximum capacity plus a factor of safety, mak-
ing it stronger than its expected maximum load.
This graph, which is based on 2023 real-world output data for on-
shore wind and solar in the ISO-NE region and variable energy resource
data from ISO-NE for 2019 for offshore wind, shows a hypothetical week
in 2050 under the New England Decarbonization Plans.59 Hourly electric-
ity demand profiles were obtained from the 2024-2033 NE Region hourly
load forecast, and values were adjusted upward to meet a projected peak
demand of 52.5 GW in this report.60
34
ISO-NE Hourly Electricity Supply During Peak Demand in 2050 Using

2019 Wind and Solar Output
80,000
70,000
60,000
Generation MW
50,000
40,000
30,000
20,000
10,000
0
12/14/50 0:00
12/14/50 2:00
12/14/50 4:00
12/14/50 6:00
12/14/50 8:00
12/14/50 10:00
12/14/50 12:00
12/14/50 14:00
12/14/50 16:00
12/14/50 18:00
12/14/50 20:00
12/14/50 22:00
12/15/50 0:00
12/15/50 2:00
12/15/50 4:00
12/15/50 6:00
12/15/50 8:00
12/15/50 10:00
12/15/50 12:00
12/15/50 14:00
12/15/50 16:00
12/15/50 18:00
12/15/50 20:00
12/15/50 22:00
12/16/50 0:00
12/16/50 2:00
12/16/50 4:00
12/16/50 6:00
12/16/50 8:00
12/16/50 10:00
12/16/50 12:00
12/16/50 14:00
12/16/50 16:00
12/16/50 18:00
12/16/50 20:00
12/16/50 22:00
12/17/50 0:00
12/17/50 2:00
12/17/50 4:00
12/17/50 6:00
12/17/50 8:00
12/17/50 10:00
12/17/50 12:00
12/17/50 14:00
12/17/50 16:00
12/17/50 18:00
12/17/50 20:00
12/17/50 22:00
12/18/50 0:00
12/18/50 2:00
12/18/50 4:00
12/18/50 6:00
12/18/50 8:00
12/18/50 10:00
12/18/50 12:00
12/18/50 14:00
12/18/50 16:00
12/18/50 18:00
12/18/50 20:00
12/18/50 22:00
Hydroelectric Nuclear Other Natural Gas Wind
Offshore Wind Solar Imports Storage Demand
FIGURE 13. Battery storage is needed to help meet electricity needs during periods where wind and
solar generation is insufficient to meet demand. The batteries are charged by the solar panels and wind
turbines when their generation exceeds the black demand line and discharged when wind and solar are
unavailable. This analysis uses data from the ISO-NE Variable Energy Database. 2023 hourly generation
data for onshore wind and solar were used and 2019 data were used for offshore wind because more
recent data was not available.
Our modeling determined 225.4 GW of total capacity would be nec-

essary to meet electricity demand during this period because the region
experiences low solar and offshore wind production during the peak
demand period.
Figure 14 shows electricity demand, capacity factors for solar, onshore
wind, offshore wind and the charge percentage of battery resources from
12:00 p.m. on December 16 through 12:00 p.m. on December 18 in 2023.
35
Capacity Factors for Wind and Solar and Charge of Battery Storage
During 2023 Peak Demand
120% 60,000
Peak Demand
100% 50,000
Capacity Factor
80% 40,000
60% 30,000
40% 20,000
20% 10,000
0 0
16Dec2023 12:00:00
16Dec2023 13:00:00
16Dec2023 14:00:00
16Dec2023 15:00:00
16Dec2023 16:00:00
16Dec2023 17:00:00
16Dec2023 18:00:00
16Dec2023 19:00:00
16Dec2023 20:00:00
16Dec2023 21:00:00
16Dec2023 22:00:00
16Dec2023 23:00:00
17Dec2023 0:00:00
17Dec2023 1:00:00
17Dec2023 2:00:00
17Dec2023 3:00:00
17Dec2023 4:00:00
17Dec2023 5:00:00
17Dec2023 6:00:00
17Dec2023 7:00:00
17Dec2023 8:00:00
17Dec2023 9:00:00
17Dec2023 10:00:00
17Dec2023 11:00:00
17Dec2023 12:00:00
17Dec2023 13:00:00
17Dec2023 14:00:00
17Dec2023 15:00:00
17Dec2023 16:00:00
17Dec2023 17:00:00
17Dec2023 18:00:00
17Dec2023 19:00:00
17Dec2023 20:00:00
17Dec2023 21:00:00
17Dec2023 22:00:00
17Dec2023 23:00:00
18Dec2023 0:00:00
18Dec2023 1:00:00
18Dec2023 2:00:00
18Dec2023 3:00:00
18Dec2023 4:00:00
18Dec2023 5:00:00
18Dec2023 6:00:00
18Dec2023 7:00:00
18Dec2023 8:00:00
18Dec2023 9:00:00
18Dec2023 10:00:00
18Dec2023 11:00:00
18Dec2023 12:00:00
Demand Onshore Wind Offshore Wind Solar Battery Charge
FIGURE 14. During a 36-hour period stretching from noon on December 16 until midnight on December
17, 2023, the offshore wind on the ISO-NE system performs at an average capacity factor of 4.9 percent.
From 12:00 p.m. to 6:00 p.m. (18:00), onshore wind, offshore wind,
and solar generation fall substantially, leading the battery charge to fall
from 100 percent on to 80 percent, and the battery charge falls further in
the ensuing hours as solar and offshore wind generation — which consti-
tute 60 percent of the total installed capacity in our modeled system — are
effectively zero until 8:00 a.m. on December 17.
The battery storage is drained further as solar generation on December
17 reaches a capacity factor of just 18 percent, which is 4.4 times less than
the solar output observed on December 16. Additionally, electricity de-
mand increases to 52.5 GW at 4:00 PM (16:00) on December 17, resulting
in a situation where demand is highest but offshore wind and solar resourc-
es are producing almost no electricity. It should be noted that onshore
wind performs well during this stretch, which is why our model selects
more onshore wind for the resource portfolio to add operational diversity.
36
ISO-NE EPCET Report Capacity Buildout During Peak Demand in

2050 Using 2023 Wind and Solar Output
60,000
18-hour blackout
50,000
Generation MW
40,000
30,000
20,000
10,000
0
12/16/50 12:00
12/16/50 13:00
12/16/50 14:00
12/16/50 15:00
12/16/50 16:00
12/16/50 17:00
12/16/50 18:00
12/16/50 19:00
12/16/50 20:00
12/16/50 21:00
12/16/50 22:00
12/16/50 23:00
12/17/50 0:00
12/17/50 1:00
12/17/50 2:00
12/17/50 3:00
12/17/50 4:00
12/17/50 5:00
12/17/50 6:00
12/17/50 7:00
12/17/50 8:00
12/17/50 9:00
12/17/50 10:00
12/17/50 11:00
12/17/50 12:00
12/17/50 13:00
12/17/50 14:00
12/17/50 15:00
12/17/50 16:00
12/17/50 17:00
12/17/50 18:00
12/17/50 19:00
12/17/50 20:00
12/17/50 21:00
12/17/50 22:00
12/17/50 23:00
12/18/50 0:00
12/18/50 1:00
12/18/50 2:00
12/18/50 3:00
12/18/50 4:00
12/18/50 5:00
12/18/50 6:00
12/18/50 7:00
12/18/50 8:00
12/18/50 9:00
12/18/50 10:00
12/18/50 11:00
12/18/50 12:00
Offshore Wind Solar Imports Storage Capacity Shortfalls Demand
FIGURE 15. The capacity buildout in the EPCET report is insufficient to maintain reliability during peak
demand.
Using these same hourly electricity demand and capacity factors, the
grid in ISO-NE’s Economic Planning for the Clean Energy Transition
report would be unable to meet the hourly electricity demand. Figure 15
uses battery storage assumptions provided by ISO-NE (14,664 MW four-
hour storage and 13,000 MW eight-hour storage), but the low offshore
wind and solar output during the time period studied results in massive
capacity shortfalls (i.e., significantly more capacity will be necessary to
decarbonize the ISO-New England system).
As you can see, offshore wind experiences a large drought where it
produces, on average, 4.9 percent of its total capacity, and solar experi-
ences a dramatic reduction in output on December 17 compared to the
day before. Due to the lack of dispatchable capacity to charge the batter-
ies, available storage is fully depleted and is unable to recharge because all
available resources, including imports, are being used to meet demand. As
37
a result, an 18-hour capacity shortfall event occurs starting at 3:00 a.m. on

December 17 and lasting until 9:00 p.m. on December 17. The maximum
hourly shortfall reaches as high as 18,125 MW right as peak demand oc-
curs at 4:00 PM, representing 35 percent of the system demand.
Transmission Costs
Transmission lines are important. It does no good to generate electrici-

ty if it cannot be transported to the homes and businesses that rely upon it.
Transmission costs are driven by the need to build new infrastructure
to connect ISO-NE to Hydro Quebec, connect new offshore and onshore
wind turbines and solar panels to the rest of the electric grid, and allow for
greater interregional connectivity within New England.
The ISO-NE 2050 Transmission Study estimates the region will require
extensive upgrades to the regional transmission network to accommodate
the state Decarbonization Plans. In addition to making upgrades to the
network of existing transmission lines, the 2050 Transmission Study esti-
mates the completion of two additional international transmission lines,
including the completion of the 1,200 MW New England Clean Energy
Connect High Voltage Direct Current (HVDC) line, and a hypothetical
1,000 MW HVDC line connecting Quebec and Vermont.61
ISO-NE estimates rising peak demand will cost roughly $750 million
per gigawatt (GW) of load added from 28 GW to 51 GW, and roughly
$1.5 billion per GW from 51 GW to 57 GW. (See Figure 16)62
ISO-NE notes the New England grid with 100 percent heating and
transportation electrification is expected to result in a peak load of around
57 GW, but a lower peak load could be achieved with less electrification of
the transportation and home heating sectors.
In our analysis, New Hampshire serves to reduce peak load by nearly
4.5 GW by continuing to heat homes with natural gas and fuel oil and by
continuing to use internal combustion engines.63,64 As a result, the neces-
sary increase in transmission spending grows to $22.8 billion by 2050.
Generator Profits
Unlike other areas of the country where monopoly utilities own genera-
tion, transmission, and distribution of electricity, power generators in ISO-
NE are not monopolies and therefore they are not entitled to recover the
cost of providing service to ratepayers with a government-approved return
on investment. Instead, generators sell their power and reliability attributes
into the wholesale energy, capacity and ancillary service markets.
However, according to ISO-NE, several states have established public
38
FIGURE 16. Transmission costs would increase substantially to accommodate a peak load of 57 GW.
policies that direct electric power companies to enter ratepayer-funded,

long-term contracts for large-scale carbon-free energy that would cover
most, if not all, of the resource’s costs.65 These contracts must be lucra-
tive enough to attract investment to the industry and allow companies to
recover the upfront capital cost of the generators with a reasonable rate of
return for shareholders.
As these carbon-free resources produce increasing amounts of electric-
ity on the grid, they are expected to reduce the wholesale clearing prices
for all generators, including new wind and solar generators66,67 While
there are advantages to lower wholesale energy costs, the trend toward
lower, and potentially negative, clearing prices will deprive dispatchable
generators of some of the revenue needed to remain on the system for the
important periods when there is low wind or solar generation, which can
collapse the competitive energy market.
This is why the Economic Planning for the Clean Energy Transition doc-
ument released by ISO-NE stated that dispatchable units that are infre-
quently run may result in these generators receiving more of the revenues
needed to operate the plant through capacity and ancillary service mar-
kets. These generators may also obtain separate contracts to remain on
39
the system to generate electricity when it is needed, as was the case for the
Mystic Generating Station.68,69
ISO-NE notes: “During the final years of analysis, the majority of
revenue for all generators is earned through either the capacity market
or out-of-market PPAs.”70 Therefore, we at Always On Energy assumed
that all generation assets built in our model would be able to recover their
upfront capital costs, with a 7.05 percent return on investment.
As a result, additional generator profits stemming from the New En-
gland Decarbonization Plans are $323 billion through 2050.
Additional Property, State and Federal Taxes
Property tax collections increase under the New England Decarbon-

ization Plans because compared to the current grid, there is much more
property to tax. While the property taxes assessed on power plants are of-
ten a crucial revenue stream for local communities that host power plants,
these taxes also effectively increase the cost of producing and providing
electricity for everyone.
Some New England states exempt renewable energy facilities from
property taxes entirely, while others assess a “payment in lieu of tax”
payment on these facilities, and in some jurisdictions these facilities are
taxed at normal rates. To simplify these differences, this model assumes a
property tax rate of 1 percent of net capital investment (gross plant value
minus depreciation).
Additionally, state and federal income taxes increase due to the growth
in income for power producers in the region. As a result, additional taxes
are $115 billion through 2050.
Summary of Costs
While New England will experience modest declines in fossil fuel

expenditures through 2050, $14.8 billion through the model run, these
savings are far outweighed by the additional capital costs, fixed operations
and maintenance costs, taxes, and the need for out-of-market purchase
power agreements (utility profits). These costs result in a net expenditure
of $814.8 billion through 2050. (See Figure 17)
What’s the Cost to ISO-NE if New Hampshire

Pursues Net Zero?
In this analysis, New Hampshire’s energy policies produce substantial

benefits for the entire ISO-NE region. The Granite State’s lack of electri-
40
Total Additional Costs from 2024 through 2050
$800 B
Net Costs
$814.8 B
$700 B
$323.3 B
Additional Expenses (Constant $2023)
$600 B
$0.6 B
$500 B
$115.3 B
$400 B
$132.7 B
$300 B
$200 B
$247.6 B
$100 B
$10.8 B
0
$(14.8 B)
$(0.6 B)
Utility Profits Imports Taxes Fixed O&M Capital Costs
Transmission Fuel Costs Variable O&M
FIGURE 17. The total cost would be $814.8 billion through 2050.
fication mandates for transportation and home heating reduces the pro-
jected peak system demand from 57 GW to 52.5 GW, and the continued
use of natural gas provides critical dispatchable capacity for the system,
allowing it to perform better during periods of low wind and solar output.
Our initial analysis assumed that New Hampshire would add new
natural gas capacity to meet rising demand for electricity. Under a scenar-
io where New Hampshire also pursues decarbonization of its economy,
demand will peak at 57 GW, and these new natural gas facilities would
not be constructed.
As a result, the installed capacity on the ISO-NE system would need
41
ISO-NE Generating Capacity: Current Grid vs. 2050
250,000 240,332
225,400
46,690
42,963
200,000
70,029
Capacity MW
150,000 66,029
100,000
73,761
68,364
50,000
35,465 19,179 25,386
16,817 20,454 16,054

0
Current Grid 2050 2050
No New Hampshire With New Hampshire
FIGURE 18. No New Hampshire shows the capacity needed if New Hampshire
does not decarbonize its grid, and Including New Hampshire shows the
capacity needed if New Hampshire also pursues decarbonization of its
economy.
to increase by 15 GW to meet the new peak electricity demand and re-

place the lost generation of potential new natural gas power plants. This
would require an additional 4 GW of offshore wind capacity, 4.6 GW of
onshore wind capacity, 3.2 GW of solar capacity, and 3.4 GW of battery
storage. (See Figure 18)
Constructing and operating these additional facilities, and paying the
additional taxes, transmission expenses and generator profits would cost
$871 billion through 2050, meaning New Hampshire’s current energy
policies would save all New Englanders $56.5 billion during the time peri-
od studied.
42
43
44
S EC T I O N V I
The Levelized Cost of Energy for

Different Generating Resources
A lmost all studies that examine the cost of renewable energy use a
methodology called the Levelized Cost of Energy (LCOE) to assess
the cost of offshore wind, onshore wind and solar compared to different
technologies.71 LCOE estimates reflect the cost of generating electricity
from different types of power plants, on a per-unit of electricity basis (gen-
erally megawatt hours), over an assumed lifetime and quantity of electrici-
ty generated by the plant.
In other words, LCOE estimates are essentially like calculating the
cost of your car on a per-mile-driven basis after accounting for expenses
like initial capital investment, loan and insurance payments, fuel costs and
maintenance.
Wind and solar advocates often misquote LCOE estimates from
Lazard, a financial advisory firm, or the US Energy Information Admin-
istration (EIA) to claim that wind and solar are now lower cost than other
sources of energy. However, Lazard and EIA show the cost of operating a
single wind or solar facility at its maximum reasonable output; they do not
convey the cost of reliably operating an entire electricity system with high
penetrations of wind and solar, which costs exponentially more.72
For example, Lazard and EIA do not account for the expenses in-
curred to build new transmission lines, additional taxes, or the cost of
providing backup electricity with battery storage when the wind is not
blowing or the sun is not shining, referred to as a battery storage cost in
this report. 73
Even more importantly, the LCOE estimates generated by Lazard
and EIA do not account for the massive overbuilding and curtailment
that must occur to ensure that grids with high reliance on wind, solar and
battery storage meet electricity demand.74
It is important to understand that the costs associated with load bal-
ancing, overbuilding and curtailment increase dramatically because the
amount of wind, solar and battery storage must be “overbuilt” to account
for the intermittency of wind and solar, which is why the New England
Decarbonization Plans require an installed capacity of 225 GW to meet
the projected peak demand of 52.5 GW.
Our model accounts for all these additional expenses and attributes
them to the cost of wind and solar to get an ‘All-In’ LCOE value for these
energy sources. Our ‘All-In’ LCOE represents the cost of delivering the
same reliability value of other generating technologies, allowing for an
45
ISO-NE All-InSystem Cost per Megawatt-hour (MWh):

Existing vs. New Energy Sources
$500
$436
$400
$357
System Cost ($/MWh)
$300
$240
$200
$98
$100 $77
$37
$0
Coal Natural Gas Natural Gas Onshore Wind Solar Offshore Wind
Combined Cycle Combustion
Turbine
EXISTING NEW
Curtailment/Overbuilding Capital Cost O&M Utility Profits

Taxes Transmission Load Balancing Fuel
FIGURE 19. New offshore wind facilities are the most expensive form of new electricity generation built
under the New England Decarbonization Plans. Once costs such as state taxes, transmission, utility returns,
battery storage, and overbuilding and curtailment, are accounted for new offshore wind costs $436 per
MWh, onshore wind costs $240 per MWh, and new solar costs $357 per MWh.
apples-to-apples comparison of the cost of reliably meeting electricity de-

mand with existing nuclear, natural gas and coal plants operating in New
England, with new plants built under the New England Decarbonization
Plans.
The cost of existing natural gas generators was estimated using his-
torical construction costs based on the average plant life of each energy
source and current variable and fixed operation and maintenance (O&M)
46
expenses obtained from the U.S. Energy Information Administration.75

This method was chosen in the absence of relevant FERC Form 1 filings
in the ISO-NE region and similar data for Independent Power Producers
(IPP). All other existing generators were estimated using the U.S. average
cost for power plants in FERC Form 1 filings.
Under the New England Decarbonization Plans, these low-cost,
reliable natural gas plants would be largely replaced with offshore wind,
onshore wind, solar, and battery storage, by 2050. Figure 19 shows the
‘All-In’ LCOE of new offshore wind, onshore wind, and solar reaches
approximately $436, $240 and $357 per MWh, respectively, in 2050.
Because curtailment rates reach 64 percent by 2050, overbuilding and
curtailment costs are the primary drivers of wind and solar due to the
need to build nearly 6.4 times more capacity than would be needed to
meet peak demand with dispatchable power plants.76 As a result, the cost
of battery storage, overbuilding and curtailing in Figure 19 can be thought
of as a levelized cost of intermittency, or unreliability.
Costs are higher for offshore wind, onshore wind and solar facilities
because grids powered with large concentrations of intermittent wind and
solar resources require greater total capacity and transmission to meet
electricity demand than systems consisting largely of dispatchable power
systems such as traditional fossil fuel and nuclear plants.
47
48
S EC T I O N V I I
Implications for Reliability
R eliability is the most crucial function of the electric grid. Our lives
have never been more dependent upon electronic devices, and it is
highly unlikely that we will be less dependent upon them in the future.
ISO-NE’s 2050 Transmission Study, which found that the modeled
resource mix in the All Options Pathway for electricity demand, when
combined with the resource availability assumptions made by the ISO,
were “insufficient to meet the snapshot loads for the Summer Evening and
Winter Evening Peaks of 2035, 2040 and 2050. The largest observed short-
fall was roughly 12,000 MW in the 2050 57 GW Winter Peak snapshot.”
Thus, within 11 years, ISO-NE may be unable to coordinate electrici-
ty to power the region. How bad could it get? If each of the New England
states adheres to the same renewable-intensive path, a blackout scenario
could be dire indeed.
The New England Decarbonization Plans will seriously undermine
the reliability of the electric grid by making it more dependent on fluctu-
ations in the weather. This dependency will end in blackouts. In contrast,
the current grid maintains the reliability of New England’s electric grid at
a much lower cost.
Our modeling determined the amount of offshore wind, onshore wind,
solar and battery storage capacity needed for the New England Decarbon-
ization Plans by using hourly electricity demand data based on ISO-NE
projections for 2050 demand, and real-world data from the U.S. Energy
Information Administration for onshore wind and solar generation output
in 2023, and offshore wind output from ISO-NE variable energy resource
data for the year 2019.
With these inputs, our model determined that the 66 GW of offshore
wind, 19.2 GW of onshore wind, 68.4 GW of solar, 43 GW of four-hour
battery storage, along with the existing nuclear capacity of 3,356 MW,
4,400 MW of new natural gas capacity built in New Hampshire, and
existing natural gas capacity of 16 GW, and 6,675 MW of electricity im-
ports from neighboring regions, would provide enough electricity to meet
demand for every hour of the year in 2023.
Figure 20 shows electricity demand and supply by type for a hy-
pothetical period in the future stretching from December 14, 2050, to
December 18, 2050. As you can see, offshore wind, onshore wind, solar,
battery storage and New England’s existing nuclear and natural gas
power plants are able to provide enough electricity to meet demand,
shown in the black line.
49

80,000
70,000
60,000
Generation MW
50,000
40,000
30,000
20,000
10,000
0
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12/18/50 20:00
12/18/50 22:00
Offshore Wind Solar Imports Storage Demand
FIGURE 20. Offshore wind, onshore wind, solar, battery storage, nuclear and natural gas are able to meet
electricity demand for every hour of the year 2023.
While our model shows there is enough electricity to meet demand

for every hour of 2023, it is important to remember that this conclusion
is based on just one year’s worth of weather-driven wind and solar gener-
ation data.77 Given that wind and solar generation is subject to weather
patterns, it is important to evaluate whether changes in the weather would
result in a situation where electricity supply could not meet demand — a
capacity shortfall — resulting in rolling blackouts.
50

80,000
70,000
6-hour blackout
60,000
Generation MW
50,000
40,000
30,000
20,000
10,000
0
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12/18/50 16:00
12/18/50 18:00
12/18/50 20:00
Offshore Wind Solar Imports Storage Capacity Shortfalls Demand
FIGURE 21. The resources on the ISO-NE under the New England Decarbonization Plans are unable to meet
electricity demand for every hour of the year, resulting in a 6-hour capacity shortfall in December.
To evaluate the impact of annual changes in wind and solar gener-

ation on the reliability of the grid, AOER obtained capacity factors for
offshore wind, onshore wind and solar from 2019 through 2022 to see if
the amount of installed wind, solar, battery storage, nuclear and natural
gas capacity in the New England Decarbonization Plans would be enough
to meet electricity demand at all hours of every year, regardless of changes
in the weather. The short answer: it would not.
51
The Reliability of the New England Decarbonization Plans

with 2019 Weather
Using 2019 wind and solar generation data from ISO-NE, AOER de-
termined that there would be six total hours of capacity shortfalls through-
out the year, with a maximum capacity shortfall of more than 22,500
MW, which is near the current peak of the ISO-NE system.
Figure 21 shows electricity demand and supply during the same
hypothetical period in the future stretching from December 14, 2050, to
December 18, 2050. As you can see, offshore wind, onshore wind, solar,
battery storage and New England’s existing nuclear and natural gas power
plants are unable to provide enough electricity to meet demand, shown in
the black line, resulting in a six-hour blackout.
The capacity shortfall on December 17, 2050, is caused by low wind
and solar output and insufficient battery storage capacity to store excess
wind generation from previous days — even with more than 170,000
MWh of storage available. During this period, solar capacity factors were
just one percent, onshore wind capacity factors were eight percent and
offshore wind capacity factors were five percent.
The size of the shortfall is significant, with a maximum shortfall of
22,528 MW occurring at 6:00 p.m. on December 17, which is nearly the
current winter peak observed on the ISO-NE system.
These findings are consistent with the ISO-NE 2050 Transmission
Study, which found that the modeled resource mix in the All Options
Pathway, when combined with the resource availability assumptions made
by the ISO, were “insufficient to meet the snapshot loads for the Summer
Evening and Winter Evening Peaks of 2035, 2040 and 2050. The largest
observed shortfall was roughly 12,000 MW in the 2050 57 GW Winter
Peak snapshot.”78
Import Uncertainty
A key component of the ISO-NE decarbonization strategy consists

of importing electricity from New York and Canada during periods of
high demand and low wind and solar output. Our analysis is conservative
because it assumes all 6,675 MW of the existing and planned transmission
projects to import electricity into New England are firm, meaning they
can deliver their full rated capacity at any point when needed.
However, this strategy is fraught with considerable uncertainty be-
cause New York — which is also highly dependent upon natural gas — is
also seeking to decarbonize its electricity supply using intermittent re-
52
sources while achieving high levels of electrification in the transportation

and home heating sectors.79,80
Due to their close proximity, this could mean that New York will expe-
rience high demand at a time when its wind and solar resources, especially
its offshore wind installations located off the coast of New England, are
not producing enough electricity to satisfy its own internal demand, let
alone allow for exports to New England.81
Canadian imports, meanwhile, could also be subject to interruption.
Hydro Quebec (HQ) is the largest exporter into the ISO-NE region, send-
ing significant amounts of power to the New England states in the sum-
mertime.82 This is possible because Quebec, with 71.4 percent of house-
holds using electric heating and heat pumps in 2021, is a winter peaking
system, and ISO-NE is currently a summer peaking system.83
This efficient partnership will face challenges in the years ahead as
ISO-NE becomes a winter peaking system.
In February of 2023, a cold snap enveloped Quebec, causing electric-
ity demand to reach new all-time highs. During this period, HQ demand
reached 42,472 MW, outstripping the installed capacity of 37,200 MW on
the HQ system.84 As a result, HQ had no power to send to New England.
In fact, it was importing power from neighboring regions, including New
York, Ontario and ISO-NE.
Increasing transmission capabilities with Hydro Quebec and New
Brunswick greatly diminish the chances of rolling blackouts in ISO-NE in
the spring, fall and summer months, but the potential for region-wide cold
spells that cause electricity demand to surge will present clear and present
dangers to grid reliability.
To better understand these future risks, additional study of hourly
electricity consumption that reflect observed regional weather patterns
will be necessary to create a more holistic picture of regional electricity
demand and its impact on import availability in the future.
53
54
S EC T I O N V I I I
Emissions Reductions
W hen evaluating energy policies aimed at reducing greenhouse gas

emissions, it is important to weigh the cost of reducing emissions
against the expected benefits of doing so. If the costs of reducing emissions
exceed the expected benefits, the policy does not make sense to enact.
To conduct this cost benefit analysis, policymakers often use a tool
called the Social Cost of Carbon (SCC) to estimate the economic costs, or
damages, of emitting one additional ton of carbon dioxide into the atmo-
sphere.85 While the SCC has serious shortcomings, it can help illustrate
when the costs of a proposed policy obviously outweigh the benefits.86
Figure 22 shows the annual decline in carbon dioxide emissions from
the power sector under the New England Decarbonization Plans.
ISO-NE Annual CO2 Emissions: Electricity,

Transportation, and Home Heating Sectors
150
120
CO2 Emissions (Metric Tons)
90
60
30
0
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
Electricity Transportation Home Heating
FIGURE 22. Under the energy policies of the New England states, carbon dioxide emissions would drop 84
percent from 2022 levels to 21.1 million metric tons by 2050.
55
Biden Social Cost of Carbon vs.

Cost of Reducing CO2 Emissions
$700
$600
Cost of Reducing CO2 Emissions
$500
$400
$300
$200
$100
0
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
Cost per Metric Ton Carbon Dioxide Reduced Biden SCC ($2023)
FIGURE 23. The cost of reducing emissions under the New England Decarbonization Plans vastly exceed
the Biden SCC estimates in every year studied.
Figure 23 shows the cost of reducing each ton of carbon dioxide each
year under the New England Decarbonization Plans and compares it to
the SCC estimates established by the Biden administration.
Figure 23 shows that the cost of reducing carbon dioxide emissions in
the New England Decarbonization Plans exceeds the Biden administra-
tion SCC estimates for every single year. This means the cost of reducing
carbon dioxide emissions under these plans exceeds the benefits of doing
so. In short, the New England states are imposing a net harm on their
economies after accounting for the financial impacts of climate change.
56
57
S EC T I O N I X
ESG’s Impact on New England Utility

Bills and Pension Funds
T he Paris Climate Accords bound national governments to emission

reduction targets that would help transition the global economy to
ensure annual emissions are balanced with nature’s annual sequestration
capacity — a net-zero state. The European Union, Great Britian and Can-
ada have foisted carbon taxes and emissions quotas on their populations to
achieve their net-zero emission reduction obligations. These policies have
forced manufacturers, refiners, businesses and farms to close.87
To date, while American industries have avoided the most
heavy-handed types of climate regulation, activists, companies and state
governments have been stepping up the pressure to adopt Environmental
Social Governance (ESG) internal policies, which will raise heating costs
for consumers and weaken retirement security for state employees.
BlackRock and other climate-focused financial institutions have pres-
sured companies to adopt ESG reporting metrics aiming to harmonize
their operations with America’s Paris Climate Accord net-zero pledge. In
2021, over 95 percent of large, publicly-traded companies were voluntarily
reporting their emissions through ESG reports.88 These reports contain
ESG scores logging total emissions. Low ESG scores brand companies
and businesses with climate risk. Activist pension fund managers will
avoid investing in industries that produce or heavily utilize fossil fuels.
More worryingly, states are beginning to require public pension funds to
weigh climate risk and divest from industries with low ESG scores.
Looking to avoid the criticism associated with low ESG scores, New
England’s major Investor-owned utilities (IOUs) are considering blending
hydrogen into natural gas infrastructure to reduce emissions from their
residential and commercial natural gas services. Blending hydrogen would
render much of the existing natural gas infrastructure obsolete and result
in costly replacements to existing infrastructure. By 2050, the natural gas
service charge would increase up to $1,588.82 per year for the average
New England resident.
State and local pension fund managers are seeing increased pressure
from state and municipal politicians to adopt ESG metrics and completely
divest from fossil fuel companies. Obliging these demands for arbitrary
investment constraints puts pension funds at risk of being unable to make
monthly payments to retirees. The decreased diversity exposes the fund
to more volatile investments. Which if sold for a loss to meet these obliga-
tions, reduces the value of the fund. Maine’s pension fund could be losing
58
more than half a billion in cash dividends paid by their investments in

fossil fuel companies. If Maine’s pension fund serves as a bellwether for
other retirement programs, then New England’s retirees are facing billions
of losses and the potential decline in their pension funds solvency.
ESG Encouraging Premature Regional Hydrogen Rollout
Responding to demands from ESG investors, state politicians and reg-

ulators to reduce their greenhouse gas emissions, utility companies across
New England such as National Grid, Eversource and Constellation, are
considering blending hydrogen with natural gas to reduce emissions from
residential service and power plants.89 Blending hydrogen into the system
would ostensibly reduce CO2 emissions while simultaneously preventing
billions in stranded assets. However, preparing the natural gas distribution
system for hydrogen blending would cost billions of dollars as polyethylene
pipes would need to be upgraded to more expensive and inferior steel
pipes. The average New England resident could expect service charges to
increase between $397 and $1,588 per year.
SEE FIGURE 24. New England Natural Gas Customers90
More than 3.1 million New Englanders rely on natural gas to power
home appliances and heat their homes in the winter. A significant portion
of New England’s natural gas infrastructure was laid in the late 19th and
early 20th centuries. These pipes carried coal- and oil-manufactured gas
to illuminate city streets and businesses in Boston, Hartford, Providence
and dozens of other municipalities across New England.91 When natural
gas arrived in the region via new pipelines in the 1950s, utilities pumped it
through the existing black-iron pipes.92
These century old pipes are causing problems for the New Englanders
who depend on them for natural gas. In 2014, it was estimated that 17
Connecticut Maine Massachusetts New Hampshire Rhode Island Vermont Total
Residential 588,711 35,593 1,790,157 114,313 247,508 48,791 2,825,073
Commercial 62,951 12,524 164,459 19,657 24,636 6,216 290,443
Industrial 2822 171 11,823 191 282 14 15,303
FIGURE 24. New England Natural Gas Customers shows the distribution of New England’s 3.1 million Natural Gas
customers broken down by classification.
59
percent of Massachusetts’ pipeline network was nearing the end of its

useful life. In 2017, Connecticut’s corroded pipelines leaked a significant
quantity of methane across the state.93 Most, if not all, of the century old
pipes would fail the International Fuel Gas Code (IFGC) standards, which
forbid using cast iron pipe, valves, and fittings in systems transporting
gaseous hydrogen.94
High density polyethylene (HDPE) piping has been the primary choice
for utilities replacing cast iron and steel mains since the 1960s. HDPE
service mains last longer and offered superior gas retention than metal
pipes.95 Most importantly, polyethylene pipes are typically 50 to 90 per-
cent cheaper than steel pipelines.96 Funding made available through the
federal 2021 Bipartisan Infrastructure Deal has allowed many local distri-
bution companies (LDCs) to replace their aged pipes with HDPE pipes.97
Unfortunately, HDPE pipelines are likely unsuitable for transport-
ing blended or gaseous hydrogen. Studies have shown when hydrogen is
blended into natural gas, HDPE pipelines leak 1.7 to 5 times more hydro-
gen than steel piping. Under lab conditions, natural gas leaks from HDPE
pipes carrying blending hydrogen doubled. While these losses are eco-
nomically negligible for the utility, the impact of these leaks on a pipeline’s
structural integrity and lifespan are unknown. NREL’s survey of scientific
literature on hydrogen blending concluded that further research needs to
determine the impact on pipeline’s “physical properties, such as density
and degree of crystallinity… [and] the mechanical performance… life-
time of polymer pipes and pipe joints… and effects of hydrogen on specif-
ic resin formulations.”98
If pipelines are weakened by hydrogen blending, the useful life of the
pipelines will be reduced and create safety hazards throughout the net-
work. Given the uncertainty of hydrogen’s impact on HDPE pipes, util-
ities would need to replace all HDPE pipelines with costlier and inferior
steel plumbing.
AOER estimated the cost of upgrading and replacing 25, 50, 75 and
100 percent of New England’s gas transmission network. Given that
HDPE pipes comprise the majority of service mains built and a signifi-
cant portion of vintage infrastructure still in service, the estimated cost of
rolling out hydrogen blending would likely fall in the higher end of these
estimates.
SEE FIGURE 25. New England Gas Infrastructure99
New England has 38,144 miles of natural gas distribution and 26,924
miles of residential service lines spread over six states. Pipelines in Massa-
chusetts and Connecticut account for 77 percent of total pipelines in the
60
Connecticut Maine Massachusetts New Hampshire Rhode Island Vermont Total
Interstate Transmission 591 510 1,133 248 95 74 2651

pipelines
Distribution mains 7,984 1070 21,600 1,070 3,210 3,210 38,144
Service Mains 5,964 494 15,100 494 2,436 2,436 26,924
FIGURE 25. New England Gas Infrastructure shows the milage of pipeline contained in each state.
region. These pipelines typically range from two to 16 inches wide.100

To estimate the cost of replacing natural gas distribution lines, AOER
examined the cost per mile of several natural gas distribution mains in
New England and compared them to estimates from contractors and
other states. Where applicable, these numbers were adjusted for inflation
using the producer price index for finished goods.101
The survey of natural gas pipeline expansions and replacement proj-
ects produced an average per mile cost of $1.851 million/mile (mm/m).102
Costs ranged from $1,100,000 up to $4,565,805 mm/m. The significant
variation was due to the pipeline diameter and materials used.
The estimates for New England projects were in line with the estimates
observed. RSP Gas Piping, a company based in Arizona, estimated costs
at $1.9 mm/m in 2017 ($2.351 mm/m in 2023).103 A 2017 report, Natural
Gas Infrastructure Modernization Programs at Local Distribution Com-
panies, produced by the U.S. Department of Energy found the cost of
replacing natural gas pipelines ranged from one to five million reported
in 2017 dollars.104 Adjusted for inflation, these costs are $1.9 million up to
$9.9 million. The higher end of this estimate likely reflects the costs asso-
ciated with improving natural gas distribution infrastructure within cities.
In 2017, New York City had the highest per mile cost of replacing natural
gas infrastructure ranging from two to eight million.105 Adjusted for infla-
tion, these costs are $2.5-$10.2 million. A 2023 report produced by the
Building Decarbonization Coalition, a coalition advocating for green en-
ergy in buildings, estimated installation cost of natural gas pipeline at $3
mm/m. Salvage costs, taxes and regulated rate of return raised total costs
up to $6,177,000 per mile.106
The cost of replacing natural gas pipelines in Boston, Hartford and
Providence are likely to be higher than replacing aging distribution mains
in smaller towns. For this analysis, we present a low-cost estimate assum-
ing an average cost of $1.975 mm/m.
61
New
% mains replaced Connecticut Maine Massachusetts Rhode Island Vermont Total
Hampshire
25% $3,943 $528 $10,668 $528 $1,585 $1,585 $18,839
50% $7,886 $1,057 $21,336 $1,057 $3,171 $3,171 $37,678
75% $11,830 $1,585 $32,004 $1,585 $4,756 $4,756 $56,517
100% $15,773 $2,114 $42,672 $2,114 $6,342 $6,342 $75,356
FIGURE 26. Cost of Replacing Distribution (in millions) mains shows the cost in millions of preparing New England’s
natural gas transportation network for hydrogen.
New
Hampshire
25% $71 $6 $179 $6 $29 $29 $320
50% $142 $12 $359 $12 $58 $58 $640
75% $213 $18 $538 $18 $87 $87 $960
100% $283 $23 $718 $23 $116 $116 $1,279
FIGURE 27. Material Cost of Replacing Residential Service Lines in New England (in millions) estimates the cost
of replacing residential natural gas service lines in New England. Costs assume $47,520 per linear mile of galvanized
steel pipe. The percentage column provides the assumed scenarios that 10, 50 and 100 percent of residential gas
lines would need to be replaced to accommodate hydrogen-blending.
SEE FIGURE 26. Cost of Replacing Distribution Mains
Total regional cost of replacing distribution mains in New England

ranged from $18 – $75 billion.
Residential service mains are the remaining natural gas pipelines.
These pipelines range from 0.5 up to 1.5 inches107 and carry natural gas
from the distribution mains into homes and businesses. Using a price of
$9 per linear foot,108 AOER estimates that replacing a mile worth of pipe-
line would cost $47,520 per linear mile, excluding labor and other mate-
rials. The total cost of replacing residential service lines in New England
would range from $320 million up to $1.2 billion in pipeline materials
alone.
SEE FIGURE 27. Cost of Replacing Residential Service Lines

in New England
Labor costs were excluded from the estimate given the lack of avail-
able data. A user on City-data.com reported National Grid would lay 100
62
Natural Gas Distribution and Service Main Replacement Costs (in Millions)
New
Hampshire
25% $4,014 $534 $10,847 $534 $1,614 $1,614 $19,159
50% $8,028 $1,069 $21,695 $1,069 $3,229 $3,229 $38,318
75% $12,042 $1,603 $32,542 $1,603 $4,843 $4,843 $57,477
100% $16,056 $2,137 $43,390 $2,137 $6,457 $6,457 $76,635
FIGURE 28. Hydrogen Cost Total presents the total cost of upgrading New England’s distribution and residential
service mains to accommodate hydrogen blended natural gas by state. The total cost of upgrading the system to
carry hydrogen-blended natural gas ranges from $19 – $76 billion.
feet of pipe at no charge and then charge $80 every foot thereafter.109 Cen-
terPoint Energy, a utility based in Texas, offered a similar deal in 2015,
offering to install 75 feet complimentary and then charging an additional
$80 per foot.110 Assuming galvanized steel pipe costing roughly $10 per
foot, the inferred labor price per foot is $70 per foot. At $70 per foot, this
would increase costs by $369,000 per mile, and increase total regional
costs up to $9.9 billion.
SEE FIGURES 28 & 29.
The total cost of preparing New England’s natural gas distribution

network for blended hydrogen ranges from $19 – $76 billion. The amount
that would be carried by ratepayers varies by state and the number of
available customers. Ratepayers in Vermont and Maine would see the
largest increase in their annual base-rate utility bills due to their relatively
small number of natural gas customers. On average, base rates for natural
gas would need to rise between $397 – $1,588 per year dependent on the
amount of infrastructure needing replacement.
While regulators and politicians have advocated for green hydrogen
for years, ESG ratings are providing financial incentive for industries to
make good on the state-mandated regulations. The push for utilities to
adopt hydrogen is just one of the many green technologies IOUs are bank-
ing on to lower their utility bills. Furthermore, an IOUs ability to secure a
regulated seven percent rate of return on installing infrastructure ensures
that they will profit from the replacements, while ratepayers would be the
ones picking up the largest share of the bill.
63
Customers Share by State
% mains replaced Connecticut Maine Massachusetts New Hampshire Rhode Island Vermont
25% $6,133.21 $11,065.55 $5,516.29 $3,982.78 $5,925.77 $29,340.31
50% $12,266.41 $22,131.09 $11,032.59 $7,965.55 $11,851.53 $58,680.61
75% $18,399.62 $33,196.64 $16,548.88 $11,948.33 $17,777.30 $88,020.92
100% $24,532.83 $44,262.19 $22,065.17 $15,931.10 $23,703.07 $117,361.22
Annualized Increase in Service Charge
25% $235.89 $425.60 $212.17 $153.18 $227.91 $1,128.47
50% $471.79 $851.20 $424.33 $306.37 $455.83 $2,256.95
75% $707.68 $1,276.79 $636.50 $459.55 $683.74 $3,385.42
100% $943.57 $1,702.39 $848.66 $612.73 $911.66 $4,513.89
FIGURE 29: Customer share of Hydrogen Cost shows the amount ratepayers share of the bill for upgrading the
natural gas network to carry hydrogen-blended natural gas. Annualized costs assume that utilities will want to achieve
a hydrogen-ready network by 2050 to maintain alignment with Paris Climate Accord’s net-zero target.
State and Local ESG Policy Impact on Pension Funds
Policies aiming to establish ESG investment metrics and ordering

pension funds to divest from fossil fuel companies are becoming more
common at the local and state levels. ESG policies in New England aim to
establish ESG metrics and require pension fund managers to divest from
fossil fuel companies. These policies impose arbitrary restrictions on fidu-
ciaries entrusted with state pension funds.
In addition, several unique policies in the region have emerged in the
states that make it harder for fossil fuel companies to justify investing in
the region. In 2023, Connecticut introduced legislation imposing a five
percent surcharge on all insurance policies issued to fossil fuel producing
and transporting companies. While the original bill died, it has been rein-
troduced in a larger omnibus bill that implements the governor’s budget
recommendations, which is more likely to pass. Though the intended
target of the bill is major fossil fuel companies, local distributors of heating
oil and other natural gas liquid fuels will inadvertently be harmed by this
bill. Meanwhile, Vermont’s Climate Change Cost Recovery Act passed in
May 2024 will appraise the damages caused by storms and then send an
invoice to fossil fuel companies.
Figure 30 provides a list of and summarizes ESG bills enrolled into
New England’s legislatures. Bills that die in committee are typically re-
64
vived in subsequent sessions. For example, HB 2515, which would require

Massachusetts public retirement system to divest from fossil fuel compa-
nies has been reintroduced in every legislative session since the assembly
of the 188th General Court. In Connecticut, S.B. 11 contains provisions
laid out in the dead S.B. 1115. Bills that are currently stuck in committee
and are likely to die this session have been included to make tracking their
future iterations easier.
For this section, AOER examined the impact that fossil fuel divestment
and similar ESG rules can theoretically have on a pension fund. These
policies are prompting a myopic withdrawal from the energy industry
whose dividends support fund managers who require cash on hand to
make monthly payments to pensioners. Using data obtained from Maine’s
2023 fossil fuel divestment report, AOER found that Maine’s pension fund
may lose over $664 million in cash dividends paid by fossil fuel companies
over the next 10 years.
SEE FIGURE 30. ESG Laws in New England111
ESG Metrics and Fossil Fuel Divestment Policies
ESG metrics and fossil fuel divestment policies are functionally the
same. ESG metrics prioritize the net-zero objectives of the Paris Climate
Accords over financial returns and would require fiduciaries to divest from
companies with low ESG scores. With the average fossil-fuel focused com-
pany earning a high ESG score, fiduciaries bound to ESG metrics will be
all but required to eschew investing in fossil fuel companies.112
Fossil fuel divestment policies have popped up throughout New En-
gland over the last decade. Between 2014 and 2024, several municipalities
have required their pension funds to dispense fossil fuel assets.113 In June
2021, Maine became the first state to pass a bill requiring state pension
funds to divest from fossil-fuel companies.114 Only a few months later, on
Nov. 22, 2021 Boston Mayor Michelle Wu signed an ordinance, which she
advocated for while serving as a councilwoman, requiring the city pen-
sions to divest from fossil fuel companies.115 Earlier that year, in June 2021,
Maine became the first state to pass a bill requiring state pension funds to
divest from fossil-fuel companies.116 In June 2024, Vermont became the
second state in New England to adopt a fossil fuel divestment act.
In June 2024, Rhode Island successfully passed a bill binding fiducia-
ries managing state pension funds to government set ESG metrics. While
Massachusetts and Connecticut have had ESG metric bills introduced
into their legislatures, neither has passed it into law. The Massachusetts
65
Date Introduced/
Bills/Public Law Description Signed
Pending Legislation: HB 4819 directs

HB 4819 An Act to mandate the review
fiduciaries to consider “the protection of 8-Jul-24
Massachusetts of climate risk in order to protect public
future social and environmental benefits
pension beneficiaries and taxpayers
(based on HB 2504)
SB 1723 An Act Authorizing Independent Pending Legislation: SB 1723 & HB 2515

Massachusetts Retirement Boards to Divest from Fossil divests Public Funds from Oil and Gas 19-Jan-23
Fuel Companies Companies
SB 1644 An Act relative to Pensions, Pending Legislation: SB 1644 directs

Massachusetts Fiduciary Standards, and Sustainable fiduciaries to consider “the protection of 20-Jan-23
Investment) future social and environmental benefits”
HB 2504 An Act to Mandate the Review Revived Legislation: HB 2504 Requires

Massachusetts of Climate Risk in order to Protect Public pension funds to divest from “climate risk 20-Jan-23
Pension Beneficiaries and Taxpayers investments” by 2026
SB 2610 An Act relative to pensions, Replaced Legislation: SB 1644 establishes

Massachusetts fiduciary standards, and sustainable ESG metrics, replaced by SB 2610 on 20-Jan-23
investing February 8, 2024
Replaced Legislation: SB 1648 prevents

SB 1648 An Act relative to responsible state treasurer from investing retirement 18-Jan-23
Massachusetts corporate investments savings into states that have placed
restrictions on ESG; Replaced by SB 2610
SB 11 An Act concerning Connecticut Pending Legislation: Implements the

Connecticut Resiliency Planning and Providing Governor’s budget recommendations and 8-Feb-24
Municipal options for Climate Resilience revives SB 1115’s surcharge on fossil fuels.
HB 6397 An Act Concerning Zero-Carbon

Dead Legislation: HB 6397 & 6348 would
Emissions & An Act Concerning the 20-Jan-23
Connecticut have directed the State Treasurer to divest
Divestment of State Funds from Fossil Fuel
public pension funds from fossil fuels
Corporations
Dead Legislation: SB 1115 would have

SB 1115 An Act Establishing a Surcharge added a 5% tax onto insurance premiums
Connecticut on Insurance Companies In this State That paid by fossil-fuel companies; This 23-Feb-23
Underwrite Fossil Fuel Companies surcharge was revived in pending SB 11
(Sec. 35)
Dead Legislation: SB 42 would have

SB 42 An Act Concerning the Climate
directed State Treasurer to establish ESG 13-Feb-23
Connecticut Sustainability scores of Companies
metrics to ensure pensions are invested in
Invested in by the State Treasurer
accordance with state climate goals
Public Law: HP 65/LD 99 directs Maine

Maine HP 65/LD 99 Pension funds to divest from fossil-fuel 16-Jun-21
companies
Act 122: Climate Change Cost Recovery Public Law: SB 259 Invoices fossil-fuel 30-May-24
Vermont Act companies for climate damage
SB 42 An act relating to divestment of

Pending Legislation: SB 42/HB 197 directs 26-Jan-23
Vermont State Pension Funds of investments in the
Pension Fund to divest from fossil fuels
fossil fuel industry
SB 7127 An Act Relating to Public Finance

Public Law: HB 7127 & SB 2045 set ESG 26-Jun-24
Rhode Island - Rhode Island Retirement Savings
metrics for state pensions
Program Act
FIGURE 30: ESG Laws in New England show recently considered ESG bills and public laws across New
England.
66
Pension Reserves Investment Management Board (MassPRIM) in Decem-

ber 2022 established an ESG committee to help implement ESG frame-
work for guiding investment decisions.117 In 2023, the committee’s name
was changed to the Stewardship and Sustainability Committee.118 Despite
the name change, the mission of the committee remains unaltered. Even if
bills fail to pass the legislature, climate-conscious bureaucrats are finding
ways to inject ESG metrics and fossil fuel divestment requirements into
state pension funds. These arbitrary restrictions on investment bar fund
managers from investing in energy companies that serve a crucial role in
maintaining pension fund solvency.
ESG’s Impact on Pension Fund Energy Investment Strategy
When Democratic lawmakers met with Maine Public Employee Re-

tirement System (MainePERS) President Rebecca Wyke in March 2024,
the climate-conscious lawmakers sought answers for the pension fund’s
delayed divestment from fossil fuel companies.119 Three years had elapsed
since H.P. 65’s passage and MainePERS still held a significant $1.2 billion
in fossil fuel companies. The policymakers pointed to a scenario provid-
ed in MainePERS’s 2023 divestment report which suggested that a fossil
fuel divested portfolio returned 0.07 percent more than Maine’s current
fossil-fuel burdened portfolio when analyzed over a 25-year period.120 A
similar claim was made by the climate advocacy group Fossil Free Califor-
nia in June 2022, albeit with a significantly larger loss of value. Fossil Free
California asserted that failing to divest from fossil fuels cost California’s
pension fund $17.4 billion in lost revenue between 2010 and 2019.121
These analyses are flawed, however, because they ignore the import-
ant role dividends from fossil fuel companies play in balancing a pension
fund’s monthly obligations to retirees and long-term returns on the funds.
Fiduciaries use the dividends paid by fossil fuel companies and infrastruc-
ture to meet monthly payment obligations to pensioners without having
to liquidate assets with high growth but low cash returns. Legislatively
enforced ESG divestment policies prevent fund managers from fulfilling
their duty by cutting a precious source of cashflow and narrowing fund
managers investment prospects in the energy space.
Globally, pension funds hold $46 trillion in fossil fuel assets.122 As of
October 2023, California State Teachers’ Retirement and Public Employ-
ees’ Retirement Systems held over $9.4 billion in fossil fuel assets.123 This
included $3.9 billion in Exxon Mobil, Chevron, Shell, ConocoPhillips and
British Petroleum stock, and billions more in other fossil fuel investments.124
Despite the backlash from climate activists, fiduciaries managing
pension funds invest in fossil fuel companies for the large dividends rela-
67
tive to other sectors.125 Out of 129 tracked industries, oil and natural gas
midstream and exploration and production companies had the 8th and
14th highest average net profit margins.126 These high net profit margins
directly translate into ample cash dividends.
Fossil fuel companies’ dividends per share can range from six to nine
percent per year.127 Between March 2020 and August 2024, State Street
Global Advisors’ Energy Select SPDR Fund (XLE) — an exchange traded
fund (ETF) comprised of major oil and natural gas companies — dividend
payments returned seven percent per year when annualized.128 ETFs
focused on owning natural gas infrastructure saw similar returns. Tortoise
North American Pipeline Fund (TPYP), an ETF owning stock in North
American pipeline operators, returned an annualized seven percent in
cash dividends between March 2020 and August 2024.129 While Van-
guard’s High Dividend Yield Index Fund does not yield seven percent,
fossil energy companies make up 17.56 percent of its portfolio.130
Placing 8th out of 129 industries based on net profit margins, pipeline
companies are renowned for their high dividends. Their small number of
employees, established customer bases, and stable business model keep ex-
penses low and allow profits to be distributed to stakeholders through high
dividend payments. Many large pension funds are so prepossessed with
the returns from pipeline companies’ business model that fund managers
frequently acquire direct stakes in pipeline infrastructure. In August 2021,
the Ontario Teachers’ Pension Fund owned more than $2 billion in natural
gas pipeline infrastructure.131 In March 2024, Blackrock, the world’s largest
pension fund manager, purchased the Portland Natural Gas Transmission
System (PNGTS) pipeline from TC Energy.132 Direct ownership over pipe-
lines gives pension funds steady cashflow. Funds use revenue from natural
gas infrastructure and cash dividends paid on fossil fuel company shares to
pay pensioners without having to sell off stocks in high-growth sectors.
However, ESG policies are preventing fiduciaries from performing
their duty by banning pension funds ownership of lucrative physical natu-
ral gas infrastructure and equities. To demonstrate the impact on pension
funds, AOER estimated the average return from fossil fuel infrastructure
based on returns to pipeline companies operating in New England and
compared it to Maine’s pension funds desired rate of return.
New England’s three major pipeline service companies are Kinder
Morgan, Enbridge and TC Energy. To demonstrate the impact of ESG
policies on pension funds, AOER compared the returns from New En-
gland’s pipeline companies to the performance of several leading renew-
able energy focused Exchange traded funds — TAN, QCLN, and ICLN.
For further evidence of fossil fuel companies’ high dividend yields, XLE
and TPYP were included in the analysis.
68
FIGURE 31 shows the monthly change in stock prices for the renew-
able energy ETFs (TAN, QCLN, and ICLN), the pipeline ETFs (XLE
and TPYP) and compares them to the stock prices for Kinder Morgan,
Enbridge, and TC Energy from March 1, 2020, through July 1, 2024.
The graph also incorporates cumulative dividend payments made to
shareholders during this time and adds this value to the stock prices to
show the total returns per share for each investment.
Initially, the renewable energy ETFs outperformed every fossil fuel
asset by several orders of magnitude. But after peaking in January 2021,
the prices of the stocks within the TAN, QCLN and ICLN ETFs declined
61 percent, 55 percent and 51 percent respectively. This decline in stock
value was prompted by macro-economic trends that worked against the
economic competitiveness of renewable energy. Aggressive interest rate
hikes by the Federal Reserve, material shortages, global supply chain dis-
locations and American industrial policies increased the cost of building
wind and solar plants.133 By August 2024, renewable energy ETFs total
returns (consisting of the stock prices plus dividends) were nearly equal
with New England’s pipeline companies and well below XLE and TPYP.
Renewable Energy Returns vs.

Conventional Energy Returns134
FIGURE 31. Diversification plays an important role in this portfolio. While

XLE may be the best performing asset as of August 2024, a glut in crude oil
could erode a significant portion of its value. Falling interest rates may cause
solar developers to have improved margins, spurring a recovery in renewable
energy ETFs.
69
SEE FIGURE 32. Total Returns
Over the same period, macro-economic and geopolitical trends

worked in favor of conventional energy producers. The largest compo-
nents of XLE, Exxon Mobil and Chevron, benefited from a spike in oil
prices during 2022. While oil prices have declined, they remained higher
than they were during the Covid years of 2020 and 2021. Oil companies
increased investors’ returns by raising cash dividends and repurchasing
their shares. The appreciation in oil stocks caused XLE to rise 250 percent
since March 1, 2020.
Normally, a prudent fiduciary unconstrained by arbitrary ESG met-
rics or a fossil fuel divestment mandate would be able to hedge both assets
against each other. The fund’s optimal decision throughout 2020 would
have been to channel gains from renewable energy into fossil fuel assets.
With a seven percent cash dividend locked in, the fund manager would
have secured cashflow to help balance payments, freeing up funds that
could be reinvested in higher risk investments. A fund manager consid-
ering the potential of a rate cut, federal subsidies, or other catalyst may
deem it prudent to make a stake in the Renewable ETFs after they’ve
fallen more than 50 percent from their peaks in 2021. ESG metrics and
fossil fuel divestment mandates prevent fiduciaries from exploiting trends
in the energy space that would generate the highest returns. Investment
in the energy space would be limited to clean energy projects. Worse yet,
renewable energy securities fail to offer the same cash return on equity
offered by pipeline and other oil and gas companies (Figure 33, Dividend
Returns).
SEE FIGURE 33: Dividend Returns
Between March 2020 and August 2024, XLE and TYPY returned
over seven percent per year. And Kinder Morgan and Enbridge shares
returned nearly seven percent exactly. The annualized rate of return paid
in dividends alone was seven percent, which is the long run average return
accrued to small business and private capital.135 The renewable energy
ETFs cash dividend returns were significantly lower. When annualized,
the average rate of return paid by renewable energy ETFs was 0.78 per-
cent. Given the choice between a renewable energy ETF and a fixed re-
turn from a pipeline company, a fiduciary would prefer the returns offered
by fossil fuel companies guaranteed seven percent rate of return is equal to
or exceeds the funds discount rate.
Fiduciaries use discount rates to determine the funding ratios. Funding
ratios are a widely used barometer for a fund’s financial health. They are
70
Total Returns
XLE 253%
TPYP 168%
QCLN 83%
Kinder Morgan 88%
Enbridge 72%
TAN 68%
ICLN 60%
TC Energy 29%
FIGURE 32: Total Returns accrued per share from March 2020 – August 2024
Percent Gain from Annualized Return

Initial Share Price Cash Dividends Dividends
XLE $29.06 $12.12 41.69% 8.07%
TPYP $13.58 5.011 37% 7.24%
Enbridge $29.09 $10.44 35.89% 7.07%
Kinder Morgan $13.92 $4.95 35.57% 7.01%
TC Energy $44.30 $12.10 27.31% 5.53%
ICLN $9.55 $0.87 9.08% 1.95%
QCLN $20.05 $0.87 4.34% 0.95%
TAN $25.23 $0.14 0.55% 0.12%
FIGURE 33: Dividend Returns shows the percent return in cash dividends paid by XLE, Enbridge,
Kinder Morgan, TC Energy, ICLN, QCLN and TAN from March 2020 to August 2024.
the net-present value of the assets a fund owns divided by the fund’s total
liabilities over a period of time, typically 30 years.136 Pension fund manag-
ers want cash returns that can match the discount rate. Matching cashflow
with the discount rate allows the fund to balance the fund’s long-run assets
and liabilities, resulting in a healthier funding ratio.
Discount rates used by fund managers typically reflect the rate of
return earned on money invested in small businesses.137 In 2021, state and
local pension fund’s discount rate averaged 7 percent.138 New England’s
pension funds employed similar rates. In 2023, the discount rates used to
71
measure the BRS and Boston Teachers were 6.9 percent and 7 percent
respectively.139 Maine’s local, state, and teacher funds all use a 6.5 percent
discount rate.140 Additionally, these discount rates reflect the fiduciaries
implicit preference for returns, and partly explain why pension funds hold
large positions of fossil fuel companies.
Maine’s pension funds seeking a discount rate of 6.5 percent implies
fund managers are seeking a return on investment — preferably in cash
— of at least 6.5 percent per year. Fossil fuel companies paying 7 percent
offer a superior return on investment. The future cashflows derived from
the dividends alone will be able to keep pace with the lost value from the
funding ratio. Volatile assets, like renewable energy ETFs are inherently
riskier investments for fiduciaries. When the value of renewable energy
ETFs decline, there is no cashflow to mitigate the impact on the fund-
ing ratio. Total asset value will decline with the share price, lowering the
funding ratio.141
Impact on Maine’s Pension Fund
After 2021 legislation, Maine Public Employee Retirement System

began the process of divesting from fossil fuel companies. While the law
instructed the pension fund to divest from fossil fuels by 2026, aggressively
unwinding investments would be financially irresponsible. According to
MainePERS 2023 divestment report, the state employee pension fund still
holds $1.2 billion in fossil fuel assets which comprise 6.5 percent of the
fund.142
Given Maine’s funds goal of earning a return of 6.5 percent and
the high dividends paid by the fossil fuel industry, AOER assumes that
Maine’s pension funds current investments in fossil fuel companies gener-
ate at least 6.5 cash dividend return per year. If Maine continues to divest
from fossil fuels at a rate of 6.5 percent per year, Maine will be able to
completely divest by 2033. In that time, the total value of lost cash div-
idends from the energy sector would be $146.45 million (FIGURE 35:
MainePERS Fossil Fuel Divestment Schedule).
SEE FIGURE 34: Maine Divestment Continues at Trend

of 6.5% Impact on Cash Dividends
However, if MainePERS accelerates divestment to maintain compli-

ance with H.P. 65’s complete divestment target of 2026, then MainePERS
stands to lose a much larger sum of money. By 2033, Maine will likely
have foregone over $665 million in dividend income from fossil fuel com-
panies. (See Figure 35)
72
Fossil Fuel Investments Energy Dividends Foregone Dividends

(millions) (millions) (millions)
2022 $1,408 $99 $0
2023 $1,215 $85 $13
2024 $1,139 $80 $19
2025 $1,000 $70 $29
2026 $823 $58 $41
2027 $634 $44 $54
2028 $458 $32 $66
2029 $310 $22 $77
2030 $197 $14 $85
2031 $117 $8 $90
2032 $65 $5 $94
2033 $34 $2 $96
Total $518.05 $664.50
Lost Funds $146.45
FIGURE 34. MainePERS Fossil Fuel Divestment Schedule shows the

total lost dividends from fossil fuel companies as Maine PERS continues its
divestment plan. Values for 2024 – 2033 were estimated using 2023’s rate of
divestment 6.5 percent.
SEE FIGURE 35. Maine Divestment After 2021 Legislation
Pipeline infrastructure and fossil fuel companies are not Maine’s pen-
sion fund’s only source of cash revenue. Investments in real estate invest-
ment trusts (REITs) and preferred stock can offer equal or even higher
dividends. However, overinvesting in one asset class narrows the focus
of the fund, increasing exposure to investment risk. Without increasing
investment, MainePERS could replace the $665 million in dividends by
increasing employee contribution rates. However, this would take more
pay out of civil servant’s monthly income.
Furthermore, divesting from fossil fuels will reduce fiduciaries’ abil-
ity to diversify within the energy space. Under these policies, fiduciaries
distributing funds among assets in the energy space will be pigeonholed
solely into renewables. Furthermore, the cash return on investments will
be lower. By reducing the variety of investments, fund managers will be
overweight in other sectors to compensate.
73
Fossil Fuel Investments Energy Dividends Foregone Dividends

(millions) (millions) (millions)
2022 $1,408 $99 $0
2023 $1,215 $85 $13
2024 $737 $52 $47
2025 $271 $19 $80
2026 $61 $4 $94
2027 $0 $0 $99
2028 $0 $0 $99
2029 $0 $0 $99
2030 $0 $0 $99
2031 $0 $0 $99
2032 $0 $0 $99
2033 $0 $0 $99
Total N/A $258.42 $924.13
Lost
$665.71
Dividend
FIGURE 35. MainePERS Fossil Fuel Divestment Schedule shows the

total lost dividends from fossil fuel companies as MainePERS continues
its divestment plan. Values for 2024 – 2026 were estimated assuming a
divestment rate of 50 percent per year with a complete exit from fossil fuel
assets by January 1, 2027, maintaining compliance with H.P. 65.
Finally, ESG metrics and investment policies will prevent fossil fuel
companies from financing the construction of new pipelines in the region.
Should New England’s net-zero plans fail to materialize, the region will
see increased dependency on natural gas and in-home heating. Under
normal circumstances, a pension fund could purchase stakes or deben-
tures to help finance the construction of a new pipeline. However, ESG
blocks the flow of funds from pension funds to pipeline companies and
prevents cheap natural gas from flowing into the region.
ESG’s arbitrary restrictions are preventing pension fund managers
from investing in assets that would yield the highest return possible in a
diversified portfolio. As cities and states throughout New England contin-
ue to adopt these arbitrary limits, pension funds will be leaving billions
in cash dividends on the table while simultaneously subjecting funds to
higher volatility and risk.
74
Conclusion
Compliance with the New England Decarbonization Plans would cost

$815 billion through 2050. New England families would see their electric
bills increase by an average of nearly $99 per year. Commercial businesses
would see their costs increase by $489 per year. Industrial (manufacturing)
customers would see their electric bills increase by an average of almost
$5,280 per year.
The costs incurred in the New England Decarbonization Plans are
driven by a massive buildout of solar panels, offshore wind turbines, on-
shore wind turbines and transmission lines, in addition to the costs asso-
ciated with higher taxes, generator profits and the cost of building battery
storage facilities to provide power when the sun is not shining or the wind
is not blowing.
While adding power plant capacity to the grid may sound like a good
thing, increasing capacity merely to meet green energy mandates, rather
than meeting electricity demand, is an unnecessary cost that will harm
New England families and the region’s economy.
Other states are tacitly admitting that the plans for a net zero grid will
leave many vulnerable. Colorado’s Department of Health Care Policy and
Financing (HCPF) is giving away battery backup supply systems to Medic-
aid recipients who are dependent on medical equipment with an internal
battery life of 2-4 hours. Even if New England were to follow suit, the
free batteries are only expected to last 12 hours, shorter than the 18-hour
blackout scenario described in this study.143 144
Simultaneously, adoption of ESG policies to introduce hydrogen
blending into natural gas would raise the costs of heating for the many
New England households dependent on the fuel to heat their homes.
In the end, the idea that New England can use policies based on net
zero and ESG promises to heat and power the region is a dangerous and
unserious proposition.
75
Always On Energy Research. AOER believes every

resident in every state has the right to know how much
energy policy passed at local, state, and federal levels will
cost them in terms of standard of living, including mone-
tary and reliability.
The Ethan Allen Institute’s mission is to influence public

policy in Vermont by helping its people to better under-
stand and put into practice the fundamentals of a free
society: individual liberty, private property, competitive
free enterprise, limited and frugal government, strong
local communities and personal responsibility.
Josiah Bartlett Center for Public Policy. The mission of

the Josiah Bartlett Center for Public Policy is to develop
and advance practical, free-market policies that promote
prosperity and opportunity for all in New Hamphire.
Maine Policy Institute is a nonprofit, nonpartisan

organization that works to expand individual liberty and
economic freedom in Maine. Maine Policy is the strongest
voice in Augusta for taxpayers and believes in an open,
transparent, and accountable state government.
The Rhode Island Center for Freedom and Prosperity is

dedicated to providing concerned citizens, the media, and
public officials in Rhode Island with empirical research
data, while also advancing market-based solutions to
major public policy issues in the state.
Yankee Institute is the eyes, ears and voice for hard-

working people who want a prosperous Connecticut.
Our common-sense solutions drive positive legislative
results to strengthen our communities and build a vibrant,
hopeful future.
American for Prosperity Foundation. We believe in

people. When Americans have freedom and opportunity,
they can achieve extraordinary things. At Americans
for Prosperity Foundation, we empower and educate
Americans on the proven and principled solutions to our
country’s most challenging issues.
The Fiscal Alliance Foundation is focused on increasing

public awareness regarding the benefits of greater
fiscal responsibility, transparency, and accountability
in state government. The organization also engages in
legal challenges related to measures that involve the
public at large and of private citizens when their rights
are abridged by the absence of a fiscally responsible,
transparent, and accountable government.
76
Isaac Orr is a founder and Vice President of Research

at Always On Energy Research, where he conducts
energy modeling and writes about energy and
environmental issues, electricity policy, and natural
resource development. His writings have appeared
in The Wall Street Journal, USA Today, the New York
Post, The Hill, and many other publications. He and
his colleague Mitch Rolling have modeled the cost
and reliability impacts of Environmental Protection
Agency regulations in the Midcontinent Independent
Systems Operator and Southwest Power Pool.
They have also evaluated the cost and reliability
implications of energy policies in more than twelve
states. Isaac grew up on a small family dairy farm
in Wisconsin, so he cares deeply about the issues
affecting rural America.
Mitch Rolling is a founder, and Director of Research

at Always On Energy Research, where he models
energy proposals, analyzes the energy industry
and electricity policy, and writes about energy and
environmental issues. His research has been featured
in publications such as The Wall Street Journal and
Forbes. Mitch and his colleague Isaac Orr co-authored
an award-winning report highlighting the impact of
Minnesota’s 50 percent renewable energy proposal
and have designed several energy models to analyze
the impact of energy proposals in twelve states and
Environmental Protection Agency regulations in
the Midcontinental Independent System Operator
(MISO) and Southwest Power Pool (SPP). Mitch
graduated from the University of Minnesota in 2018
with a bachelor’s degree in history, and he earned an
MS in Finance and Economics at West Texas A&M
University in 2022.
77
Appendix
Annual Average Additional Cost Per Customer. The annual average

additional cost per customer was calculated by dividing the average yearly
expense of the New England Decarbonization Plans by the number of
electricity customers in the region.145 This methodology is used because
rising electricity prices increase the costs of all goods and services. Busi-
nesses will pass these additional costs onto consumers, effectively increas-
ing the cost of everything. Therefore, this method helps convey the total
cost of the plans for New England households in a way that is more rep-
resentative than calculating the costs associated with higher residential
electric bills.
Annual Average Rate Per Customer Class. The annual average addi-
tional cost per residential, commercial and industrial rate class customer
was calculated by applying the overall cost per kWh of New England
decarbonization plan compliance during the time horizon of the study to
rate classes based on historical rate factors in New England. Rate factors
are determined by the historical rate ratio (rate factor) of each customer
class.
For example, electricity prices for residential, commercial and indus-
trial rate classes in New England were 28.72, 19.23 and 15.80 cents per
kWh in 2023, respectively. Based on general electricity prices 22.78 cents
per kWh, residential, commercial and industrial rates had rate factors of
1.26, .84 and .69, respectively. This means that, for example, residential
customers have historically seen electricity prices 26 percent above general
rates. This analysis continues these rate factors to assess future rate im-
pacts for each rate class.
Assumptions for Levelized Cost of Energy (LCOE) Calculations.
The main factors influencing LCOE estimates are capital costs for power
plants, annual capacity factors, fuel costs, heat rates, variable operation
and maintenance (O&M) costs, fixed O&M costs, the number of years the
power plant is in service, and how much electricity the plant generates
during that time, which is based on the capacity (MW) of the facility and
the capacity factor.
LCOE values for existing natural gas generators were estimated using
historical construction costs based on the average plant life of each energy
source and current variable and fixed operation and maintenance (O&M)
expenses. This method was chosen in the absence of relevant FERC Form
1 filings in the ISO-NE region and data similar for Independent Power
Producers (IPP). All other existing generators were estimated using the
U.S. average cost for power plants in FERC Form 1 filings.
78
These LCOE values are inserted into the model and adjusted annually
based on annual capacity factors for existing resources.
LCOE values for new power plants were calculated using data values
presented in the Capital Cost and Performance Characteristics for Utili-
ty Scale Electric Power Generating Technologies for the Annual Energy
Outlook 2025.146 These values are held constant during the model run.
The cost of repowering power facilities that need it at the end of their
useful lives is accounted for in each value. These values are described in
greater detail in the following subheadings:.
1) Capital Costs, and Fixed and Variable Operation and Maintenance
Costs Capital costs and expenses for fixed and variable O&M for new
offshore wind, onshore wind, solar and battery storage were obtained
from the Capital Cost and Performance Characteristics for Utility Scale
Electric Power Generating Technologies for the Annual Energy Outlook
2025.147 Region 7 capital costs were used, and national fixed and variable
O&M costs were obtained from the Capital Cost and Performance Char-
acteristics for Utility Scale Electric Power Generating Technologies for the
Annual Energy Outlook 2025 report.148
2) Unit lifespans Different power plant types have different useful
lifespans. Our analysis takes these lifespans into account for our Levelized
Cost of Energy analysis.
3) Onshore and offshore wind turbines last 20 years Federal LCOE
estimates seek to compare the cost of generating units over a 30-year time
horizon.149 This is problematic for wind energy LCOE estimates because
the National Renewable Energy Laboratory reports the useful life of a
wind turbine is only 20 years before it must be repowered. Our analysis
corrects for this error by using a 20-year lifespan for wind projects before
they are repowered and need additional financing.
4) Solar panels last 25 years Our analysis uses a 25-year lifespan for
solar because this is the typical warranty period for solar panels. These fa-
cilities are rebuilt after they have reached the end of their useful lifetimes.
5) Battery storage lasts 15 years Battery storage facilities are expected
to last for 15 years. Battery facilities, like wind and solar, are rebuilt after
reaching the end of their useful lifetimes.
6) Fuel cost assumptions Fuel costs for existing power facilities were
estimated using the most recent estimates from the ISO-NE 2023 Internal
Market Monitor Report.150
7) Nuclear fuel costs Fuel costs for existing nuclear plants were as-
sumed to be $6.35 per MWh, which was the latest available price accord-
ing to EIA.
8) Natural gas fuel costs Existing natural gas prices were assumed to
be $3/mmBTu based on data obtained from the ISO-NE 2023 Internal
79
Market Monitor Report.151 We held this fuel cost constant through 2050.
9) Coal fuel costs Existing coal fuel cost assumptions of $22.09 per
MWh were based on 2020 FERC Form 1 filings.
10) Levelized Cost of Transmission, Taxes, and Transmission Lines
This report calculated the additional levelized transmission, property and
income tax, and utility profit expenses resulting from each new power
source during the course of the model and according to the additional
capacity in MW installed and generation in MWh of that given source.
Capacity installed is used to determine capital costs and additional ex-
penses (transmission, state taxes and generator profits) of each electricity
source over the course of its useful lifespan.152
Assumptions for Levelized Cost of Intermittency (LCOI) Calculations.
This report also calculated and quantified the levelized cost of intermit-
tency (LCOI) for offshore wind, onshore wind and solar energy on the
entire energy system. These intermittency costs stem from the need to
build backup battery storage facilities to provide power during periods of
low wind and solar output, which we call “battery storage costs,” in this
report and the need to “overbuild and curtail” wind and solar facilities to
limit the need for battery storage. It is important to note that these costs
are highly system specific to the mix of resources being built and operated
in any given area.
1) Battery storage costs We calculate battery storage costs by determin-
ing the total cost of building and operating new battery storage facilities
to meet electricity demand during the time horizon studied in the New
England Decarbonization Plans. These costs are then attributed to the
LCOE values of wind and solar by dividing the cost of load balancing by
the generation of new wind and solar facilities (capacity-weighted).
Attributing battery storage costs to offshore wind, onshore wind and
solar allows for a more equal comparison of the expenses incurred to
meet electricity demand between non-dispatchable energy sources, which
require a backup generation source to maintain reliability, and dispatch-
able energy sources like coal, natural gas and nuclear facilities that do not
require backup generation.
2) Overbuilding and curtailment costs The cost of using battery stor-
age for meeting electricity demand during periods of low wind or solar
output is prohibitively high, so many wind and solar advocates argue
that it is better to overbuild renewables, often by a factor of five to eight
compared to the dispatchable thermal capacity on the grid, to meet peak
demand during these low wind and solar periods. These intermittent re-
sources would then be curtailed when wind and solar output improves.
As wind and solar penetration increase, a greater portion of their out-
put will be curtailed for each additional unit of capacity installed.153
80
This “overbuilding” and curtailing vastly increases the amount of

installed capacity needed on the grid to meet electricity demand during
periods of low wind and solar output. The subsequent curtailment during
periods of high wind and solar availability effectively lowers the capacity
factor of all wind and solar facilities, which greatly increases the cost per
MWh produced.
Our model indicated there would be large periods of curtailment in
the future grid due to the large capacity additions of offshore wind, on-
shore wind, and solar resources. This is consistent with the findings of the
ISO-NE 2021 Economic Study: Future Grid Reliability Study Phase 1:
“On high-renewable days, typically during the spring or fall seasons,
there is a large amount of both offshore wind and PV, which leads to large
amounts of curtailment. During peak solar output hours, we observed
that even with simultaneous charging of Battery Energy Storage System,
pumped storage, and EV Flex (as explored in Alternative B), and external
tie-lines exporting at their limits, there was more than 15.4 GWh of en-
ergy that needed to be curtailed in a single hour. The system was unable
to capture this renewable energy for use at a later time due to insufficient
storage (600 MW of BESS plus existing pumped hydro storage). The
system would require increased energy storage capability to utilize this
curtailed, renewable energy.”154 “Regardless of the specific gas type in
use, the Future Grid Reliability Study analysis shows immense amounts of
renewable energy curtailment in most cases, but particularly in aggressive
electrification and renewable deployment cases.”
Annual curtailment levels for this model were estimated based on
hourly load forecasts and were found to reach up to 64 percent of total
wind and solar generation by the end of the model. (See Figure 36)
81
FIGURE 36. Curtailment increases to nearly 64% by 2050 as more

intermittent generation is brought online.
Rising rates of curtailment stemming from the overbuilding of the grid

effectively lower the capacity factor of all generating resources on the grid,
thereby increasing the levelized cost of energy, which is a calculation of
power plant expenses divided by the generation of the plant.
3) Coincident peak load Our analysis assumed coincident winter peak
periods of demand because the 2050 Transmission Study found for winter
periods, each state in New England was at or near its own peak load while
New England as a whole was at its overall peak load, so a single snapshot
in time captured worst-case or near-worst-case conditions in all six states.
4) Cost of compliance modeling This analysis utilizes cost of compli-
ance modeling to determine the cost of the electric system in New En-
gland. This approach, which does not consider the impact of the resource
portfolio on wholesale prices, is appropriate because most large-scale wind
and solar facilities are procured through state-sponsored long-term con-
tracts.
As the system becomes more saturated with these non-dispatchable
resources, it is unclear whether the markets will be able to produce the
necessary incentives to keep dispatchable units online, resulting in a
circumstance where these generators are issued reliability payments to
remain available for periods of peak demand. As result we assumed gener-
ators would secure contracts to recoup their capital costs plus a return of
7.05 percent.
5) Electricity consumption assumptions Our model estimates electric-
82
ity consumption in 2050 using the projected hourly load shape for 2033
and monthly peak demand for 2050 (see Figure 37). Electricity consump-
tion is incrementally increased every year from 2024 to 2050 to arrive at
this consumption level, which was more than 244 million MWhs in 2050.
6) Energy storage dispatch Energy storage is assumed to be saved for
periods of high demand with low wind and solar output. This differs from
modeling exercises performed by ISO-NE, where storage facilities are as-
sumed to use locational marginal price (LMP) arbitrage to determine when
these resources would be economically dispatched. For each day modeled,
the energy storage algorithm forecasted one week ahead to find opportune
times to charge and discharge energy and maximize profitability.
This decision was made because using storage systems to capture
higher prices during via arbitrage would often lead to situations where the
energy storage was depleted before a period of wind and solar drought to
following week, leaving the system short of energy.
7) Export Income Assumptions As ISO-NE increases the installed
capacity on its system, there is an opportunity to sell electricity to neigh-
boring regions, including Hydro Quebec, New Brunswick and New York.
However, our analysis did not account for these potential export revenues.
One complication in calculating these revenues is the large uncertain-
ty of wholesale power prices in the coming decades. Larger penetrations
of zero-marginal cost wind and solar resources will ultimately drive down
wholesale power prices during periods of strong wind and solar pro-
duction. This will reduce the prices of potential exports to neighboring
regions, who can purchase low cost, or even negatively priced electricity,
reducing the revenues obtained by wind and solar generators.
In contrast, periods of low wind and solar output will cause wholesale
prices to rise, thus increasing the cost of imports into ISO-NE. This may
create a “buy high, sell low” dynamic for electricity prices on ISO-NE
system in the coming decades.
Hourly Load, Capacity Factors and Peak Demand Assumptions
The hourly load shape used in our modeling was extrapolated using
ISO-NE projected load shapes for 2033 and projected monthly peak
demand in 2050. This resulted in a peak demand of 57 GW in Decem-
ber 2050. New Hampshire electrification was then taken out of this load
shape, assuming the state would not electrify motor vehicles and continue
to use natural gas for home heating. This resulted in a peak demand of
roughly 52.5 GW.
Hourly output from intermittent generating resources, such as on and
offshore wind and solar, were derived from the U.S. Energy Information
Administration (EIA)155 and ISO-NE variable energy resource (VER)
data.156
83
FIGURE 37 shows the difference between the historical 2023 hourly

demand in ISO-NE and projected 2050 hourly demand after load growth and
electrification efforts.
1) Impact on electricity rates The table below shows annual addition-

al electricity rates by customer class using the cost of the New England
Decarbonization Plans and adjusting for the rate factor described above in
cents per kWh.
84
FIGURE 38. Impact of New England decarbonization plan on electric rates.
2) Imports Our analysis assumed all of the transmission lines in the 2050
Transmission Study would be operational. These consist of:
1,000 MW imported from New Brunswick over existing 345 kV AC ties.
1,850 MW imported from New York over the existing 345 kV, 230 kV,
115 kV and 69 kV AC ties.
1,400 MW imported from Quebec over the existing Phase II HVDC tie
(interconnected at Sandy Pond substation in Ayer, Massachusetts).
225 MW imported from Quebec over the existing Highgate HVDC
back-to-back converter (interconnected in Highgate, Vermont).
1,200 MW imported from Quebec over the under-construction New
England Clean Energy Connect HVDC tie (interconnecting at Larrabee
Road substation in Lewiston, Maine).
1,000 MW imported from Quebec over a hypothetical new HVDC tie
between Quebec and Vermont (assumed to interconnect at the Coolidge
substation in Cavendish, Vermont).
However, we assumed that ISO-NE would have 1,800 MW of firm
import capacity in 2050 except when Hydro Quebec needs to meet its
domestic demand. Given the changing peak demand seasons for ISO-NE,
this analysis used real-time electricity demand data from Hydro Quebec
85
to determine if there would be enough power plant capacity on the HQ

system to meet its domestic needs. If there was not, exports to ISO-NE
were curtailed.
The cost of imports from Hydro Quebec was assumed to be 7.5 cents
per kWh based on the most recent annual report published by Hydro
Quebec.157
3) No “Load Modifying Resources” Our model does not allow for the
use of Load Modifying Resources (LMRs) or demand response (DR) in
determining how much reliable capacity will be needed to meet peak elec-
tricity demand in the New England Decarbonization Plans.
Instead, battery capacity and excess wind and solar capacity is built
to provide enough power to supply ISO-NE’s electricity needs under the
Decarbonization Plans at all times based on a test year using historical
generation in ISO-NE in 2023, and hourly capacity factors for wind and
solar from the EIA Electric Grid Monitor and ISO-NE VER d.158 Battery
storage capacity was assumed to be 95 percent efficient and fully charged
at the start of the test year.
We acknowledge that voluntary LMRs and DRs can play a role in op-
timizing system cost and reliability. However, we believe that DR resourc-
es are being inappropriately used by many wind and solar special interest
groups to manipulate their models to unrealistically reduce the amount of
capacity needed to meet peak demand, and thus artificially suppress the
cost of their proposals. In this way, these groups are essentially manipulat-
ing the amount of capacity needed to meet current electricity demand and
not providing an apples-to-apples comparison of the cost. Their proposals
will effectively place more responsibility on behalf of the customer to keep
the grid online.
4) New Hampshire electricity demand Because New Hampshire has
not adopted deep decarbonization policies, this analysis projects that the
state will continue to utilize conventional energy sources such as natural
gas and heating oil for home heating, and internal combustion engines.
This serves to reduce the observed peak load on the ISO-NE system.
New Hampshire’s peak load reduction was calculated by taking the
difference of New Hampshire’s projected demand for electrification and a
constant growth of New Hampshire demand based on historical growth
rates of 1.25 percent. This difference was subtracted out of the hourly load
shape to account for New Hampshire’s energy policy that does not include
electrification efforts seen in other states.
5) Nuclear relicensing All existing nuclear power plants were assumed
to remain operational through the model run. This assumption greatly
reduced the need for new onshore wind, offshore wind, solar and battery
storage resources and maintains system reliability.
86
This was demonstrated in the ISO-NE 2021 Economic Study: FIG-

URE Grid Reliability Study Phase 1, where retiring the existing nuclear
power plants resulted in massive blackouts in the region, with customers
losing power for 79 hours throughout the year, peaking at 6,160 MWh
(19.7 percent of load) unserved energy during a single hour. The ISO-
NE 2021 Economic Study: FIGURE Grid Reliability Study Phase 1 also
found the retirement of nuclear units led to an increase in carbon dioxide
emissions of up to 50 percent.
6) Nuclear restrictions Maine and Connecticut will maintain a mora-
torium until the identification of a demonstrable technology or a means
for high level waste disposal or reprocessing is found.159 Connecticut in
2022 passed legislation allowing for new reactors to be sited at the existing
nuclear facility located in the state.160
Meanwhile, Massachusetts, Rhode Island and Vermont prohibit new
nuclear power plants unless they are approved by the state legislature.161
Maine and Massachusetts also require voter approval for new reactors.162,163
7) Offshore wind costs This analysis uses the capital cost, and opera-
tions and maintenance cost assumptions in the U.S. EIA’s Capital Cost
and Performance Characteristics for Utility-Scale Electric Power Gener-
ating Technologies, a capacity factor of 50 percent, a 20-year useful life,
and an assumed weighted average cost of capital of 7.6 percent.164
Using these assumptions, we calculated an unsubsidized levelized cost
of energy of $149 dollars per MWh for new offshore wind (See Figure
39). These estimates are nearly identical to the subsidized costs of offshore
wind projects signed in New York, which were $150 per MWh.
FIGURE 39. This figure shows the unsubsidized Levelized Cost of Energy
used as our “base cost” calculation in our model, which is more conservative
than the contracts currently being signed in New York that include the federal
Investment Tax Credit.
87
As a result, our cost assumptions were generous to the offshore wind

industry because we used the more optimistic capital costs in EIA’s latest
capital cost estimate guide, rather than the costs of power purchase agree-
ments for offshore wind in New York.
These costs differ from those shown in Figure 19 because not all of the
offshore wind facilities have not reached the end of their useful lives, and
therefore the costs are being divided over fewer megawatt hours.
8) Plant Construction by Type This analysis assumes no new car-
bon-dioxide emitting power plants will be built outside of New Hamp-
shire, where the total installed capacity of natural gas power plants is
roughly 5,650 MW. Existing natural gas capacity is assumed to remain
online but operate at low-capacity factors in the remaining five states.
Under the New England Decarbonization Plans, states would add
offshore wind, onshore wind, solar facilities, battery storage capacity and
build new transmission lines to reduce emissions, consistent with the 2050
Transmission Study assumptions.
9) Plant Retirement Schedules Our model uses retirement assumptions
from the 2050 Transmission Study, where all coal, oil, diesel, and municipal
solid waste-fueled generators, as well as a portion of today’s natural gas-fu-
eled generation were retired by 2035. For our analysis, existing steam
turbine gas plants were retired while others remained in service and were
repowered as needed to keep online.
The remainder of today’s natural-gas-fueled generation, as well as
biomass, nuclear, hydroelectric, and renewable generators, were assumed
to remain operational through 2050.
10) Time Horizon Studied This analysis studies the impact of the New
England Decarbonization Plans on electricity prices from 2024 to 2050.
This time horizon is examined because like a mortgage, power plants
owners pay off the cost of the plant each year, meaning decisions made
today will affect the cost of electricity for decades to come. As such, the to-
tal costs highlighted by this study do not represent the total costs incurred
by the New England Decarbonization Plans, but rather the total cost that
electricity customers would pay off through 2050.
11) Transmission ISO-NE estimates rising peak demand will cost
roughly $750 million per gigawatt (GW) of load added from 28 GW to 51
GW, and roughly $1.5 billion per GW from 51 GW to 57 GW.165
ISO-NE notes the New England grid with 100 percent heating and
transportation electrification is expected to result in a peak load of around
57 GW, but a lower peak load could be achieved if less electrification of
the transportation and home heating sectors.
In our analysis, New Hampshire serves to reduce peak load by 4.5
GW by continuing to heating homes with natural gas and fuel oil and by
88
continuing to use internal combustion engines.166,167

12) Wind and Solar Degradation According to the Lawrence Berke-
ley National Laboratory, output from a typical U.S. wind farm shrinks
by about 13 percent over 17 years, with most of this decline taking place
after the project turns ten years old. According to the National Renewable
Energy Laboratory, solar panels lose 1 percent of their generation capaci-
ty each year and last roughly 25 years, which causes the cost per megawatt
hour (MWh) of electricity to increase each year.168 However, our study
does not take wind or solar degradation into account.
89
Endnotes
1 The five states with the emissions reduction goals described here are Connecti-
cut, Maine, Massachusetts, Rhode Island, and Vermont.
2 ISO New England, “2050 Transmission Study,” ISO New England Inc. Transmis-
sion Planning, February 12, 2024 https://www.iso-ne.com/static-assets/docu-
ments/100008/2024_02_14_pac_2050_transmission_study_final.pdf.
3 US Office of Energy Efficiency and Renewable Energy. https://www.energy.gov/
eere/articles/how-much-power-1-gigawatt
4 Federal Reserve Bank of St. Louis. “Gross Domestic Product: All Industry Total in
the New England BEA Region.” https://fred.stlouisfed.org/series/NENGNQGSP
5 NY Environment and Health Data Portal. https://a816-dohbesp.nyc.gov/Indica-
torPublic/data-stories/poweroutages/
6 Energy Information Administration, “Table 1. State energy-related carbon dioxide
emissions by year (1970–2021)” https://www.eia.gov/environment/emissions/
state/
9 U.S. Department of Energy, “What is a Nuclear Moratorium?” Office of Nuclear
Energy, October 26, 2023, https://www.energy.gov/ne/articles/what-nucle-
ar-moratorium#:~:text=Minnesota%20has%20banned%20new%20reac-
tor,%2C%20Suffolk%2C%20and%20Queens%20counties..
10 See Nuclear Restrictions in the Appendix.
11 State of Connecticut, “Governor Lamont Signs Ket Climate Change and Energy
Legislation Codifying into Law His 2040 Zero-Carbon Target and Expanding
Existing Renewable Energy Programs,” Press Release, May 17, 2022, https://
portal.ct.gov/office-of-the-governor/news/press-releases/2022/05-2022/gov-
ernor-lamont-signs-key-climate-change-energy-legislation#:~:text=Public%20
Act%2022%2D5%20(Senate,3)..
12 State of Connecticut, “Senate Bill No. 10, Public Act No. 22-5,” https://www.cga.
ct.gov/2022/ACT/PA/PDF/2022PA-00005-R00SB-00010-PA.PDF.
13 Connecticut Department of Economic and Community Development, “Connecti-
cut’s Offshore Wind Strategic Roadmap,” October 2023, https://portal.ct.gov/
offshorewind/-/media/offshorewind/state-of-connecticut-osw-strategic-road-
map-2023.pdf.
14 CT Mirror. “CT opts out — for now — of offshore wind, raising concerns about mo-
tives.” https://ctmirror.org/2024/09/15/connecticut-misses-offshore-wind-so-
licitation/
15 Advance Connecticut, “The Renewable Energy Industry is Growing in Connecti-
cut,” Accessed July 17, 2024, https://www.advancect.org/our-economy/key-in-
dustries/renewable-energy/.
16 State of Maine, “Governor Mills Signs Major Renewable Energy and Climate
Change Bills Into Law,” Office of Governor Janet T. Mills, June 26, 2019, https://
www.maine.gov/governor/mills/news/governor-mills-signs-major-renewable-en-
ergy-and-climate-change-bills-law-2019-06-26.
90
17 State of Maine, “Maine Energy Plan: Pathway to 2040,” Governor’s Energy Office,
Accessed July 17, 2024, https://www.maine.gov/energy/studies-reports-work-
ing-groups/current-studies-working-groups/energyplan2040#:~:text=The%20
%E2%80%9CMaine%20Energy%20Plan%3A%20Pathway%20to%20
2040%E2%80%9D%20process%20intends,strengthening%20Maine’s%20
clean%20energy%20economy..
18 Governor’s Energy Office, “Maine Energy Plan: Pathway to 2040 – Session 3,”
Presentation, delivered November 16, 2023, https://www.maine.gov/energy/
sites/maine.gov.energy/files/inline-files/ME%20GEO%20Pathways%20-%20
Stakeholder%20Meeting%203%20-%2016Nov2023.pdf.
19 Governor’s Energy Office, “Maine Energy Plan: Pathway to 2040 – Session 3,”
Presentation, delivered November 16, 2023, https://www.maine.gov/energy/
sites/maine.gov.energy/files/inline-files/ME%20GEO%20Pathways%20-%20
Stakeholder%20Meeting%203%20-%2016Nov2023.pdf.
20 Miriam Wasser, “What You Need to Know About the New Mass. Climate Law,”
WBUR, March 26, 2021, https://www.wbur.org/news/2021/03/26/new-mass-cli-
mate-law-faq.
21 New England for Offshore Wind, “Massachusetts,” Massachusetts for Off-
shore Wind, Accessed July 23, 2024, https://www.newenglandforoffshorewind.
org/states/massachusetts/#:~:text=Current%20Projects&text=Charlie%20
Baker%20signed%20H.,later%20than%20June%2030%2C%202027.
22 M.J. Bradley and Associates, “Act Creating the Next-Generation Roadmap for
Massachusetts Climate Policy,” April 2021, https://www.erm.com/globalassets/
documents/mjba-archive/insights/mjba-summary-of-massachusetts-cli-
mate-legislation_april-2021.pdf
23 DSIRE, ”Clean Energy Standard,” Program Overview, January 4, 2024, https://
programs.dsireusa.org/system/program/detail/22536/clean-energy-standard
24 DSIRE, “New Hampshire Renewable Portfolio Standard,” Program Overview,
March 5, 2024, https://programs.dsireusa.org/system/program/detail/2523.
25 Normandeau Associates Inc et al., “Potential Environmental, Economic, and
Energy Impacts in New Hampshire from Development of Offshore Wind in the
Gulf of Maine,” New Hampshire Department of Energy, September 2023, https://
www.energy.nh.gov/sites/g/files/ehbemt551/files/inline-documents/sonh/off-
shore-wind-potential-environmental-economic-energy-impacts-report.pdf.
26 New Hampshire bill would make use of ESG in investments a felony | ESG Dive
27 Menning: Fossil Fuel Divestment Falls Short - The Dartmouth
28 State of Rhode Island, Governor Dan McKee, “Governor McKee Signs Historic
Legislation Requiring 100% of Rhode Island’s Electricity to be Offset by Re-
newable Energy by 2033,” Press Release, June 29, 2022, https://governor.
ri.gov/press-releases/governor-mckee-signs-historic-legislation-requir-
ing-100-rhode-islands-electricity-be#:~:text=Rhode%20Island%20is%20
the%20first,at%20the%20signing%20by%20Lt.
29 RIEC4, “Rhode Island 2022 Climate Update,” RI Executive Climate Change Coor-
dinating Council, December 15, 2022, https://climatechange.ri.gov/media/1261/
download?language=en.
30 State of Rhode Island, “2021 Act on Climate,” Accessed July 22, 2024, https://
climatechange.ri.gov/act-climate.
31 RIEC4, “Rhode Island 2022 Climate Update,” RI Executive Climate Change Coor-
dinating Council, December 15, 2022, https://climatechange.ri.gov/media/1261/
download?language=en.
91
32 See ESG table

33 Peter Hirschfeld, “Clean Energy Mandate for Vt. Utilities Becomes Law
After Democrats Override Veto,” Vermont Public, June 17, 2024, https://
apnews.com/article/vetoes-vermont-data-privacy-renewable-energy-pesti-
cides-8c5c640040bb4a6d8b5ebf0f7bb536ef#:~:text=By%20Monday%20
afternoon%2C%20the%20state,be%20too%20costly%20for%20ratepayers.
34 Vermont Natural Resources Defense Council, “Vermont Senate Passes Modern-
ized Renewable Energy Standard,” News & Stories, May 7, 2024, https://vnrc.
org/29640-2/.
35 See ESG table
36 Bill Status S.259 (Act 122) (vermont.gov)
37 Drew Hutchinson, “States Take Measured Approach to Adopting Clean Cars
Rules,” Bloomberg Law, December 26, 2023, https://news.bloomberglaw.com/
environment-and-energy/states-take-measured-approach-to-adopting-clean-
cars-rules.
38 Mark Pazniokas, “New Bill Outlines A Longer Path To Zero-Emissions Vehicles
Rules in CT,” CT Mirror, March 7, 2024, https://ctmirror.org/2024/03/07/new-bill-
outlines-a-longer-path-to-zero-emission-vehicle-rules-in-ct/.
39 Center for Climate and Energy Solutions, “U.S. State Clean Vehicle Policies and
Incentives,” Library, Map, Accessed August 1, 2024, https://www.c2es.org/doc-
ument/us-state-clean-vehicle-policies-and-incentives/#:~:text=As%20of%20
August%202022%2C%20fourteen,Vermont%2C%20Virginia%2C%20and%20
Washington.
40 U.S. Department of Energy, “Vehicle Registration Counts by State,” Alternative
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cle-registration.
Incentives,” Library, Map, Accessed August 1, 2024, https://www.c2es.org/doc-
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42 U.S. Energy Information Administration (EIA), “US Electricity Profile 2022,” No-
vember 2, 2023, https://www.eia.gov/electricity/state/
43 ISO New England, “Key Grid and Market Stats,” Accessed September 13, 2024,
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44 ISO New England Inc. Internal Market Monitor, “2023 Annual Markets Re-
port,” ISO NE, May 24, 2024, https://www.iso-ne.com/static-assets/docu-
ments/100011/2023-annual-markets-report.pdf.
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48 U.S. Energy Information Administration, “Table 5.6.A. Average Price of Electricity
to Ultimate Customers by End-Use Sector by State, May 2024 and 2023 (Cents
92
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49 These additional costs do not account for the significant costs of upgrading the
distribution system to accommodate the additional demand for electricity or
necessary upgrades to home electric systems.
50 U.S. Energy Information Administration, “Retail Sales of Electricity, New En-
gland, Annual,” Electricity Data Brower, Accessed July 30, 2024, https://
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sec=vg&linechart=~ELEC.SALES.NEW-RES.A~ELEC.SALES.NEW-COM.A~ELEC.
SALES.NEW-IND.A~ELEC.SALES.NEW-TRA.A&columnchart=ELEC.SALES.NEW-
ALL.A&map=ELEC.SALES.NEW-ALL.A&freq=A&start=2001&end=2023&c-
type=linechart&ltype=pin&rtype=s&pin=&rse=0&maptype=0.
51 Matthew Panhans et al., “The Effects of Electricity Costs on Firm Relocation
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52 Cooper Center, “National population projections.” https://www.coopercenter.org/
national-population-projections
53 Isaac Orr and John Noer, “Summertime and the Risk of Blackouts is Higher,” Min-
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54 Key Grid and Market Stats (iso-ne.com).
55 See “Plant Construction by Type,” in the Appendix.
56 National Renewable Energy Laboratory, “The Curtailment Paradox in a High Solar
Future,” U.S. Department of Energy, accessed October 6, 2021, https://bit.ly/2ZT-
4JMu
57 ISO-New England, “2021 Economic Study: Future Grid Reliability Study Phase 1,”
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ments/2022/07/2021_economic_study_future_grid_reliability_study_phase_1_
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58 ISO-NE Load Forecast, “2024-2033 NE Region Hourly Load Forecast,” May 1,
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59 ISO-NE, “Variable Energy Resource (VER) data,” https://www.iso-ne.com/sys-
tem-planning/planning-models-and-data/variable-energy-resource-data
60 ISO-NE, “2024-2033 NE Region Hourly Load Forecast,” May 1, 2024, https://
www.iso-ne.com/static-assets/documents/100011/hrly_isone_fcst_eei2024.txt.
61 ISO-New England, “2050 Transmission Study,” ISO New England Inc. Transmis-
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64 See New Hampshire Electricity Consumption in the Appendix.
65 ISO-New England, “Markets” Key Grid and Market Stats, Accessed August 7,
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93
66 ISO-New England, “Economic Planning for the Clean Energy Transition, Illuminat-
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67 Melissa Whited et al. “Charting the Wind: Quantifying the Ratepayer, Climate,
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69 Federal Energy Regulatory Commission, “Order Addressing Arguments Raised
on Rehearing, and Setting Aside Prior Order in Part,” Docket Numbers ER18-
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71 Isaac Orr and Mitch Rolling, “Renewables Blueprint,” Center of the American
Experiment, March 2021, https://files.americanexperiment.org/wp-content/up-
loads/2021/06/Renewable-Energy.pdf.
72 See “Annual Average Cost of Each Energy Source,” in the Appendix.
73 Isaac Orr and Mitch Rolling, “Renewables Blueprint,” Center of the American
Experiment, March 2021, https://files.americanexperiment.org/wp-content/up-
loads/2021/06/Renewable-Energy.pdf.
74 See “Overbuilding and Curtailment” in the Appendix.
75
76 See “Overbuilding and Curtailment” in the Appendix.
77 See “Hourly Load, Capacity Factors, and Peak Demand Assumptions,” in the
Appendix.
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80 New Yok Independent System Operator, “NYISO Report Highlights Risks to
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81 New York State Energy Research and Development Authority, “Offshore Wind
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94
83 Natural Resources Canada, “Table 21: Heating System Stock by Building Type
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85 Kevin Rennert et al., “The Social Cost of Carbon,” The Brookings Institute, Sep-
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87 Trevor W. Lewis and M. Ankith Reddy, ”Net-Zero Climate-Control Policies Will Fail
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88 International Federation of Accountants, “Momentum Builds for Corporate
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94 2021 International Fuel Gas Code (IFGC), “Chapter 7 Gaseous Hydrogen Sys-
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95
95 Coastal Resource Group, “HDPE vs. Steel Pipe: Why HDPE is superior,” Accessed
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98 Kevin Topolski et al., “Hydrogen Blending into Natural Gas Pipeline Infrastructure:
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99 American Petroleum Institute, “Benefits and Opportunities of Natural Gas Use,
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102 AOER calculations; estimate was obtained using pipeline costs from 10 reported
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128 See FIGURE 33
129 See FIGURE 33
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100
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101
102
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The Staggering

Section I: New England State Policies............................................................................................. 11

Section II: Impacts of Decarbonization Policies on ISO-NE

Section III: Energy Demand.......................................................................................21

Section V: How Offshore Wind, Onshore Wind, Solar, and Battery

Section VI: The Levelized Cost of Energy for Different

Section VII: Implications for Reliability..................................................................49

Section VIII: Emissions Reductions......................................................................... 55

Section IX: ESG’s impact on New England utility bills

T he six New England states (Connecticut, Maine, Massachusetts, New

likely not be enough to fully meet electricity demand by 2050, especially in

T he Economic Planning for the Clean Energy Transition report released by

1. Reconsider emission-reductions goals in the context of

2. Lift state nuclear moratoriums. Lifting moratoriums and im-

3. Purchase Power Agreement transparency. Any state that

4. Allow nuclear to compete with renewables. Net Zero man-

5. Require investment fee reporting. Mandatory reporting of

New England State Policies

In May 2022, Connecticut Gov. Ned Lamont signed a law establish-

In 2019, Maine Gov. Janet Mills signed legislation that increased

from 40 percent by 2030 to 80 percent by 2030 and 100 percent renew-

On March 26, 2021, then-Massachusetts Gov. Charlie Baker signed

group, these bills would require fiduciaries to appraise companies’ climate

New Hampshire’s renewable energy mandates were established in

In June of 2022, Rhode Island passed legislation requiring that 100

emissions reduction goals of 45 percent below 1990 levels by 2030, 80

In June of 2024, the Vermont legislature overrode Gov. Phil Scott’s

Vehicle Electrification Policies

In addition to mandates for renewable or carbon free electricity,

Meanwhile, New Hampshire currently has no regulations requiring

Are the New England Decarbonization Plans Realistic?

These state Decarbonization Plans will require a massive buildout of

Impacts of Decarbonization Policies on

T he policies designed to decarbonize the power grid will have a pro-

Energy Supply Mix ISO-NE 2023

Natural Gas Nuclear Imports Hydroelectric Other

Wind Solar Coal Oil Battery Storage

SOURCE: ISO-NE Internal Market Monitor

Energy Supply Mix ISO-NE 2050

Natural Gas Hydro/Pumped Storage Nuclear Other Onshore Wind

SOURCE: ISO-NE Internal Market Monitor

FIGURE 2. Offshore wind becomes the largest source of electricity in New

I SO-NE expects a substantial increase in the total amount of electricity

FIGURE 4. This figure shows peak electricity demand in Gigawatts(GW).

However, the increase in electricity use for transportation and home

Calculating the Cost of the New

N ew England residents already pay some of the highest electricity pric-

Total Annual Cost per Customer in ISO-NE

Under the New England Decarbonization Plans, residential electricity

Total Annual Cost per Residential Customer in ISO-NE

New England’s commercial customers currently use about 45% of its

Industrial companies in New England, such as manufacturers, used

Total Annual Cost per Commercial Customer in ISO-NE

Total Annual Cost per Industrial Customer in ISO-NE

ities.51 If electricity prices for businesses in New England become overly

Total Cost per Capita in ISO-NE

FIGURE 9. Total Cost per Capita in ISO-NE

Total Cost per State in the ISO-NE Footprint

of population projects based on US Census data, we estimated that Mas-