A Canadian company will seek to temporarily block a new state law that requires utilities to buy renewable energy only from firms that generate power within Massachusetts.
Bill Taylor, senior vice president of U.S. power for TransCanada, said his company plans to ask for an injunction against the made-in-Massachusetts law because it could “damage” his energy firm at a time when utilities are seeking bids for new electricity contracts.
A favorable ruling for TransCanada could disrupt various ongoing negotiations over long-term renewable energy contracts, including preliminary talks now under way between Cape Wind Associates and Nstar.
The state announced yesterday that it had reached a partial settlement with TransCanada over the state’s aggressive new renewable energy requirements. The deal, which resolves one of the two main issues in TransCanada’s lawsuit against the state, would allow TransCanada to count existing energy contracts as it faces new requirements aimed at boosting the use of solar power in Massachusetts.
TransCanada, which filed suit against the state earlier this year, feared that it might have to renegotiate current energy contracts with customers to meet new solar standards. The agreement, announced by Gov. Deval Patrick’s energy and environmental affairs office, would effectively grandfather TransCanada’s existing contracts into new state rules.
Ian Bowles, Gov. Deval Patrick’s secretary of energy and environmental affairs, said the partial settlement “removes the cloud” hanging over the state’s new “solar carve-out” rule.
But it doesn’t eliminate TransCanada’s other complaint in its lawsuit that the made-in-Massachusetts clause violates the U.S. Constitution’s commerce clause, which restricts states from disrupting interstate commerce.
Bowles said he’s “confident that we will prevail” on the made-in-Massachusetts front.
But Taylor said TransCanada, which owns wind energy farms in Maine, will aggressively seek to challenge the controversial clause that could prevent it from competing for long-term energy contracts in Massachusetts.