TESTIMONY OF
THE HONORABLE PAUL R. LePAGE
GOVERNOR
STATE OF MAINE
BEFORE THE
SUBCOMMITTEE ON ENERGY AND POWER
COMMITTEE ON ENERGY AND COMMERCE
U.S. HOUSE OF REPRESENTATIVES
DISCUSSION DRAFTS ADDRESSING
FEDERAL HYDROPOWER AND NATURAL GAS PERMITTING
MAY 13, 2015
Good morning Chairman Whitfield, ranking member Rush and members of the
subcommittee. Thank you for the opportunity to testify today and for the efforts
this Committee will take to modernize our federal permitting process for energy
infrastructure.
America’s energy challenges can be addressed with our continent’s natural
resources. Innovation, research and development, and private capital have
catapulted our energy situation from one of weakness to one of strength. In
particular, the natural gas production renaissance has lifted our economy and given
American manufacturing a strategic competitive advantage.
While the speed of energy technology innovation has increased, our federal
permitting process has languished. The process is often hijacked by activists who
are not looking to improve projects or raise substantive environmental
considerations. Rather, their objective is simply to block critical energy
infrastructure across the country – to keep projects stuck in bureaucracy and to
hold our economies back. In many cases, bureaucracy has replaced democracy in
our country.
In Maine, we have seen firsthand the consequences of failing to advance energy
projects. Unlike much of the northeast, Maine continues to have manufacturing jobs.
Maine is the only New England state where the industrial sector is the largest
consumer of energy. Margins are tight in the manufacturing sector, and sawmills
and paper mills in Maine watch the price of energy very closely to ensure
profitability.
In the winter of 2012 to 2013, it became apparent to some of our biggest employers
that the region had major infrastructure challenges. Over the last 15 years, our
region has become increasingly reliant on natural gas. New England’s electricity
production from natural gas has shifted from roughly 15 percent in 2000 to 44

 percent in 2014 – but our natural gas infrastructure has not grown to meet this
increased demand. Transportation of natural gas from the west to east hit a
bottleneck that winter, causing prices to spike from $3 per MMBtu to nearly $20 per
MMBtu. Prices in New England were the highest in the world, despite the fact that
the most prolific gas production on the planet is less than a day’s drive away.
In the winter as prices now spike with the cold temperatures, many factories will go
idle. Since the bottleneck emerged over two years ago, the state has lost two major
manufacturers, and many employers shut down for the coldest periods of the winter.
It is not just manufacturing. The region has seen electric bills spike to an average
price of 17.34 cents per kWh – increasing in some areas by as much as 100 percent.
This disproportionately affects our elderly and low-income households, and it is
costing our region billions of dollars in artificially high energy costs.
Natural Gas Permitting
We need a sense of urgency at the federal level to approve interstate pipelines that
will address these energy price spikes and get energy to the market. The draft bill
before you would, in my view, help modestly. As you know, there are multiple
federal agencies involved in the permitting process, ranging from the Army Corps of
Engineers to Fish and Wildlife. The draft bill would continue to use the expertise of
these agencies, but firmly establishes the Federal Energy Regulatory Commission as
the lead federal agency to coordinate review of the projects.
There are major projects proposed in New England to bring natural gas to
households and employers. Federal law should reflect that these pipeline projects
are critical to our economy, and there should be one lead agency that has the clear
authority to coordinate the review of the projects. It makes no sense that it should
take 3 to 5 years to construct a pipeline, especially when the economic
consequences are massive.
I encourage the Committee to support the draft bill and continue to work to return
our country to one that can carefully, but quickly, build the infrastructure that our
country needs.
Hydropower Permitting
Our country has ignored the benefits of hydropower production and potential. New
England is waking up to the fact that our region cannot meet our environmental
objectives without additional hydropower resources and is partnering with our
Canadian counterparts to take advantage of our largest trading partner’s surplus of
hydropower. We are now looking for a cross-border route for a transmission
project, and we hope the federal government reviews the project that is selected by
the region very quickly. To that end, I appreciate the Committee’s efforts to
streamline the approval of cross-border energy projects. The current process,
established through a patchwork of Executive Orders, has become bogged down and
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 subject to potential political interference. Congress should replace the Presidential
Permit review with clear statutory authority that establishes a more transparent
and efficient review process for pipelines and electric transmission facilities that
cross the borders of the United States with Canada or Mexico.
Domestically, we should also be promoting the development of hydropower,
especially at existing facilities. Maine has one of the cleanest electricity-generating
fleets in the country, and hydropower is a major factor producing 26 percent of the
total power and 723 MegaWatts of installed capacity. My Administration has
undertaken an inventory of hydropower in our state to see if we can add capacity to
increase energy diversity and continue to lower pollution. The report was released
this February and found the state has 68 unpowered dams that represent a total
addition of approximately 70 MW of additional capacity, most of which are below 5
MegaWatts.
It makes no sense that these existing dams should be under the purview of the
federal government through the Federal Power Act if they add power production. In
these situations, the Federal Power Act just adds red tape and duplication. States
should have the authority to permit these facilities and work with the local
population and environmental agencies to transition a non-operational dam to one
that is producing local, clean and consistent power.
Conclusion
Our federal regulations need to be overhauled to unleash our country’s economy.
Natural gas and hydropower are ready to power our idle mills. I appreciate the
work that this Committee is doing to bring rationality to the federal permitting
process. I encourage the Committee to adopt these modest bills and to continue the
work to accelerate the energy infrastructure projects that can bring additional
prosperity to Maine and the rest of the country. Congress needs to take back our
country from the overzealous activists that are taking advantage of the bureaucracy
and tying our country up into knots.
I thank the Chair and Ranking Member and welcome your questions.

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 Appendix
Natural gas and Electricity Prices in New England – Source ISO-New England

New England versus rest of the country – Retail Electrical Costs – Source New
England States Cooperative on Electricity

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