OK, it’s election night, a building collapsed and was demolished today, and the PUC held a pre-hearing concerning the Clean Power/PSNH dispute.
Crazy news day, making for a crazy news week. I didn’t make it to the PUC hearing in Concord, but what I’m hearing is that PSNH told the PUC they have no deal with Laidlaw. None. Zero.
I wasn’t there, but that’s the report I got. I’m going to look into it more, but the city has been operating for more than a year on the assumption they did, as per a press release sent out late September 2008. If they don’t I don’t know what that means. I have to look into it further, but that’s my understanding of what PSNH said at the hearing. At this point I don’t have anymore information.
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ErikEisele.com 
I think that printing rumors or misleading information is pretty bad journalism. I would love to know the source of that information. Let me guess. It's Clean Power or one of their supporters.Here's the quote provided to us for our 9/08 news release by PSNH President & COO Gary Long: “The development of new native sources of renewable energy is essential for New Hampshire’s energy future,” said Gary Long, PSNH president and chief operating officer. “The purchase of power from the Berlin Project will help us to meet the requirements of the state’s Renewable Portfolio Standard and add to our portfolio of CO2-neutral energy sources.”Quoting PSNH spokesman Martin Murray from a 10/08 Concord Monitor story:"From (Laidlaw's) end, with this announcement, they're able to demonstrate to our audiences that they have an agreement with a known entity in the state," said PSNH spokesman Martin Murray. "It shows a good-faith effort to get these projects up and running. . . . It doesn't give any special status to the project. It's a question mark that's now answered." If what you are trying to suggest is that we have not yet signed a PPA with PSNH, the answer is yes and I don't think that's been any secret. We have been negotiating that agreement with them for some time based on an agreement we reached with them back in September 2008 outlining the major business terms. Nothing has changed as far as I know and we fully expect to conclude those negotiations shortly.
Could it be that Laidlaw's house of cards is tumbling? What a tragedy it would be if Bertrand lost on the false statements of Laidlaw. I can only keep my fingers crossed until the election returns are in.
Thanks for the comments. As I said, this is unconfirmed as yet, but that's the report I got. The transcript should be available in several days.
Dude they have no actual numbers but have a committment that is what they are saying. You are an idiot for posting this. Journalist?Trust funder is more like it.
Erik, Thanks for that post. Clearly, neither the guys from ihub nor byte&chew seem to be interested in unbiased info when it comes to LLEG. You did say it's unconfirmed etc – see nothing wrong with your post. Anxiously waiting for transcripts! Keep up the good work. A LLEG investor.
I was at yesterdays hearing at the PUC and can attest that what was posted by Erik was, and is, accurate.There were 27 people in the room, including a court recorder who is in the process of producing a complete transcript of the proceedings. Any, or all of those sources can confirm the validity of the comments made by Attorney Bersak and subsequently quoted by others.Here's what I heard – PSNH Attorney Bersak speaking; "Let me clear up a misconception. We have no contract with Laidlaw. Let me repeat that. There is NO contract with Laidlaw. An agreement between us is merely a twinkle in Laidlaws eye."In subsequent comments, attorney Bersak acknowledged that PSNH had been talking to Laidlaw for 2 years, but that those discussions were simple in nature and covered nothing more than a possible price that PSNH might pay. PUC chair Tom Getz then asked Mr. Bersak if there was anything in the form of an understanding, or anything in writing – to which Mr. Bersak responded . . . No.The commission transcript will be out soon to bear out those quotes.
Mr. Bartoszek clearly got caught with his hand in the cookie jar. Laidlaw is good at deception but very poor at delivering results. They've produced zero MW of power since their inception 10 years ago. Even with Grenier as mayor I don't expect Laidlaw to succeed in Berlin. Mr. Bartoszek should go back to Wall Street. He fits in much better there.
Thanks, Bill. How does what you recall hearing square with the joint Laidlaw/PSNH press release announcing that the two parties had "reached agreement…on the material terms of a contemplated 20-year power purchase agreement…subject to the execution of a definitive power purchase agreement, as well as approval by the New Hampshire Public Utilities Commission"? Mr. Bersak's boss is quoted in the release, so presumably signed off on the characterization of the agreement. The release cited contract length and terms including output, capacity and renewable energy certificates, so is clearly much more substantive than a "simple discussion" about "possible price". Allowing that your memory is completely accurate, what statement carries more weight for the purposes of the discussion of whether an agreement exists between Laidlaw and PSNH: extemporaneous remarks by staff counsel under questioning, or a statement by the CEO that was drafted, edited, vetted and reviewed before being issued? Or put another way, if no agreement exists as you imply, why has PSNH gone along with the ruse for over a year without correcting the record despite having several opportunities to do so in the press? Before you answer that question, recall that both PSNH's parent company Northeast Utilities and Laidlaw are publicly traded companies that carry certain obligations with respect to their public communications.http://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsId=20080929005466&newsLang=en- Cliff Myers
Cliff,That means that somebody is not telling the truth. Either PSNH is misleading the PUC (under oath) or Bartoszek is misleading investors. If I were a betting man I'd say that Bartoszek is not telling the truth. Either way the PUC is going to get to the bottom of things. Furthermore, PSNH has not yet adequately addressed their refusal to even talk to Clean Power. PSNH and Laidlaw are going to come under continued scrutiny, particularly if Laidlaw ever files a permit application with the State. I for one plan to watch this very closely and make sure that the Governor's office is made aware of the games being played here at the expense of the residents of Coos County and Berlin, NH. I’m personally not going to rest until somebody explains the BS going on behind the scenes.
Anonymous:So your theory, in essence, is that Mr. Bartoszek fraudulently inserted a quote from PSNH CEO Gary Long into a press release announcing a non-existent deal so he could mislead investors, and that PSNH declined to correct the record even when news organizations such as the Concord Monitor and Berlin Daily Sun contacted them for comment. Occam's razor objects. Much more likely is that "Bill", failing to appreciate the distinction between a preliminary agreement on material terms and a signed, sealed and PUC-approved agreement, simply heard what he wanted to hear. Let's be honest: "Bill" hardly sounds like an unbiased observer.- Cliff Myers
You bring up some good points Cliff. truth is a fleeting creature and we all see things through the lens of our own experience. I will say that I am vexed as to the veracity and candor issue and . . . I don't know that the question of which statement carries the more weight can be answered at this point. There's just not enough information available at this point.I would think that a lawyer reading his prepared statement in a formal proceeding before the commission would be concerned that any error or falsehood in those statements . . . could get him in trouble. Note – My memory and notes are clearly not perfect and I may have a few words wrong, but what I wrote fairly accurately portrays what was said by attorney Bersak.That said, the real question/issue then is – – what does it mean and how does it fit into the available data?I will say that the obvious conflict between the PR's and the company's statements before the PUC was immediately noted and was raised to the commission as an issue of candor and truthfulness in the proceedings.At this point Cliff, can't really answer you question. An expedited copy of the transcript from Tuesday has been requested. That will allow us to fully verify my notes and memory. From there, we'll compare statements and try to make a determination as to where the truth lies. My gut feeling is that the lawyer was telling the truth, but we'll have to see.
Good work Bill. Thanks for the information. Bartoszek is a slipperly little snake oil salesman. What more can we expect from an ex Wall Street executive? They simply don't have the same integrity as us Main Street types.
Bill:Let's say by way of analogy that you decided to buy a new house and signed a P&S. You mention to a friend that you've bought a new house. Later on, a different friend says he heard you bought a new house and you reply, "Well, I haven't closed yet and I still have to resolve a couple issues with the existing owner, so technically it's not a done deal yet." Is there an issue of veracity and candor here? Or is it that there is a somewhat fluid definition of "bought a house" that could broadly mean anything from "under agreement" to "keys in hand" depending on the context?Applying this to Laidlaw/PSNH, isn't it possible that they announced with all veracity "an agreement on material terms", but when questioned in the context of a PUC hearing, Mr. Bersak (who is an attorney and therefore can be expected to approach these sorts of questions as literally as possible) responded from the perspective of the PUC itself, which doesn't regard any agreement that hasn't yet been approved by the PUC as an actual agreement?You've fallen into a classic logical trap of a false choice: either Mr. Long is guilty of making a materially false statement, or Mr. Bersak has perjured himself, or as Anonymous said, "Someone's not telling the truth." You tend to think a lawyer is too careful to make an error, but fail to acknowledge that a CEO making materially false statements is just as serious an issue, and therefore just as likely to be avoided by someone who managed to climb to the top of a regulated utility.So, given the choice between: A) a lying CEO; and B) a lying attorney, maybe the real answer is: C) statements by the two only sound contradictory to someone who, for whatever reason, is invested in the notion that someone somewhere must be lying. – Cliff Myers
Erik, It would be greatly appreciated if you posted a link to the official transcript when available. that would be a game changer! thanks.
Planning on it. Thanks for the comments all.
Thanks, Erik. I think we all appreciate your service to the public in posting what you can in a fair and unbiased manner. Keep up the good work.- Cliff Myers
Cliff, Not to belabor the point, but just to clarify a few things.Your analogy of a P&S is a good one, but is flawed. – first of all a Purchase and Sales Agreement, is just that. A legally binding agreement. As such, failure of either party to comply with the document can be the cause of legal action. Nothing at all like the hypothetical term sheet.- secondly, when the chair of the PUC asked if there was anything in writing, attorney Bersak responded – NO. To me, that question was pretty clear. If there was anything in writing, including a term sheet, I would have expected the lawyer to acknowledge it.As I've said all along, memory and notes may well be flawed, but I've accurately reported what I heard and have drawn what – to me – are clear and appropriate conclusions.
Bill:From the Berlin Daily Sun:"(Commissioner Amy) Ignatius asked about Laidlaw's contract with PSNH.Bersak said PSNH does not have a contract with Laidlaw but has agreed to a term sheet for a 20-year contract and is still negotiating price. He said any contract would be subject to Laidlaw obtaining all necessary permits and the approval of the PUC."So your memory is at odds with the Daily Sun on two key points: first, it was Commissioner Ignatius, not Chariman Getz, that asked the question; second, Mr. Bersak responded that there was a term sheet. Bersak's response is consistent with what both Laidlaw and PSNH have claimed over the last year, and, of course, very much inconsistent with your memory, which you have so graciously conceded may be flawed.I anticipate that you will attempt to belabor the point by claiming that Chairman Getz asked the question at a different part of the hearing and got a different answer, or by making an eye twinkle fit your narrative, but the bottom line is this:"…PSNH…has agreed to a term sheet for a 20-year contract…"There it is. In black and white. – Cliff Myers
"There it is. In black and white".Nothing that PSNH or Laidlaw does is "black & white". I cannot wait for this investigation to continue so that we can all get to the bottom of what appears to be the shafting of New Hampshire electric rate payers by PSNH. This issue is far from over and eventually with enough digging the truth will prevail. Dirty back room politics won't be tolerated by the many people who care about Northern NH.
Anonymous:Actually, when it comes to power purchase agreements, everything is black and white because they must be reviewed and approved by the PUC to ensure, among other things, that ratepayers don't get the shaft. According to Mr. Bersak, Clean Power's power is too expensive, and any costs from a power purchase agreement is borne by the ratepayers. Therefore, any agreement between Clean Power and PSNH would be rejected by the PUC to protect the ratepayers from getting the shaft.As Mr. Bersak stated, PSNH has no legal obligation to enter into a power purchase agreement with anyone. Which means that this PUC investigation is a charade; the best they can do is prove that PSNH did something that was entirely within their rights. The people getting the shaft here are the taxpayers who are financing this Potemkin investigation designed to divert attention from the inconvenient yet stubborn fact that, as one can conclude from their pricing being unsupported by the market, Clean Power's pro formas are red as far as the eye can see. But, hey, why admit that your project can't possibly return a single dime in profit when you can just point fingers at the guys who won't touch your overpriced product?Seriously, is the State of NH so flush with cash that it can afford to drag lawyers in to lecture commissioners on basic points of law such as that utilities don't have to negotiate agreements with anyone?- Cliff Myers
Cliff There are three commissioners and at different times, each asked questions and got responses. I chose to quote Chairman Getzs question and response and the reporter chose Commissioner Ignatius' question. Sorry, but there is not a conflict. Secondly, Mr. Bersak never saiod that Clean Powers electricity was too expensive. The issue of this docket is whether or not PSNH has the right to not look at a CPD offer. As stated during testimony, they have not evaluated a CPD offer, so clearly they could never say that it was too expensive. Finally, Attorney Bersak did say that he believes PSNH has not legal obligation to consider an offer from CPD – there was never any discussion of entering into an agreement. What was not stated was the follow on question as to whether or not PSNH had a good business obligation to consider offers from all generators. To which Mr. Bersak responded in teh affirmative. Commissioner Getz then followed up with the question as to how PSNH could reconcile the acknowledged good business obligation with the stated no legal obligation. Attorney Bersak was silent on that as I recall. As to Clean Power's pro formas, I am surprised you have reviewed them, as that would be the only way that you could state they are red. Given your priveleged information and obviously insider position, perhaps there is more you would choose to share with us. Or would you just admit that you made that up and resorted to hyperbole?
Bill:So Chairman Getz and Commissioner Ignatius asked the same question and Mr. Bersak answered one in the negative and the other in the affirmative, and you claim there's no conflict? As a simple matter of logic, you're wrong.You state that Mr. Bersak never said that Clean Power's electricity was too expensive. Yet according to the Berlin Daily Sun:"…Bersak charged Clean Power has been unable to find a buyer for its power because it is too expensive."You state that PSNH has not evaluated a CPD offer, and yet according to the Berlin Daily Sun:"(Bersak) said PSNH was in the middle of evaluating an offer from Clean Power when it renewed its complaint…"The errors in your recollections are piling up pretty high. For guys that are always trying to impeach the credibility of others, you and Mr. Edwards sure do spin some whoppers.As a quick trip up the page will confirm, my statement about the pro formas was not based on a review, privileged information or an insider position, but rather was a conclusion based on CPD's pricing (according to Mr. Bersak) being unsupported by the market (remember, he didn't just state that PSNH wouldn't buy the power at CDP's price, he stated that NO ONE would — "Clean Power has been unable to find a buyer…"). I didn't simply make this up or resort to hyperbole. It is a reasonable conclusion to draw from evidence obtained from a solitary source: the Berlin Daily Sun's coverage of the PUC preliminary hearing, to wit:* PSNH began its review of a CPD offer;* This review was carried out by "company experts in a variety of fields to see if (it was) in the economic interests of PSNH's customers";* This review yielded enough information to lead PSNH to conclude and state to the PUC that "Clean Power has been unable to find a buyer for its power because it is too expensive"; * One can infer from Mr. Bersak's statement that the cash flow assumptions in CPD's pro formas are based on unrealistically high pricing that cannot attract a single buyer;* One can further infer that if pricing is brought within market range, a buyer could be found but cash flow would be depressed;* Finally, one can infer that CPD's inability to lower its price to an acceptable market level is due to constraints on the expense side;* Conclusion: A reasonable assumption on pricing blows CPD's model to smithereens.Outside reality check: building a 29 megawatt biomass plant from scratch would cost between $125m – $150m. Servicing that sort of capital cost is a huge expense constraint, and likely makes the pro formas look pretty ugly. As someone on another thread observed, maybe PSNH's problem isn't with CPD, but with CPD's business model.I think we can expect all this to come out during the PUC investigation, because Mr. Bersak will have to sustain his claim about expensive power, and discovery's a two-way street. Filing this complaint is a real Hail Mary pass, because the PUC is going to comb through CPD's business assumptions, Commissioners and staff are not stupid, and the very last thing they want to see is ratepayers get exposed to a bad deal like the $10 million ratepayer subsidy Concord Steam got in 1984-2004.- Cliff Myers
Quoting the BDS Cliff? Really? That’s the best you can offer? Bill, weren’t you there? hmmm…makes one wonder.Erik, I hope you have on your reporters cap. 😉
Cliff,We are all looking forward to discovery. PSNH has a moral obligation to at least sit down with Clean Power at the bargaining table. That seems like common sense to me. Apparently common sense aint to common for you.
Anonymous I:The Berlin Daily Sun piece was written by a neutral observer. Bill, for all his thoughtfulness, is not a neutral observer and has freely admitted that his memory may be faulty. So, yes, the BDS is a more credible source than Bill.Anonymous II:What may seem like common sense to you is irrelevant. What matters is what the law says, and under the law, PSNH is not compelled to enter into agreements with any developer.As for discovery, CPD has had the luxury of working with a Mayor who, in his zeal to embrace an alternative to the Laidlaw project, failed to ask CPD to justify its project on economic grounds. An examination of publicly available information posted on CPD's website raises a lot of serious questions, such as how they expect to burn fuel for which they aren't permitted. For the first time ever, CPD is going to have to answer tough questions about their project, starting with the $125m-$150m question of how they can possibly recover their capital costs.- Cliff Myers
Cliff not sure as to how you came up with a capital cost of #125-$150 million, because CPD has publically stated numerous times tha the anticpated capital costs are in the range of $80 million. Further, there are New Market Tax Credits and Investment Tax Credit conversion funds available that will greatly assist the developer. Additinally, the federal government has recently announced a loan guarantee program for new renewable generation facilities. Bottom line, doesn't look like capital costs are a problem.Regarding serious fuel questions. CPD has stated in public session of the city council that subsequent to the filing of their air permit, the possibility of working with an algae production facility came to light. As was also stated, should that relationship lead to development of the algae facility and the possibility of burning spent algae, the city and DES will be consulted and – if all agree – a revised air permit submitted before any change in fuel.What I'm really looking for though, rather than the continued red herrings, is a sound answer as to why you believe that PSNH does not have an obligation of any kind to consider a bona fiede offer of power from CPD. That's the issue before the PUC and the issue here.Should PSNH, for the good of the citizens of the State of NH, consider all offers of power that come before them?If not, why not?
Bill,Cliff cannot answer that nor does he want to. PSNH will have to, but will fail. In the end the PUC will force PSNH to the bargaining table which is the right thing to do for Berlin, for electric rate payers and for the NH's way of life. This is what happens when a NY penny stock corporation gets into bed with a CT based power hungry monopoply. The truth will prevail and I sincerely believe the NH way will win out over greed and corruption.
"The Berlin Daily Sun piece was written by a neutral observer."Well ok then Cliff. That speaks volumes about your “sources”. Thanks.