No doubt Mike Tyson and Jake Paul are the main event tonight, but we’ve got utility vs. utility on the undercard, as Harvard Law’s Ari Peskoe excitedly reported just after sunrise this morning.
Utility v Utility antitrust suit!!
— Ari Peskoe (@AriPeskoe) November 15, 2024
Avangrid sues Nextera, claiming "NextEra has committed anticompetitive, unfair, and deceptive business practices to foreclose competition for the supply of wholesale electricity on the ISO-New England marketplace."https://t.co/M2IkOsdidg
On Tuesday, Avangrid filed suit against NextEra Energy, claiming hundreds of millions of dollars in damages to competition in the ISO-New England marketplace as the result of what it alleges are anticompetitive, unfair, and deceptive business practices.
Avangrid asserts that NextEra, the largest electric utility company in the world, has been “sabotaging Avangrid’s development of a transmission line that will bring significant amounts of lower-cost, clean electricity to Massachusetts” by abusing the regulatory and judicial process, misleading voters with dark money campaigns, and obstructing electric infrastructure improvements.
“NextEra has used these anticompetitive and tortious tactics to line its own pockets by excluding lower-priced competition for electricity supply in Massachusetts from Avangrid’s New England Clean Energy Connect project (NECEC),” reads part of the lawsuit, filed by counsel for Avangrid, Central Maine Power Company (CMPC), and NECEC Transmission LLC.
NECEC is a $1 billion 145-mile high-voltage transmission line that would carry up to 1,200 megawatts (MW) of hydropower from Canada to the New England grid via CMPC’s Lewiston, Maine substation. The project, co-bid by Avangrid and Hydro-Québec, was authorized by the Massachusetts Legislature, which made it a core pillar of the Commonwealth’s transition to renewable energy.
“Thus, NextEra’s actions have not only damaged Avangrid, but have also postponed Massachusetts’s clean energy transition and forced consumers across the region to pay hundreds of millions of dollars more for their electricity to NextEra and other power generators in the region,” the suit alleges.
This week, the Massachusetts State House passed its long-awaited clean energy bill, now awaiting the Governor’s signature. The Commonwealth intends to generate at least 40% of its electricity from renewable sources by 2030. Last year, the legislature tried to jump-start NECEC by including language in a spending bill that would renegotiate how the project would be payed for.
“Completion of the NECEC line is important for Massachusetts customers,” said Lauren Diggin of the Massachusetts Department of Energy Resources at the time. “This project will help stabilize our electric rates, provide clean, reliable winter energy supply, and reduce the state’s emissions.”
“A multifaceted, scorched-earth scheme”
The Massachusetts Legislature solicited bids for the transmission project in 2018. NextEra was one of the losing bidders. Avangrid says its adversary in the filing is threatened by NECEC’s lower-cost competition, jeopardizing the profitability of NextEra’s existing power plants and pushing down the overall price of electricity in Massachusetts.
“Both on its own and in conspiracy with others, NextEra engaged in a multifaceted, scorched-earth scheme to delay and even try to block NECEC altogether,” continues Avangrid’s legal team.
The court documents go on to lay out multiple prongs of an alleged NextEra scheme to attack permitting and approvals and the regulatory process while opposing NECEC at every turn. The suit describes a dark-money operation and subversion through improperly registered shell companies, in addition to an “unreasonable refusal” to accept an Avangrid-funded upgrade of an outdated circuit breaker at its nuclear power plant, Seabrook Station. By refusing the new breaker, NextEra “physically prevented NECEC from being able to connect to the grid,” the suit claims.
Avangrid points out that in November of last year the Maine Commission on Governmental Ethics and Election Practices released the results of its enforcement actions and legal findings that NextEra-funded political organizations had violated Maine campaign finance laws by failing to properly register with Maine election authorities. The litigating utility also included a finding from a D.C. Circuit court that found NextEra’s practices to be “anti-competitive” and “hardly consistent with good business practices.”
“NextEra’s scheme has harmed competition, damaged Avangrid and consumers, and held Massachusetts’s clean energy transition hostage,” the suit adds.
“If incumbent electricity generators such as NextEra can practice scorched-earth, anti-competitive, illegal, and unfair tactics to delay new projects with impunity, then the clean energy transition will become enormously more expensive, if able to succeed at all,” it continues. “The costs and impacts of the delay caused by such conduct are massive. Indeed, NextEra’s actions in this case caused (1) the needless emission of tons of CO2, (2) Massachusetts consumers to pay significantly more for retail electricity, and (3) hundreds of millions of dollars in additional costs to Avangrid— all so that NextEra could squeeze several more years of additional monopoly profits out of the New England grid. This cannot stand.”
Avangrid demands a jury trial. The utility is seeking monetary damages plus interest, attorneys’ fees, expenses, and court costs, plus permanent injunctive relief barring NextEra from continuing its “anticompetitive scheme.”
