AUGUSTA — Watching your favorite streaming service or local TV station you may have noticed the repeated airing of an advertisement condemning “government-controlled power.”

The ads, put forth by Maine Affordable Energy Coalition, argue the proposal to replace Central Maine Power Co. and Versant Power with a consumer-owned power utility called the Pine Tree Power Co. could cost Maine ratepayers $13.5 billion in debt.

The issue has been debated in Maine for several years. The argument has been made that electricity delivery costs more because private companies such as Central Maine Power have to generate profits for their shareholders. The solution offered would be to take over these private utilities through eminent domain and replace them with a consumer-owned entity.

That would mean revenues generated by the utility would be reinvested into it, and it would be run by a public board that would have open, transparent meetings.

“It comes down to my belief in democracy,” said Executive Director of Our Power Andrew Blunt. “With a customer-owned utility, we would have a voice — any kind of voice — and that is absolutely central to this work.”

Asked why he and others were passionate enough about this issue to seek such a major change, Blunt pointed to the lack of transparency and accountability he sees demonstrated by our for-profit energy utilities. “It puts Mainers in the driver’s seat.”

Opponents of the plan counter, asking, “At what cost?”

“The plan proposes a government-controlled electric utility and is a bad idea for Maine and Maine electricity customers,” said Avangrid Corporate Communications Manager Catharine Hartnett. “Elected politicians would be running the grid, likely with an out-of-state contractor, be beholden to short-term interests, and there will be no long-term planning or investment in system reliability or in enabling Maine’s clean energy future.”

Avangrid is Central Maine Power’s parent company.

Willy Ritch of Maine Affordable Energy Coalition said the coalition is a Ballot Question Committee, but some people consider it a Political Action Committee. It gets funding from Avangrid, but he said the coalition makes its own decisions about what ads to run.

“I do think that sometimes complex and important issues — like this one — can sometimes get overshadowed by the inside baseball of campaign finance and that kind of thing,” Ritch said. “My experience is that voters don’t really care that much about who is paying for a TV commercial but are more interested in what’s at stake.”

On the other side of the question is Our Power, an organization gathering signatures to put the issue on the ballot in November 2023.

Blunt said the organization is about 95% of the way to gathering enough signatures and plans to submit them to the Secretary of State’s Office in the fall.

Blunt said his group’s efforts, in contrast to CMP’s allies, are entirely grass roots in nature and do not include an ad campaign. He said Maine Affordable Energy has spent millions on the ads, which could have been spent improving the electric grid.

He goes further, characterizing the fight against a consumer-owned utility as a misleading campaign of disinformation. For example, he said the $13.5 billion figure has been “pulled out of thin air.” He argues the actual cost is closer to $6 billion.

Maine Affordable Energy argues the law requires fair market value be paid for assets seized by eminent domain.

“For Central Maine Power and Versant, that price will be $13.5 billion — three times the entire state budget,” a document from the group states.

The calculation starts with the net book value of the assets, but the coalition argues the courts are likely to assess a “multiplier” to take into account the value of the existing business and its employees. The organization also argues that could mean the actual costs would be as much as double the net book value.

“The figure is actually pretty conservative,” Ritch said. “…A recent seizure of a utility in Winterpark, Fla. …went for 5.5x net book value. So, the number, which experts on utility policy came up with, is solid. But if Our Power’s best argument is that they will saddle Mainers with ‘only’ $6 billion in debt, I don’t think they are going to win many people over.”

The logical way to decide between the arguments is to seek an independent party’s opinion, and the Maine Public Utilities Commission did that in 2020. London Economics International LLC did a feasibility study of an earlier bill aimed at creating the consumer-owned utility.

The report states in the short-term ratepayers would likely see an increase in their bills to pay off the purchase of the utilities and the long legal fight. It pointed out since this new entity would be nonprofit and tax-exempt, that could mean a loss of tax revenues for the state, resulting either in tax increases to Mainers or a loss of services.

Blunt said the revised bill clarifies the new nonprofit utility would pay the equivalent of property taxes. This had been a concern, given the amount of land the utilities own for transmission lines and facilities.

In the long term, lower electricity rates could take 10 years to materialize, according to the study. Since a contractor would have to be hired to provide the services, there was no guarantee there would be cost savings over the current companies providing this work.

Advocates of the consumer-owned model pushed back on the study saying London Economics International had a potential conflict of interest because it had worked for Emera, which was associated with Versant. The firm acknowledged this during a meeting in 2020 before the Legislature’s Committee on Energy, Utilities and Technology, saying it was an oversight not to inform the state earlier, according to reporting from CBS affiliate WGME.

Our Power also offers counter arguments made by electricity industry expert Bill Dunn, who argued the “report contained several significant errors which understated the positive economics of Pine Tree Power.”

Blunt said the takeover would be funded through low-interest (3%-5%) loans, and compared it to renting versus paying the mortgage. The consumers are paying now for the profit margins of the private companies. That’s rent, he said. With the new entity, they will be paying that amount toward buying the utility, and that’s more like a mortgage.

Ritch argues against the publicly owned utility saying it will still need to hire a for-profit private company to do the actual work of providing those services anyway.

Blunt said that is true, but now the rate-payers, through the seven-member leadership board that is elected to run the utility, would have more of a say in what decisions are made and would have transparency. He argues the meetings would be public, whereas CMP and Versant decide things behind closed doors.

Ritch characterizes this as a board of elected politicians, who will be beholden to campaign donors.

“Most Mainers feel politicians are involved enough in our lives,” he said.

Blunt said this would be a non-partisan board with members paid $100 per day. He said that would not be motivation to act as politicians, but more a matter of public service.

Again, this debate is not new in Maine. Last year, the state Legislature passed a bill to create the Pine Tree Power Co., but Gov. Janet Mills vetoed the move in July 2021.

At the time, Mills did not express much support for the present state of Maine’s energy utilities, calling their performance “abysmal,” according to the Portland Press Herald, and citing billing errors, rate increases and delays after outages among other problems.

“But LD 1708, hastily drafted and hastily amended in recent weeks without robust public participation, is a patchwork of political promises rather than a methodical reformation of Maine’s complicated electrical transmission and distribution system,” she said.

Scott Ogden of the Governor’s Office said, “In her veto message, the governor raised substantive concerns about the bill, including its governance structure, financing mechanisms, wording of the ballot measure, potential for protracted litigation, the manner in which the new authority would be regulated, and likely delays in the attainment of the state’s climate goals.”

He added, “However, the governor shares Maine people’s concern about Maine’s electric utilities. That’s why earlier this year she proposed, and the Legislature approved, a new law that reforms and strengthens the state’s approach to the oversight and accountability of Maine’s electric utilities.”

“I am a supporter of the transition from a for-profit multi-national corporation in control of a publicly granted monopoly to a publicly owned non-profit…,” said Rep. Valli Geiger, D-Rockland. “…I feel that CMP has lost our trust through their actions of the last several years.”

Sen. David Miramant, D-Camden, said, “All of my work on this over the last five years shows only benefits to Maine electricity users. The improvements in reliability and modernization of the transmission and distribution system by taking it out of the hands of the for-profit owners has been repeatedly proven in Maine and other states.”

Maine citizens are likely to make their voices heard on these issues at the polls next year.

Daniel Dunkle can be reached at ddunkle@villagesoup.com with feedback and ideas for news stories in Midcoast Maine.