Sparks flew between the Energy Task Force and a camp supporting a power cable to the mainland during an August 7 meeting.

At the meeting task force members also acknowledged that the probability of the town purchasing the power company is slim and a company official said it is in private talks with state officials about installing a power cable to the mainland.

The meeting came just weeks after island power users received bills that charged about 65 cents per kilowatt hour, giving them the dubious distinction of paying the second highest electric rates in the county, according to the U.S. Energy Information Administration. Only customers of a company going out of business in Texas pay more.

Power cable debate

In the face of rapidly rising energy costs, the island task force has proposed a three-pronged approach in a grant submitted to the U.S. Department of Agriculture in June. The $3.9 million grant application asks the department to fund initiatives to help low-income residents conserve energy, the construction of a 600-kilowatt wind turbine and outfitting of municipal buildings with solar power. The group remained opposed to supporting a power cable to the mainland — at least as it’s currently proposed.

“We took great pains and a lot of math to look at different options and the cable did not come out favorably,” task force member Chris Warfel said.

Warfel and the task force said the price of laying a cable would be cost prohibitive. It would be cheaper, task force members argued, to invest in renewable energy projects on-island that remove the island’s dependency on fossil fuel. The members argued that a cable was a short-term solution that would still draw its power from plants that use non-renewable fuel and fail to insulate the island from the rising costs of energy.

In March the U.S. Department of Agriculture turned down a $5 million grant request from the Block Island Power Company (BIPCo) that would have helped fund the installation of power and fiber optic cables for $17 million. A consulting firm hired by the company also recommended against installing a cable, calling it a poor financial investment in the long run.

But last week grant writer Mary Jane Balser told the task force that its stance opposing the power cable was wrong and without lower electric rates the island economy would suffer. She said businesses can only conserve so much and the island is not an ideal spot for wind power.

“You don’t give facts,” she shouted. “You have chosen to ignore them.”

Balser told the task force that it would cost about $13 million for the installation of a power cable if extras such as distribution upgrades and an accompanying fiber optic cable were taken out. By her calculations she said the cable would cost $750,000 a year for 30 years with a 5 percent loan.

Some task force members, however, remained skeptical.

“If it’s economically viable why isn’t the private sector making this investment?” Bill Penn asked Balser.

Despite repeated requests by Penn, Balser never directly answered the question, instead changed the topic to the Water Company and how prior mismanagement there led to higher rates for the town, leading task force Chairman Dr. Tom Cardello to end the conversation.

“The idea is to communicate ideas, not go on rants,” Cardello said.

BIPCo talks

The task force learned that BIPCo is in talks with “people” in the government about obtaining government funding for a power cable. BIPCo co-owner Cliff McGinnes said if funding comes through the company could install the cable for as little as $5 million. He added though that the installation of a cable was still dependent upon the support of the town.

But when the task force pressed him for more details about where the money would come from and whom he was speaking with at the state level, McGinnes was reticent.

“I’m not going to tell you who it is because I’m meeting privately with people,” McGinnes said when members asked him for a point person.

He asked that the task force and town support him in his request, but members said they couldn’t support a request he wasn’t willing to share with them.

“The ball’s in your court,” Penn told McGinnes.

Town Manager Nancy Dodge suggested BIPCo allow one member of the task force to participate in the discussions with the state officials to eliminate the competing proposals and put everyone on the same page.

McGinnes said he would be open to such a representative “as long as the member doesn’t think I don’t know how to run the power company” he said alluding to prior comments Warfel made about the management experience at BIPCo.

BIPCo purchase

After numerous closed sessions, the task force said last week that it was unlikely the town would purchase BIPCo.

“I don’t think the town is going to run its own power company,” Cardello said. “I don’t think that’s in the cards.”

Penn added that the task force would not recommend the town purchase BIPCo because of the complexity involved with running such a utility. But Cardello said it was not out of the realm of possibility for a homeowners’ cooperative to run its own power company. But as residences or businesses move off the grid, the overhead costs would remain mostly the same for the power company and could place a larger rate burden on the remaining customers, Cardello warned. He said task force members would continue to discuss the implications of such a cooperative, during closed sessions.

Charges of inaction

Town Councilor Dick Martin complained to the task force that it appeared to be moving slowly with its recommendations.

“I thought we put experts out there and you’re asking us to solve your problems,” he said in response to a request from the commission asking for ideas on how to lower energy costs.

Martin said last week’s meeting was the first open meeting since the task force was created a year and a half ago.

Task force members told Martin that it was not the first open meeting, and that it needed time to carefully weigh all the repercussions of any recommendations.

“There are many ways this cat could be skinned,” Warfel told Martin. “You know what our charge is and we’re trying to do it in a way that harms no one.”

Warfel said the task force was treading a “balancing beam approach” meant to ensure that by helping one sector, it wouldn’t push the costs onto another group of customers. And the task force members noted the recommendations for the USDA grant went before the Town Council during an open session. The task force also agreed last week to start searching for alternative funding if the USDA turns down the grant.

Still, Chamber of Commerce Executive Director Kathy Szabo told the task force that it needs to remember energy prices affect not only large businesses.

“You guys have to step it up and try to help everyone, not just the big businesses,” Szabo said.

Legal bills

Balser and the task force sparred over the town’s decision to hire lawyers to fight BIPCo every time it requests a rate increase. Balser said the town normally loses and the cost of the lawyers on both sides is ultimately passed down to her in the form of increased rates and increased taxes.

“All I do when you fight the electric cost is pay more on my electric bill,” Balser said, who owns Block Island Grocery.

Warfel said fighting the rate proposals was about more than simply trying to lower the rates.

“They were fighting an approach to management,” Warfel said. “I just think it’s all about rate design and a lot of these costs are being pushed on the wrong people.”

In the past BIPCo has opposed a rate design study. Last week McGinnes said the company remained opposed to a study because of its potential cost.

However, he added that the company would like to see a single rate for the year-round residents but the Public Utilities Commission has objected to such a move, preferring instead a system of rates that vary by season.