$815 BILLION: The Cost of Going Green in New England
The push for net-zero and electrification will dramatically increase the cost of energy in New England
States in the New England region, except New Hampshire, have been pushing for so-called “green” energy policies for years. These policies include transitioning their electricity grids to net-zero emissions using primarily wind, solar, and batteries and electrifying transportation and home heating—all by 2050.
Electricity prices in New England already surpass those in most of the United States and are among the fastest-growing in the nation. If New England succeeds in its electrification and carbon-free agenda, prices will continue to rise.
We recently modeled the cost and reliability impacts of achieving New England’s green energy policies for a network of think tanks in the region, and our analysis found it would cost an additional $815 billion through 2050.
The report, “The Staggering Cost of New England Green Energy Policies,” was published in November. This will be Part 1 of a series highlighting our findings starting with the cost to New England families and businesses.
New England: Historical Costs
The New England region has the second highest electricity prices in the nation, as the chart below shows, and the highest in the contiguous United States.
And while electricity prices in New England have typically always been higher than the national average, they haven’t always been this bad. Residential prices in the region were around 30 percent higher than the national average as recently as the 2010s. Today, they sit at 80 percent higher.
That’s because, since 2001, New England's residential electricity rates have grown at the highest rate of any other region.
This dramatic rise in the cost of electricity in New England can partially be attributed to the strategy of its energy policies up to today, which included retiring coal, oil, and nuclear facilities and replacing them with mostly natural gas, wind, and solar.
From 2005 to 2023, New England replaced roughly 5,600 MW of coal, oil, and nuclear capacity with nearly 10,000 MW of gas, wind, and solar despite electricity demand falling by 13 percent.
This strategy has deteriorated New England’s fuel diversity, and the region is now over-reliant on intermittent energy sources and the swings of natural gas prices.
In other words, “green” energy policies in New England have already had negative consequences. While this would be a good reason to pause and return to affordability-focused energy policies, no state but New Hampshire has pressed the brakes on the net-zero agenda.
Doubling Down on Failed Policies
Despite the ongoing failure of New England’s green energy policies, the region has largely doubled down in recent years.
Five out of six states in New England have enacted policies, all within the last five years, pursuing net-zero and carbon-free goals, and many have enacted policies to electrify the transportation and home heating sectors.
The question we set out to answer is: what are these policies going to cost the people, families, and businesses within New England?
The Staggering Cost of New England Green Energy Policies
Total Capacity
To find the cost of New England’s “green” energy policies, we first had to determine the total capacity needed to achieve them.
To this end, New England would not only need to replace existing thermal generators with less reliable, intermittent energy sources like wind and solar, but it would also need to build enough capacity to meet growing electricity demand from electrifying transportation and home-heating.
Our modeling concluded that New England would need to build 6.4 times the amount of capacity it currently has on the grid, totaling over 225 gigawatts (GW) of generating capacity (nameplate) by 2050 - up from 35 GW today. This includes 66 GW of offshore wind, 19 GW of onshore wind, 68 GW of solar, and 43 GW of battery storage. This figure also includes over 20 GW of natural gas.
These estimates were based on demand projections (for both peak demand and hourly load shapes) from ISO-NE, which include the impact of electrification from all New England states. These projections were reduced to reflect our assumption that New Hampshire opts out of the net-zero and electrification push from other New England states.
Total Cost
Building, operating, and maintaining the required capacity to achieve New England’s “green” energy goals will cost families and businesses an additional $815 billion through 2050 (in real 2023 dollars), meaning these costs are in addition to current costs.
This would more than double electricity prices for every sector (residential, commercial, and industrial) in New England, as the all-sector electricity price would increase from 22.78 cents per kilowatt-hour (kWh) to 51.58 cents per kWh.
Residential customers would end up paying an extra $214 per month – or $2,500 per year – on electric bills by 2050
Additionally, industrial customers would see costs increase by over $130,000 annually.
This would likely continue driving large industries out of the New England region, which would spread the enormous costs of achieving net-zero and electrification over the remaining customers – mainly small businesses and families.
What If New Hampshire Followed?
The one island of energy sanity in New England is New Hampshire, which is the only state in New England that hasn’t increased its original renewable energy goal of 25 percent.
Lucky for New England, but not for New Hampshire.
By not following the same energy policies as the rest of New England and effectively reducing the demand that the system would need to support, New Hampshire saved the region an additional $56 billion through 2050.
Had New Hampshire followed the electrification push, New England would have needed to build an additional 15 GW of net capacity. Instead, New Hampshire continued to supply the grid with much-needed thermal production during times of wind and solar droughts, saving the region billions of dollars.
Unfortunately for New Hampshire, by sharing the same grid, they will also share the increased costs resulting from the policies of their neighbors.
Conclusion
The energy policies of most New England states, prioritizing emissions reductions over affordability and reliability, will lead to a massive increase in the cost of electricity for families and businesses in the region and continue the growing price disparities with neighboring regions.
In the next part of the series, we’ll go over the all-in cost of each energy source on the system, comparing the cost of existing thermal generators with that of new wind and solar facilities after accounting for overbuilding, curtailing, and load balancing.
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As energy champions go, Chris Wright has an important distinction by
Utility-scale batteries are as expensive as nuclear power by
I do want to point out the natural gas price swings in New England are much higher because of a multi-decade fight against gas transmission lines into the area. New England is woefully short on gas transmission capacity.
What is the point of describing increasing weather related damage to our grid infrastructure? New England states’ push to increase reliance on electricity while promoting weather-dependent unreliable ‘green’ electricity sources is insanely counterproductive and wastefully expensive. The vast gas reserves in PA should be used to power gas generating plants here while building out more nuclear for long-term lower cost reliable low-carbon electricity. But NY has banned any new gas pipelines transiting their boundaries preventing New England from accessing the lowest cost source of reliable electric generation. Why are our politicians not actively trying to reverse New York’s stranglehold on our region’s legitimate needs? We currently depend on vastly more costly LNG supplied by tanker ships from Caribbean ports.