Last week, on election day in the U.S., the state of Maine rejected “Question 3” on the ballot, scraping the idea of eliminating the state’s pair of investor-owned utilities and replacing them with a new nonprofit power company for the entire state.

Voters rejected the Pine Tree Power idea and will continue to work with the only two utility companies in the state; Central Maine Power (CMP) and Versant. CMP is owned by Avangrid (a subsidiary of Spanish multinational utility Iberdrola), and Versant is owned by ENMAX in Canada. Had the ballot measure succeeded, Mainers would have bought out the two companies, which together handle more than 96 percent of the state’s electricity demand, and establish a new, unified nonprofit utility called Pine Tree Power. The ballot measure lost by a considerable margin, with 71% of voters opposing it and only 29% supporting it​.

Many in the climate space see this as a bellwether for climate policy in the U.S. Nebraska is the only state where consumer-owned power suppliers provide 100% of the state’s electricity, and had Maine supported Pine Tree Power, the deal would have made Maine a model for other states to follow.

Big Power Pulls out the Financial Knives

CMP and Versant spent more than $40 million to defeat Pine Tree Power, according to Grist. The two companies outspent advocates by 34 to 1. Our Power, the advocacy group behind Pine Tree Power spent just $1.3 million.

That’s not uncommon for either power company, which has actively lobbied against climate change initiatives in the past. According to The Washington Post, in 2017, Central Maine Power and Republican state lawmakers helped kill a pro-rooftop solar bill. CMP and Versant both launched super PACs to advance their goal of killing Question 3, which would have essentially put both power companies out of business in the state.

The big spend succeeded in convincing Mainers to reject the proposal by arguing that it would cost more than advocates said it would, lead to higher rates for customers, and years of legal battles. Even the Democratic Governor of Maine, Janet Mills, who has called for the state to go all in on green electricity by 2040, spoke out against the proposition, arguing that it would lead to long, drawn-out legal battles.

Advocates said that buying out the utility companies would have cost anywhere from $8.25 billion to $13.5 billion, and would have allowed for easier green energy transition. Maine has some of the highest energy costs in the country, coupled with one of the most unreliable grids. They also underscored the fact that both CMP and Versant are owned and operated by foreign companies, who would have almost certainly fought the proposition in lengthy, expensive, and drawn-out court proceedings.

Customers have accused both companies of charging exorbitant rates, exacerbating prolonged outages, and having poor customer service. It has been egregious enough that in past years, state regulators have fined CMP $10 million for improperly sending disconnection notices to hundreds of customers and misbilling hundreds of thousands. CMP has also been accused of dragging its feet when connecting solar projects to the grid. CMP also lobbied hard to kill a rooftop solar program in Maine in 2017. CMP and Versant control over 96% of Maine’s electricity demand.

CMP and Versant attacked the project's estimated cost. Supporters did not offer a counter to the argument, noting that a judge or other third party would ultimately decide just how much it would cost Maine consumers. Our Power, the advocacy group that supported the referendum, argued that they would have negotiated the lowest possible price for the transition and said that any legal challenges could have been resolved within three to four years.

The median income in Maine is around $63,000 per year, which is below the national median income of around $69,000 per year, and a multi-billion dollar project would be difficult for customers to cover.

What is clear is that Mainers need a utility revamp, but after the defeat of Question 3, the path forward is unclear.

What the Outcome Means for Climate Bills Around the Country

While other localities like Winter Park, Florida, and Jefferson County, Washington, have successfully taken over their grids, Nebraska is currently the only state where consumer-owned power suppliers provide 100% of the state’s electricity. Maine would have been the second state to move in that direction had Question 3 passed, and represented the largest effort for public control of the grid to date.

At the heart of the issue that climate advocates focused on was connecting green power projects to the grid, something that most utility companies have been slow to implement. Those who support public power say that energy should be affordable, reliable, and accountable to its customers and argue that the only way to achieve those goals is by creating a publicly managed and owned electric grid. As Grist notes, advocates say that “only a publicly owned and managed electric grid can rise to the challenge of climate change by providing renewable power as a public good and serving the needs and interests of the people using it, rather than shareholders.”

The vote in Maine was closely watched by other leaders in states like New York and New Mexico. Three-quarters of customers in the U.S. are served by investor-owned utilities, and as the confluence of high electricity rates, exceedingly slow transition to renewable energy sources, and increasing incidence of massive storms and events that result in long and frequently dangerous blackouts come together, the appetite for publicly owned utilities has increased. Clearly, however, there is a limit to just how much voters are willing to spend on the green electric grid transition.

While many climate advocates around the country were keeping a close eye on the outcome of the referendum as a bellwether, those who supported Question 3 say that the fight is far from over. We’ll continue to keep an eye on what shakes out with other climate-focused referendums around the country to get a better understanding of just how the green grid transition might shake out.

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