Election day in November, 2023, was a disappointment for advocates of state-owned, community and nonprofit public utilities. The referendum on establishing a state managed public utility system in the State of Maine was decisively defeated by 30% of voters in favor against 70% who opposed it. Despite this defeat, supporters of non-profit community energy resources for the people of Maine, accountable to the state’s residents and not investor capitalists, were determined to continue their struggle for democratic utility ownership.
The referendum, known as “Question Three”, posed this question to voters: “Do you want to create a new power company governed by an elected board to acquire and operate existing for-profit electricity transmission and distribution facilities in Maine?” A “Yes” vote would replace existing for-profit investor-owned companies with a non-profit customer-owned utility, the Pine Tree Power Company. Although there are public-owned utility companies at the federal and local level, had the referendum passed Maine would have become the first state to have a state-owned utility company provide electrical service to the entire state.
The referendum came about as the result of widespread, deep dissatisfaction with the for-profit utility companies in Maine that accompanied numerous power outages, rapidly rising rate increases, poor service and numerous other inefficiencies. Consumer dissatisfaction with electrical service was greater than almost every other state in the country. Despite this, profits increased for capitalist investors many of whom were invested in the multinational, global energy cartels that managed electrical power to Maine consumers. Instead of operating revenue circulating back into the state’s economy, whatever surplus revenue was generated by rate increases went to fatten the bank accounts of overseas investors in multinational utility companies and global energy cartels.
The crisis of relying on investor capitalism to deliver electrical power to Maine residents began several years ago, as service became increasingly poor and inefficient even as profits for investor-owned utilities increased dramatically. In response to consumer dissatisfaction, public advocates, environmental activists, as well as local and state officials began to explore the options and alternatives to increasing reliance on monopoly capitalism to deliver energy to Maine residents cheaply and efficiently without damaging the environment. The most popular proposal was for a consumer owned, state managed public utility to take over private utility companies that were poorly managed and very inefficient at delivering electrical service to Maine residents. Eventually, the proposed public utility company would become known as the Pine Tree Power Company.
As proposals for a community owned and managed power company became increasingly popular and discussed, state legislators in Maine began to take notice and embraced the concept of a state utility company to replace private utility companies and provide service for all of Maine’s residents. Within a few months a bipartisan majority of the state legislators voted to pass a bill facilitating the creation of a state managed utility, the Pine Tree Power Company, to take over the private utilities and provide environmentally friendly, superior and cheaper service to Maine residents. Unfortunately, despite overwhelming and bipartisan support for the creation of a public utility to replace private companies, Democratic Governor Janet Mills vetoed the bill claiming that the enforcement language was too vague and insufficient clarity on how much the takeover bill would cost, as well as lack of financial specifics as to how Maine taxpayers and ratepayers would be responsible for providing sufficient capital resources to enable the law’s implementation. Of special concern was language in the bill that was very vague as to how bonds to finance the takeover would be issued, and more importantly whether those bonds would be exempt from federal taxation.
Shortly after the Governor’s veto of the public utility bill, proponents of nonprofit consumer ownership switched strategy to focus on gathering enough signatures from Maine voters to put the question of community ownership on the ballot as a public referendum. Their goal was to place the question on the ballot for the general election in November 2023. Despite more than enough signatures to place the referendum on the ballot, significant legal and logistical hurdles remained to be resolved. The original language describing the referendum referred to the Pine Tree Power Company as a “government agency” despite the fact the consumers and ratepayers would actually own and manage the company. A superior court judge threw out that language to be replaced by describing Pine Tree as “a new power company governed by an elected board” The damage was done, however, and the result was confusion among voters as to whether Pine Tree Power would become a state agency managed by politicians or operate as a consumer cooperative owned by and managed for the benefit of customers and ratepayers.
One significant reason for the importance of community-owned cooperative electrical service is the greater likelihood of connecting renewable sources of energy to the state’s power grid. For-profit utility companies are much less likely to embrace renewable energy if there is not enough profit to satisfy investor demands. Climate change activists in Maine support Pine Tree Power as a non-profit source of renewable energy in the fight to reduce the harmful effects of climate change, rising sea levels and global warming. Given Maine’s reliance on the tourism industry, the threat global warming poses to shore communities and ski resort operators makes a compelling argument for greater reliance on renewable energy sources and reducing the use of environmentally harmful fossil fuels.
Even before the petition to establish Pine Tree Power was placed on the November, 2023 ballot referendum, opponents comprised mainly of groups and organizations affiliated with predatory utility companies and other capitalist interests began to mobilize their considerable resources to influence the outcome of the election. In addition to spending millions of dollars on traditional media outlets, TV, radio and print journalism, opposition groups also spent millions more on consultants and influence peddlers to exploit social media with distortions, fake news and misinformation to turn voters against the ballot question. Among the propaganda put out by special interests was to greatly exaggerate the cost of a utility buy-out, with estimated cost to ratepayers of more than three times the book value of all private utilities in Maine. Up to the election more than $37 million was spent by opponents in contrast to less than a million dollars spent by supporters of the referendum. Voters in Maine were bombarded by ads on TV, radio, newspapers and social media opposing the referendum, while proponents of Pine Tree Power had no TV ads or other advertising media.
Another hurdle against passage of the referendum came, ironically, from a very unlikely source. Chief among opponents of the referendum were labor unions, including the state’s AFL-CIO, representing utility, electrical and other workers in related industries. Part of the reason for this was confusion over language in the referendum which implied Pine Tree Power was a state agency rather than a consumer-owned utility cooperative. Union workers were fed all kinds of propaganda inferring that their contracts would become null and void, that they would lose their collective bargaining power and leverage over management decisions if they were considered to be state employees. They were also fearful that if they were treated as state employees their right to strike would be limited as well. Given the outrageous exaggeration over the cost of a utility buy-out, workers were also concerned that they would become subject to layoffs if there was insufficient revenue to pay the outstanding debts and costs related to implementing the Pine Tree Power takeover.
Given the tremendous financial, political and organizational advantages possessed by opponents of Pine Tree Power, it was no surprise that the referendum went down to defeat by more than two-to-one margin. Despite the overwhelming defeat, organizers of the referendum will continue their push for greater accountability and community participation in providing reliable, safe, affordable and climate-friendly electrical service to Maine residents and customers. Before deciding their next step, supporters of Pine Tree Power will consult with other groups and activists whether to pursue other options. One very important step forward would be to work with and collaborate with labor leaders and other groups representing workers in the affected industries. No campaign for a consumer-owned public utility can be successful without active participation by labor unions and the workers they represent. In any proposal workers must be guaranteed fair wages, benefits, job security and collective bargaining. The next election for statewide political office, especially Governor, will be another opportunity to establish Pine Tree Power legislatively, negating the influence of monetary expenditures to influence and misinform voters. The best way to sum up the dilemma facing supporters of people-managed public utility companies, according to the deputy manager of the Pine Tree Power campaign, “Thirty-seven-to-one is a huge spending margin. We were never on TV. We won 100,000 votes, a third of the state, without ever going up on television.” For now, predatory capitalism triumphed over the people’s interest, at least in Maine. But that could change after the next election.
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