February 2, 2023
Business Confidence Slips to Begin 2023
A strong performance by the Massachusetts economy during the fourth quarter of 2022 was not enough to stem…Read More
Posted on December 19, 2022
More Big Development Could Soon Land Alongside the BCEC
Boston Globe – The D Street corridor between the residential core of South Boston and the glassy towers of the Seaport is, for the most part, a wind-blown and charmless stretch of concrete and asphalt.
Maybe not for too much longer. The Massachusetts Convention Center Authority wants to bring more life to this boulevard, which runs along the eastern edge of the Boston Convention & Exhibition Center. Its latest effort to do so involves selling off development rights for two empty lots on D Street and a third behind two hotels on D, while the authority awaits legislative approval to expand the convention center itself.
The MCCA put these six-plus acres out to bid in late November, seeking developers to sign a 99-year ground lease to build on the three sites. The timeframe to assemble a bid, though, is unusually short, with proposals due Dec. 21, leaving just one month for developers to assemble teams and plans. The authority expects to pick a winner in the spring. The move also comes as Governor Charlie Baker, who appointed a majority of the MCCA board, prepares to leave office early next month.
Representative David Biele, a Democrat who represents South Boston, said the community should be included. He said he doesn’t understand the reason for the rush. “The public is entitled to a conversation around the future of what those state properties are going to be,” Biele said.
Boston-Area COVID Wastewater Levels Continue to Rise
Boston Herald – Boston-area COVID wastewater levels continue to surge in the days before holiday gatherings, as virus case counts keep rising and health officials urge people to get boosters and flu shots.
The virus wastewater data is the earliest indicator of COVID cases at the community level. The local levels have been going up for weeks, especially after Thanksgiving, and the data has continued to spike in the last week.
The seven-day average in the south-of-Boston region is now 1,347 viral copies per milliliter, which is up 87% since Thanksgiving. The north-of-Boston region’s seven-day average is now 1,179 viral copies per milliliter, which is a 144% surge. The sewage data has helped predict waves throughout the pandemic.
Meanwhile, the Bay State’s daily average of 1,199 COVID cases from the last week is up 12% from the daily rate of 1,071 virus infections during the previous week.
The state’s positive test average is rising again. The seven-day positive test rate is now 8.68%, up from 7.85% last week.
The state on Thursday also reported that 856 total patients are hospitalized with COVID, which is an increase of 90 patients from this time last week.
How Red Sox CEO Sam Kennedy Helped Charlie Baker Become the Next NCAA president
Boston Globe – On Wednesday night, Charlie Baker told Sam Kennedy with a laugh, “This is all on you.”
“This” is Baker’s new job, incoming president of the NCAA.
It is a role Kennedy, the Red Sox president and CEO, helped fill after being reached by Len Perna, an NCAA-affiliated headhunter who is the founder, chairman and CEO of TurnkeyZRG, back in September.
“[Perna] was describing what college sports needed and he started to walk me through the qualifications that they were looking for, and Charlie just immediately popped into my head, so I suggested that they have a conversation,” Kennedy told the Globe on Thursday.
“It’s so great that it came together. I’m so excited for Charlie and [Baker’s wife] Lauren and the family, and honestly, college sports, which needs this — badly.”
The NCAA is facing a number of legal challenges as it navigates a new landscape of NIL — name, image, likeness — which allows athletes to market their personas on an individual basis. Then, there’s the growing amount of money in broadcasting sports, particularly football, as conferences negotiate high-priced television and streaming deals.
Outgoing State Sen. Lesser Concerned about Lack of Economic Development in Western Massachusetts
Spectrum News – Outgoing state Sen. Eric Lesser (D-Hampden & Hampshire) is advising his community to be mindful of what he calls a growing divide between the eastern and western parts of Massachusetts.
Lesser did not run for reelection in the 1st Hampden &Hampshire District in January after running unsuccessfully for lieutenant governor in the Democratic primary this year.
He said while western Massachusetts may offer a great quality of life as far as open space and historical attractions, the lack of economic growth compared to the eastern part of the state remains a big issue.
“We’re not creating enough jobs” Lesser said. “We’re not attracting enough of those families to be able to stay here and build their lives and careers here. Eastern Mass. actually has in many ways the inverse challenge There’s a really red-hot economy there, a lot of great job opportunities, but it’s getting harder and harder to live there.”
Massachusetts will see changes in January when Attorney General Maura Healey and Salem Mayor Kim Driscoll are sworn in as governor and lieutenant governor. Both are from the eastern part of the state.
Lesser said while changes in politics are normal, he has faith certain western Massachusetts projects will still be completed.
New Bedford among Local Communities Awarded Grants through Seaport Economic Council
South Coast Today – The Baker Administration has announced more than $11 million in Seaport Economic Council grants for 24 projects, including in New Bedford, Fall River, Fairhaven, Dartmouth and Marion.
The grants will help 20 coastal communities advance projects that benefit commercial maritime industries, improve resident and visitor access to waterfront assets, mitigate the impacts of climate change, and advance future dredging. The grants were approved at Tuesday’s meeting of the Seaport Economic Council, chaired by Lt. Gov. Karyn Polito at Plymouth Town Hall, according to a press release.
“The Seaport Economic Council was created to enhance the strength and vitality of our port infrastructure, which is critical toward sustaining a strong economy,” said Sen. Mark Montigny, D-New Bedford, who led legislative efforts that created the council. “These investments will provide a significant boost to New Bedford and the Southcoast region, and I thank the Baker-Polito Administration for their ongoing support.”
‘It’s an Ugly Year in Health Care’: Hospitals Report Record Losses in 2022
Boston Globe – Hospital executives in Massachusetts had hoped 2022 would mark the beginning of their recovery from the financial losses of the past two years. Instead, many experienced their worst financial performance since their modern hospital systems were formed.
This week, several of the state’s largest health complexes reported multimillion-dollar operating losses for the 12 months ending in September, propelled by backlogs discharging patients to other institutions and an acute labor shortage that’s forced them to pay tens of millions of dollars for temporary help.
“It’s an ugly year in health care, there’s no two ways about it,” said Dr. Eric Dickson, chief executive of UMass Memorial Health.
Mass General Brigham, the state’s largest health system, reported a $432 million operating loss, the largest in its 28-year history. That figure beat the previous low mark of a $350 million loss in the first year of the pandemic.
Beth Israel Lahey Health, the state’s second largest health system, reported a $200.7 million operating loss, the first loss for a system that was formed by a merger in 2019.
Additionally, Tufts Medicine, previously known as Wellforce, reported a $398.6 million operating loss. And, UMass Memorial reported a $38.3 million operating loss, which was tempered by the sale of its $189 million stake in Shields Health Solutions in October 2021.
State’s Largest Insurer to Start Paying Providers to Address Health-Care Disparities
Boston Globe – Blue Cross Blue Shield of Massachusetts has signed agreements with four major health groups to hold providers financially accountable for reducing health disparities, a newer model of reimbursement that participants hope sparks lasting change.
Under the plan, health systems will be incentivized to achieve measurable improvements on metrics where there are preexisting disparities, including rates of screening for cancer, diabetes, and hypertension.
On Thursday, the state’s largest insurer said it had negotiated contracts with Steward Healthcare Network, Beth Israel Lahey Health, Boston Accountable Care Organization (part of Boston Medical Center), and Mass General Brigham. Each system agreed to reduce disparities within certain metrics to receive a predetermined reimbursement — and needs to eliminate the disparity to receive the maximum amount.
Claudine Gay Named 30th President of Harvard University, and Will be First Black leader
Boston Globe – Harvard University on Thursday named Claudine Gay, dean of the school’s faculty of arts and sciences, as its next president in a historic move that will give the nation’s oldest college its first Black leader.
Gay will face myriad challenges. Harvard announced the appointment at a time when it is embroiled in a battle over affirmative action in admissions that is being litigated at the Supreme Court, and as it confronts its historical ties to slavery.
In her first public comments following the announcement, Gay challenged the traditional notions of the “ivory tower,” and seemed eager to expand Harvard’s reach to new communities and groups, including historically Black colleges.
She said Harvard will “remain committed” to recruiting and admitting diverse student populations regardless of how the Supreme Court rules in 2023. During arguments in October, members of the increasingly conservative court appeared eager to declare the race-conscious admissions programs at Harvard and the University of North Carolina unlawful. Such a decision would overrule decades of precedent and require Harvard and other colleges to come up with new ways to build diverse classes.
“We believe very firmly in the educational benefits of bringing together a diverse community of learners,” she said at a news conference. “We will continue to champion the value of diversity irrespective of how the landscape around that might change.”
Former Lynn School Superintendent Named Secretary of Education
WBUR – Governor-elect Maura Healey has named a longtime public-school educator and former superintendent of the Lynn Public Schools as her education secretary.
Dr. Patrick Tutwiler is among Healey’s earliest Cabinet appointments to head a major division. As Secretary of the Executive Office of Education, Tutwiler will oversee policy concerning early education, the K-12 school system and higher education.
Tutwiler currently works as a senior program officer for education at the Barr Foundation, where he works to develop new high school learning models. His career in education spans more than 20 years. He began as a high school history teacher at Brighton High School. He’s since served in several school leadership roles such as assistant headmaster at English High School in Boston, principal at Wayland High School, and superintendent of Lynn Public Schools.
Healey says she hopes Tutwiler’s wide-ranging experience will help ensure that Massachusetts has a high quality and equitable school system.
“From his time working as a high school history teacher to leading a large, diverse, urban school district, he has earned his reputation as a consensus builder who puts diversity, equity and inclusion at the center of everything he does, and delivers results,” Healey said in a statement.
Healey Continues to Voice Support for Some Forms of Tax Relief
Boston Herald – Governor-elect Maura Healey is continuing her push for some form of tax cuts, hitting the airwaves Sunday where she repeated a campaign pledge to seek relief for vulnerable taxpayers in the new year,
“I’ve said for a long time that we need tax reform in this state,” she said. “Earlier in the year, I supported proposals to provide relief for seniors, low- and middle-income folks, renters and the like.”
Healey was speaking with hosts Janet Wu and Sharman Sacchetti during WCVB’s Sunday politics show On the Record, when she said conversations with the legislature about tax reform are in process and that lawmakers seem receptive to the idea.
“I’ve been in discussions with the legislature and I know that those discussions will continue. I think there is a shared interest and consensus in making sure that we are providing our residents and businesses with the kind of tax relief and tax reform that makes sense, that is going to help power us forward,” Healey said.
Healey was asked whether her position on tax relief extended to providing home sellers with a one time exemption from the state’s newest constitutional amendment, which will tax incomes over $1 million an extra 4%. Opponents of the measure have maintained that it will impact many older residents when they leave their homes.
Secretary of State Bill Galvin, when he certified the new amendment, issued a statement in which he said that the state needs to come up with a way to exempt seniors’ home sales from the tax.
Healey Taps Melissa Hoffer of the EPA to Serve as State’s First Climate Chief
Boston Globe – Governor-elect Maura Healey has named Melissa Hoffer, currently the principal deputy general counsel at the Environmental Protection Agency, as the state’s first ever Cabinet-level climate chief.
According to the Healey administration, Massachusetts is the first state in the nation to create such a position. In this role, Hoffer will be responsible for monitoring the progress on climate work across agencies and for centering the climate crisis in all aspects of the administration’s work.
“Melissa Hoffer is unstoppable. I’m thrilled to welcome her back to Massachusetts as our first ever Climate Chief,” Healey said in a press release.
Hoffer will step into this role at a time when experts say urgency is of the utmost importance. By the end of this decade, both state law and science dictate that the state must slash emissions to 50 percent below 1990 levels, en route to achieving net-zero emissions by 2050. Doing so will require rapidly scaling up the pace and scope of the current response to climate change — work that Hoffer will be responsible for overseeing and coordinating.
Prior to her current appointment in the Biden Administration EPA, Hoffer worked under Healey as the chief of the Energy and Environment Bureau at the Massachusetts Attorney General’s Office. At the attorney general’s office she led the litigation against ExxonMobil for its deceptive portrayal of the risks climate change posed to Exxon’s business and global financial markets, as well as the impacts of fossil fuels on climate change.
Wind-Energy Developer Files to Scrap Power Agreements
State House News – Declaring that the largest offshore wind farm in the state’s pipeline “cannot be financed and built” under existing contracts, Commonwealth Wind on Friday asked Massachusetts regulators to scrap the agreements the company reached with utilities and reopen a new round of bidding.
Commonwealth Wind filed a motion with the Department of Public Utilities seeking dismissal of the power purchase agreements it reached with utility companies in May, which would render them moot, and a reopening of the process of procuring the project’s 1,200 megawatts of clean wind energy.
If the DPU agrees, Commonwealth Wind said it would file a new, updated bid with more viable financial terms. That’s a risky step: utilities working with the Baker administration could opt to pick a different developer to replace offshore wind capacity and cut Commonwealth Wind out of the picture entirely.
The dramatic escalation comes after nearly two months of public back-and-forth about the viability of the planned offshore wind installation, with developer Avangrid arguing that a combination of economic factors including sharp inflation and the Russian war in Ukraine imperiled its ability to finance the project.
“We have to get to a point where the contract allows the project to go to financing, and under the current structure, it just isn’t there,” Avangrid Senior Vice President for State Government Affairs Kim Harriman told the News Service. “We have to be able to finance it, and frankly, we can’t do that with the current contract. So we think that going out to bid in 2023, that the state issuing that bid, will allow us to put in a contract proposal that reflects a project that we can finance.”
The DPU, which will remain under the purview of the Baker administration for about three more weeks until Gov.-elect Maura Healey takes office, will need to decide whether to approve Commonwealth Wind’s motion to dismiss the contracts or reject it.
A DPU spokesperson did not immediately comment Friday. Representatives for National Grid, Eversource and Unitil, the utilities with which Commonwealth Wind agreed to contracts in May, could not be reached immediately.
Gov. Charlie Baker said in November that his team had “no interest in reopening anything” and viewed debate about the contracts as “a discussion to take place between them and the utilities.”
“Let’s remember, these are long-term contracts, like really long-term contracts,” Baker said. “And while there may be some choppy water at the moment with respect to interest rates and supply chains and all the rest, we’re talking about a deal that basically lasts for 15 years, some of them more than that, depending upon what actually happens over that period of time. I think it’s premature for people to think that where we sit now is necessarily representative of where things are going to be over time.”
Commonwealth Wind said in late October that its proposed installation “is no longer viable” and could not advance under the terms of the contracts with utilities reached in May. The company at the time asked DPU to pause its review of the power purchase agreements so it could work on amendments with utilities, who had no interest in renegotiation.
After state regulators set a hard deadline for Commonwealth Wind to commit to its project or back away from the table, the company said it “believes there is a path forward” but would need to find a solution to “unprecedented economic challenges.”
Harriman said in the month since then, the utility companies with whom Commonwealth Wind contracted are “refusing to come to the table.”
“We are coming up to the end of the year, and time is slipping through our fingers, frankly,” Harriman said. “In order to avoid protracted litigation — I mean, you’ve got counterparties not even willing to talk and have said, verbatim, we’re not going to negotiate no matter what they say — it seems to us that the best way forward to deliver cost-effective clean energy for residents of Massachusetts is to move for this dismissal.”
Harriman said she is optimistic the project’s timeline, which eyes a start to operations by 2028, would not be upended if Commonwealth Wind secures new terms in a bid.
State law requires a new round of solicitation for offshore wind development within 24 months after the last round, which Commonwealth Wind attorneys said means the next cycle will need to open by May 7, 2023.
“Let me be really clear that we’re not abandoning this project,” Harriman said. “We are continuing to invest in the project and permitting and development as we prepare for this next solicitation. Really, this isn’t a pause or a stop. It’s just we’ve got to find a path forward.”
Avangrid is also involved in a pair of other renewable energy projects Massachusetts elected officials have eyed as key steps to green the electric grid. The company owns half of the Vineyard Wind I project, which is slated to begin delivering power as the nation’s first utility-scale offshore wind farm in 2023, and is also working on a contentious New England Clean Energy Connect project in Maine that aims to connect to hydroelectric power generated in Maine.
Here Is What Is Really Strangling the Energy Transition
New York Times (Opinion) – For generations, tobacco was the king of crops in the region known as the Carolina Sandhills, the best way to coax cash out of the sandy soil. But the long decline of smoking in America idled many tobacco fields, and now farmers are eyeing a new crop.
Instead of converting sunshine into bright-leaf tobacco, some of them want to convert it into electricity. This sunny region of the east-central Carolinas is an excellent place to build solar farms, with its plentiful land, sparse population, gentle terrain and need for economic development.
But the farmers, and the solar developers who are looking to cut deals with them, are stuck. The power lines running through the Sandhills region and a larger area of the Carolinas surrounding it are too small and antiquated to move solar power to the booming cities and factories where it is needed.
The situation is a microcosm of a large and growing problem.
Huge backlogs of renewable energy projects have built up around the world as developers are refused permission to pump their power into the grid. The projects go on waiting lists that can now stretch for years, and many ultimately drop off when the delays become intolerable. In the United States, enough renewable energy projects are backlogged right now to achieve a largely clean electric grid by 2030. But without urgent action, most are unlikely to get built.
You may have heard about the need for huge, continent-spanning power lines, operating at 500,000 volts or higher, that can carry enormous amounts of renewable energy from one region of North America to another. That need is real, and likely to become acute by the 2030s, but it is not what we are talking about here.
Instead, we are talking about the smaller, more local power lines running through state-designated transmission corridors. These lines, which you see strung alongside interstates and highways across America, generally transmit power at 115,000 to 230,000 volts.
In most places, the wires were designed decades ago and are just not fat enough to carry more electricity from solar and wind projects. Unless these lines are upgraded with new wires, connecting too many wind or solar farms could cause the cables to overheat, leading to power outages.
The problem is relatively easy to fix. The public rarely objects when old electric cables are swapped out for new ones along existing corridors. But the new technology does require investment, and that is the nub of the issue.
Electrical utilities have been caught flat-footed by the falling costs and rapid growth of renewable energy. They simply failed to get ahead of the wave and upgrade their wires, and the state governments that oversee the power business neglected to hold them accountable.
The same problem is erupting in other countries for many of the same reasons. In Germany, for instance, delays in grid development have prevented wind farms in the north from powering the industrial south, at a time when renewable energy is badly needed to offset the loss of Russian gas.
In the Carolinas, Duke Energy, which operates two of the region’s largest utilities, has finally come to recognize the need for upgrades. As a first step to tackle the problem, it wants to spend $560 million revamping power lines in a region it calls the “red zone,” which includes the Sandhills and much of the surrounding coastal plain in the Carolinas.
Unfortunately, state government lawyers charged with representing the public interest in matters involving North Carolina’s utilities fought that effort for several years, citing the cost, until relenting earlier this year. It is certainly fair to ask who should pay for such upgrades, given that solar developers and landholders stand to benefit.
But the energy transition benefits everyone, not least by helping to limit catastrophic changes in the climate. Moreover, a big build-out of renewable energy is likely to save the public money. Wind and solar projects do not require fuel to operate, whereas gas-fired power plants do, exposing electricity customers to the kinds of price spikes we are seeing right now.
We think it is reasonable to spread the costs of transmission improvements among all electric customers, as Texas did a decade ago, when it built major new power lines to move clean energy to market. Instead, power companies are often trying to charge these upgrade costs entirely to the developers of wind and solar projects, ignoring the broad benefits.
One of America’s most successful projects in the 20th century was the construction of the Interstate Highway System. Imagine if President Eisenhower had said: “We’ll eventually build a transcontinental highway system, but only to the extent that trucking companies can raise the funds among themselves to cover the upfront costs.” We’d still be fighting about it today. Instead, by spreading the costs across society, the Eisenhower administration got it done, to the enormous economic benefit of the entire United States.
Duke’s proposal to solve the congestion in the red zone is before North Carolina regulators now, and they could make a decision later this month. But beyond the Carolinas, a major push is needed all over the country. Discussions are underway among federal regulators about how they can help, but states often exercise more control over the power grid than Washington does.
In the near term, state governments need to treat this situation as the emergency it is. They already know where some of the worst bottlenecks are; the state commissions that regulate utilities should order rapid upgrades to resolve those. Unless states do this, they are at risk of losing out on the investment and tax revenue that new renewable energy projects will bring, not to mention the federal construction subsidies contained in the new climate law Congress passed this year. (Readers should note that we both work for companies that invest in the energy transition and would thus benefit commercially from a change in state policy.)
Beyond that, we think new procedures are required to make sure utilities stay ahead of the evolving needs of the grid, instead of constantly playing catch-up. One possibility would be to transfer planning responsibility for grid upgrades into the hands of independent technical committees empowered by states to consider the interests of all parties. Other solutions are possible, as long as they embody the critical need: planning far enough ahead to prevent big bottlenecks.
The public can help, too. In every state, a public utility commission is charged with regulating the power business, and for too long the decisions of these bodies have flown under the radar. As the climate crisis worsens and our goals for limiting the damage slip farther out of reach, citizens need to show up and make clear to the utilities and their regulators that they want action now.
Europe’s Energy Crisis Expected to Boost Demand for Oil as Heat Source
Wall Street Journal – A better-than-expected response to Europe’s energy crisis and surprising economic resilience among major Asian economies are boosting demand for oil as a heat source, the International Energy Agency said Wednesday as it lifted its forecast for global crude demand.
The Paris-based energy watchdog raised its forecasts for oil-demand growth for 2022 by 140,000 barrels a day to 2.3 million barrels a day. For 2023, the IEA also lifted its demand growth forecast by 100,000 barrels a day to 1.7 million barrels a day.
In a monthly market report, the IEA said global demand for gasoil—a fuel generally used to power industrial machinery—had exceeded its expectations in almost all parts of the globe. European nations, facing frigid temperatures, an acute energy crisis and high natural-gas prices, had seen a faster-than-expected switch to gasoil among manufacturers. Meanwhile, signs that China was set to ease its Covid-19 restrictions sooner than expected raised the IEA’s expectations for the nation’s oil demand.
The IEA’s optimism marks a modest improvement on the predominantly gloomy outlook surrounding demand that has pervaded the oil market in recent months. Despite continued tight supplies and fresh sanctions on Russia’s oil industry, which could further disrupt global crude flows, oil prices have fallen for the best part of six months as concerns about sluggish economies in Europe and China and rising interest rates in the U.S. have threatened to undermine demand.
Brent crude, the international oil benchmark, is down a third from its peak in June, and last week fell below $80 a barrel for the first time since January. On Wednesday, it rose 0.9% to $81.40 a barrel.
Europe’s efforts to find alternative fuel sources to replace lost Russian gas supplies were showing signs of progress, however, the IEA said.
“Europe’s manufacturing sector appeared to be weathering the gas crisis better than expected,” the IEA said. “As the continent enters winter, there is nascent optimism due to the view that an immediate energy crisis, and thereby the deepest recession scenarios, will probably be averted.”
Meanwhile, China’s steps to begin relaxing its Covid-19 lockdown measures had come earlier than expected, leading the IEA to bring forward when it expects Beijing to begin a full reopening of its economy from the second quarter of 2023 to the first.
For 2022, the IEA now expects total oil demand of 99.9 million barrels a day, 100,000 barrels a day more than it was expecting last month. For 2023, the agency expects total demand at 101.6 million barrels a day, 300,000 barrels a day more than last month’s forecast.
Less-developed economies that aren’t members of the Organization for Economic Cooperation and Development account for most of that extra demand, in part because of an improving picture for the Chinese economy, the IEA said.
Non-OECD demand would be 200,000 barrels a day stronger than forecast last month in both 2022 and 2023, the IEA said. The agency expects total non-OECD demand of 53.8 million barrels a day this year and 55.2 million barrels a day in 2023.
For OECD nations, the IEA kept its demand forecasts for 2022 steady at 46.1 million barrels a day as increased gasoil demand was countered by a drop in demand for naphtha, a feedstock for the petrochemical industry. For 2023, the IEA raised its OECD demand forecasts by 100,000 to 46.5 million barrels a day.
The IEA also lifted its forecast for global oil supplies. It added to its 2022 and 2023 forecasts each by 100,000 barrels a day, takings its predictions to 100 million barrels a day and 100.8 million barrels a day, respectively.
Nonetheless, the IEA said oil supply declined in November for the first time in five months, as major gulf oil producers—members of the Organization of the Petroleum Exporting Countries—reduced their output in line with the oil producers groups’ plan to reduce output.