Photo: The 60-megawatt Blair Pond substation off Brighton Street.
After being delayed for several days to resolve a last-minute tax dispute, the most expensive transaction in the Town of Belmont’s history was approved Dec. 15 when the Light Board OK’d the sale of the newly-constructed Belmont Light’s 60-megawatt Blair Pond substation off Brighton Street and three new 115kV transmission lines to utility giant Eversource for $45 million.
The push back of the agreement’s closing date was due to an objection initiated by Selectman Sami Baghdady – the Board of Selectmen makes up the Light Board – who questioned Eversource’s assumption it was exempt from paying local taxes on contractual services which would reduce its tax burden to the town by nearly 90 percent.
In the end, the town’s contention made by Town Assessors’ Chair Robert Reardon that Eversource would be required to pay the full tax won the day as the utility will send an estimated $350,000 in annual taxes to the town.
The $45 million for the new cables and the 10,000 square-foot electrical substation off Brighton Street on Flanders Road on the Cambridge line will be used to pay off the $26 million in short-term loans used to construct the project.
The town’s new system that is connected to New England Electric Grid at Alewife will provide “an effective energy distribution solution for Belmont residents and businesses for the next forty years,” stated a press release from Belmont Light
In February 2012, Belmont Town Meeting voted unanimously to authorize $53.7 million in new bonding capacity to finance the new system which doubled electrical capacity increasing reliability for Belmont customers.
In its Joint Development Agreement, Eversource reimburses Belmont $45 million for the cost of constructing the transmission line and for the utility to take permanent ownership and maintenance responsibilities for the transmission line moving forward.
With the transfer of ownership, Belmont’s construction costs for the Blair Pond Substation and Transmission Line project, anticipated to be $53.7 million, closed out at $26.1 million, a $27.6 million savings for Belmont ratepayers.
A corresponding rate increase associated with the cost of this project that was initially anticipated to be approximately 14 percent for Belmont Light customers is instead 6 percent, an increase that has already been factored into rates, according to Belmont Light calculations.
“At the end of the day, in working with Eversource, we [can] deliver a critical project for Belmont electric users that addresses our serious capacity concerns, skyrocketing maintenance costs and power quality issues, in the most modernized and efficient manner,” said Belmont Light General Manager Jim Palmer in the press release.
“Just as important, due to our agreement with Eversource, we are able to do so substantially under the original cost estimates approved by Town Meeting and save the Belmont ratepayers $27.6 million while providing the best possible solution for our future needs.”