Environmental advocates, tribal representatives and other stakeholders are cautiously watching the proposed sale of FirstLight Hydro Generating Co.’s U.S. assets, including the Northfield Mountain Pumped Hydro Storage Station and Turners Falls Dam on the Connecticut River, as they weigh what new ownership could mean for the future operation of the region’s major energy facilities.
According to Hull Street Energy’s May 19 announcement, the acquisition involves FirstLight’s portfolio of 1,400 megawatts of “clean, reliable generation in the Northeast.” It includes other hydroelectric facilities in Massachusetts, Connecticut and Pennsylvania, and additional solar and battery energy storage facilities throughout the Northeast.
The price of the sale has not been disclosed by Hull Street Energy, FirstLight or PSP Investments, the Montreal-based pension fund manager that is selling FirstLight USA LLC. The sale is also awaiting federal regulatory approval and is expected to be finalized by the end of 2026, according to Hull Street Energy.
Operational changes?
The country has seen a boost in private equity interest in medium-size hydropower projects and pumped storage hydropower, according to 2024 market research by the National Laboratory of the Rockies (formerly the National Renewable Energy Laboratory). Pumped storage hydropower facilities, specifically, will be more important as renewables are added to the energy grid, according to this report.
Based on research into 43 acquisitions of medium-size hydropower companies and pumped storage hydropower facilities over 10 years, private equity and venture capital funds have been moderately active in these corporate investments. Attractive investment qualities include the opportunity for stable cash flow and opportunities for “scalable technologies.”
While this market report focused on 10 years of data from projects up to 1 gigawatt, Hull Street Energy is still following this trajectory of hydropower investment growth. If the sales involving FirstLight and an additional 13 dams in Michigan are approved, Hull Street Energy would become one of the largest hydroelectric energy investors in the U.S., with a portfolio of 1,200 megawatts of pumped storage hydro capacity and nearly 400 megawatts of hydroelectric capacity, according to its May 19 statement.
The Northfield Mountain station has 1,168 megawatts of generating capacity. According to FirstLight, this facility helps support intermittent energy generation that comes from wind and solar. Water is stored in the station’s upper reservoir and water is released to generate power when electricity is needed most.
If this sale goes through, ownership would transition from a power generating company to a private equity firm, which rings alarm bells for Sarah Matthews, co-founder of Western Mass Rights of Nature. The group is a grassroots member of the global Rights of Nature movement that works to bring about legal and cultural change to recognize the right of the Connecticut River, its watershed and the life that it supports to thrive.
Matthews shared her concern over the profit incentive behind a private equity company owning an electric utility, both for the ongoing environmental impact of continued pumped storage on the Connecticut River, which a new license with more storage capacity could further impact, along with the financial impact on energy consumers.
“The impact of a private equity company owning an asset that is providing an essential service to people, that often ends up in conflict, because the private equity company only cares about profits, whereas the people have needs that may not get met,” Matthews said. “It may not end up being in the best interest of the people financially, like in the energy market, or might not end up being in the best interest because they’re destroying the river.”
When asked if there are operational changes anticipated at either the Turners Falls Dam or the Northfield Mountain Pumped Hydro Storage Station if Hull Street Energy finalizes the sale with FirstLight, Hull Street Energy spokesperson Natalie Joubert stated, “As noted in our release, we look forward to partnering with the accomplished FirstLight team to deliver safe, sustainable, reliable and affordable power to customers.”
University of Massachusetts Amherst professor Eve Vogel, who studies the politics, history and policy of sustainable rivers and electric systems, said she would foresee operational changes based on energy market demands as renewables are brought online, rather than due to a shift to private equity ownership.
“My top worries are political influence at the state, federal and [independent system operator] level, and then No. 2 would be a future bankruptcy as markets and resources change,” Vogel said.
Additionally, Vogel shared her concern over transparency of operations, including how open the company will be about discussing operational costs and profits, as well as willingness to release data pertaining to water levels, flows and related impacts.
Andrew Fisk, Northeast regional director for the nonprofit American Rivers and former director of the Greenfield-based Connecticut River Conservancy environmental advocacy organization, said that, while he could not speak to Hull Street Energy specifically, there have been instances of purchases of renewable energy fleets where the private equity firms have not successfully managed due to lack of experience in hydropower.
“Often, that’s the acquisition of pretty small facilities. The FirstLight facilities … are well-resourced. They’re large, sophisticated facilities,” Fisk said. “They’re not the same as private equity purchasing a 2-megawatt facility located on a tributary system.”
Questions on impact on relicensing, tribal relations
The acquisition of FirstLight’s properties comes during the federal relicensing for the Turners Falls Dam and Northfield Mountain projects, which have both been operating on a provisional license since 2018. The company is seeking a 30-year to 50-year license for the two facilities.
The Federal Energy Regulatory Commission (FERC) issued its Final Environmental Impact Statement in February, giving the green light for the projects to continue the relicensing process, despite pressure from a variety of local stakeholders who push for greater environmental protections within the license conditions.
The Nolumbeka Tribal Coalition, made up of the Nolumbeka Project nonprofit, the Abenaki Elnu Tribe and the Chaubunagungamaug Band of Nipmuck Indians, has also consistently sought recognition and protection of Native American artifacts within the Connecticut River, as well as the cultural sites in and around the river that are not presently recognized by FERC, or FirstLight, as part of the 2015 Traditional Cultural Properties survey.
Hull Street Energy stated in its original announcement of the proposed purchase that the sale would not impact the ongoing relicensing of either facility. When asked for greater detail, Joubert reiterated simply, “The change in FirstLight’s ownership will not affect ongoing relicensing efforts.”
“The company will continue to operate as FirstLight but under new ownership,” FirstLight spokesperson Claire Belanger said in a statement when asked the same question. “Therefore, there will be no impact on the relicensing of FirstLight’s facilities.”
Former Nolumbeka Project President Joe Graveline shared concern over what a change in ownership might mean for tribal relations and protection of the Connecticut River, even if FirstLight employees are coming under the Hull Street Energy umbrella. PSP Investments previously stated that FirstLight’s employees will “transition with the assets under Hull Street Energy’s ownership.” According to Belanger, 220 employees work at FirstLight properties in the United States and Canada.
“My sense is,” Graveline said, “that they’re not going to hold onto this project. They’re going to sell it. It’s musical chairs.”
The Turners Falls Dam and Northfield Mountain projects were owned by Northeast Utilities from 1999 during the time of electric market structuring through 2006, when it was sold to Energy Capital Partners in 2006. Energy Capital Partners created FirstLight to manage the portfolio. Then, in 2008, the properties were sold again to GDF Suez before being sold to PSP Investments in 2016.
Since news of the proposed sale has gone public, Graveline said the tribal coalition has not heard from FirstLight about the pending acquisition. Belanger said, however, that municipal officials have been contacted over the change in ownership.
FERC is recommending continued consultation with participating Native American tribes in the relicensing process in the event that a new license is issued. While Graveline and other tribal coalition partners have previously voiced a lack of confidence in what continued consultation with FirstLight might look like, he’s more unsure about what having a new company at the helm could mean for communication.
“Both FERC and FirstLight have been communicating with us for years,” Graveline said. “Somebody needs to start talking to us.”
Matthews shared a similar sentiment on the relationships that have been developed with FirstLight over the years, and what the future may look like for communities who’ve come to know and work with their staff.
“We have something that is this vital and having such an enormous impact on the communities along the river,” she said of FirstLight’s properties. “To have it change hands is sort of worrying for people.”
