Library filed under Impact on Economy from Delaware
Advocates for such renewable, carbon-free sources of electricity are in full defense mode, as recession-battered consumers blanch at the modest added costs required to shift to cleaner power and resurgent Republicans rail against government subsidies or carbon-control programs that might add costs for businesses and "kill jobs."
A Delmarva Power consultant estimates that three land-based wind contracts will cost residential customers the equivalent of 24 cents more a month over the life of the contracts. The estimate was part of a package of financial information Delmarva has submitted to the Public Service Commission, which will consider approval of the company's land-based wind power contracts in the coming months.
Delmarva Power signed a landmark offshore wind power deal with Bluewater Wind on Monday, agreeing to buy enough power to light 50,000 homes in Delaware for the next 25 years. The long-awaited, $800 million deal could make Delaware the first state in the nation to build a wind farm off its shores. An array of as many as 70 towering windmills would rise in a tract east of Rehoboth Beach by 2012. ...Both parties agreed the contract will cost average residential customers about $5 a month more -- over the 25 years -- than they would have paid for electricity without offshore wind power. With volatile fossil fuel prices, no one can predict how much additional cost -- or savings -- customers may see over the life of the contract.
The Bluewater Wind offshore wind farm proposal exploits the Delaware Renewable Portfolio Standard Act intended to foster the use of renewable energy sources. ...To qualify as an electricity supplier, BWW has to offer a supply that meets customer needs all the time, not just to the extent the wind blows. The BWW proposal drafts Delmarva as its supply partner, reducing supplier competition. Further, Delmarva's SOS customers may lose the right to choose another supplier if the BWW take-or-pay wind and Delmarva backup power partnership proves expensive. They could be locked in for 25 years.
In the meantime, Bluewater Wind continues to make promises to Delaware Lt. Governor, John Carney, who met with company officials recently says, they have an idea for pumping 150-grand into Delaware Tech. "They want to set-up a regional training program here for wind turbine technicians here in Delaware. The commitment to build the regional hub here for installation of the wind farms as well as the training program to provide training for workers to operate and maintain the turbines once they are installed is contingent upon approval of the project."
The cost of offshore wind power could be cut in half if all Delmarva Power customers were required to participate, a state consultant said in a report issued Thursday. The report, which was mostly favorable toward the offshore wind project, could give Bluewater Wind momentum going into Tuesday's decisive meeting in Dover. And it could give a basis for the Public Service Commission to spread out the costs. The PSC will join three other state agencies to decide whether to direct Delmarva to sign a 25-year deal with Bluewater in an effort to stabilize prices and curb emissions. ...Onshore wind farms offer prices 24 percent to 36 percent lower than Bluewater's project, he said. Delmarva contends the savings would be about 45 percent. But he included a pointed caveat: As onshore wind developers build, they will use up the good sites. Developers will eventually focus on less windy sites, resulting in higher costs. When that happens, there will be a move to build offshore, he said.
Delmarva Power recently discussed in the media an estimated figure of more than $20 billion in relation to the cost of a proposed offshore wind farm and backup power generation facility in Delaware (The News Journal Sunday Perspective, Nov. 18). ...Correctly stated, this figure represents the potential total cost of power supply for all Delmarva Power standard offer service in Delaware for 25 years -- rather than the total cost to customers for just the wind farm and a backup provider.
Delmarva Power officials, saying a proposed 450-megawatt wind farm could cost utility customers more than $20 a month, forwarded an independent analysis of the project to the Delaware Public Service Commission. ...Delmarva Power commissioned Pace Global to conduct the study because, "when you're asking to spend more than $20 billion of our customers' money on one project, we believe it merits a second opinion," said utility President Gary Stockbridge.
Pace Global Energy Services, LLC (“Pace”) was commissioned by Delmarva Power and Light (“Delmarva”) to independently assess the economic impacts of the proposed Bluewater Wind off-shore wind farm (the “BWW Project”) on Delmarva’s Standard Offer Service (“SOS”) customers. The review undertaken by Pace was based solely on publicly-available information and data sources. The report can be downloaded by clicking on the below link.
"There are a number of us who are concerned about how to put this thing in the proper context, as opposed to just plowing forward with one proposal from one company to do one thing," Keifer said. Too few groups are asking questions about Bluewater's plans, and too many are accepting the company's predictions on faith, he said. "There's a place for wind power, but it's not a question of religion,"...
NRG Energy and Conectiv Energy traded accusations that the other's proposal to back up a wind farm is impractical. The companies are vying to build a natural gas plant to back up Bluewater Wind's proposed offshore wind farm when the wind isn't blowing as hard. The two plants would provide electrical power on a long-term basis to Delmarva Power.
Some lawmakers remain concerned about the price of offshore wind energy, which has not yet been used in this country. Copeland said he was concerned the deal would lock ratepayers into higher bills than if electricity suppliers competed on a regular basis to fill Delmarva's required renewable-energy purchases. He said the public should be able to have its voice heard through their elected representatives. "We ought to let private investors compete against one another to get us the best price point and price stability. I think the marketplace would do that better than some regulatory regime," Copeland said. He said he wants to make sure low-income residents can afford wind power.
Bluewater Wind will build 150 energy-producing turbines off the coast of Rehoboth Beach by about 2014 at an estimated cost of $1.6 billion, according to a statement released this afternoon by Bluewater. ...Bluewater spokesman Jim Lanard put it more bluntly: "Our biggest concern is that Delmarva has a secret black box they may use to try to blow up the process." Delmarva would pay 10.59 cents per kilowatt hour for the wind energy, McGonigle wrote. That's 1.05 cents higher than Bluewater's original bid.
Friday is the deadline for Delmarva Power to release details of agreements with three power companies to provide stable-priced electricity for the next 25 years. Homeowners, environmentalists and state officials are awaiting data to see if the wind farm will offer a competitive price, as well as whether the wind farm will be big enough to make a sizable contribution to the state's electricity supply. ...
... Delmarva, unhappy it is being forced to buy power in the first place, hopes to minimize the amount of energy its buys on a long-term basis. The power company is concerned about the cost of wind power and has long contended it wants to protect its customers from having to pay for excess energy. In May, the Public Service Commission and three other state agencies ordered Delmarva to negotiate with Bluewater Wind for a 200-300 megawatt offshore wind farm.
Delmarva Power filed a lawsuit Wednesday challenging the Delaware Public Service Commission's order that the company negotiate to buy power from a proposed offshore wind farm and a natural gas plant. The lawsuit, filed in Sussex County Superior Court, comes eight years after the state embraced deregulation, which has led to soaring electricity bills and engendered resentment from ratepayers and lawmakers.
Cooper, who said he has only been keeping up with the wind farm proposal through the news, said his concerns lay with the farm's aesthetics. "I think a pristine skyline would be better than one with windmills in it," Cooper said. He did say he understands the wind farm would be far enough off the coast so as it would not be clearly visible. Bluewater Wind had completed a photo realization tour down the coast, where they exhibited rendered photographs of actual, local beach views of the ocean -- with the windmills digitally rendered on the horizon. Based on those photo realizations, the wind farm would be barely visible on clear days, and completely out of sight on hazy ones.
An energy plan that would draw electricity from a natural gas-powered plant and an offshore wind farm in Sussex County could be a net loss for consumers, critics said Thursday. The proposal, issued by the Public Service Commission on Wednesday, would bring the nation's first offshore wind farm to the coast of Delaware. But it also calls for construction of a 177-megawatt natural gas turbine in Sussex County at a site east of Bridgeville to help balance erratic transmissions from the wind farm. And that, said Sen. Harris B. McDowell III, D-Wilmington North, is a costly combination.