Library filed under General from Delaware
Recent articles about UD's wind turbine outage omit important essential facts and implications related to credibility, public safety, and liability.
The 2008 power purchase agreement, was considered an essential ingredient in building a wind farm off the coast of Delaware. Tuesday was the final day under the contract for Bluewater to exercise an escape clause without forfeiting a $4 million security deposit.
A two-week scramble ended without a buyer for Bluewater Wind, and as promised, NRG Energy terminated its landmark offshore wind power contract with Delmarva Power.
A two-week scramble ended without a buyer for Bluewater Wind, and as promised, NRG Energy terminated its landmark offshore wind power contract with Delmarva Power on Tuesday.
NRG reported two weeks ago its intention to terminate the contract if a buyer does not come forward because of problems gaining financing for the project, with long-term government subsidies uncertain. NRG originally reported the deadline was Dec. 23, but last week NRG spokesman David Gaier said Delmarva clarified that the deadline for giving notice of termination was Dec. 27.
When the public rallied behind the Bluewater Wind offshore project four years ago, the drama played out against a backdrop of economic prosperity, high -- and rising -- electricity prices, and no reason to doubt a federal commitment to the price subsidies underpinning the pioneering idea. But today, with almost all of that changed, Bluewater's owner, NRG Energy, faced the new normal.
Bluewater President Peter Mandelstam said on Monday he holds out hope that a buyer for the offshore wind division would step forward before Dec. 23, the date by which NRG must inform Delmarva if it wishes to end the contract.
New Jersey-based NRG Energy, however, said in a statement Monday that the outlook for offshore wind has changed dramatically over the last two years. The company cited two decisions by Congress that could significantly affect financing for any offshore wind project. Not one has yet been built in the United States.
A group representing Delaware's municipal electric utilities has signed a long-term deal for land-based wind energy. Patrick McCullar, the group's president and CEO, said the deal will buffer the utilities against what he called the increasingly unlikely chances the Bluewater Wind project will be built anytime soon.
By June 23 the developer needed to pay Delmarva $4 million or walk away from the contract. Delmarva granted Bluewater a three-month extension this summer, giving the firm until next week to pay $2.75 million and January 2013 to pay $1.25 million. Under the extension agreed to this week, Bluewater will have until Dec. 31 to pay the entire $4 million.
Delmarva spokeswoman Bridget Shelton said the utility has discussed the upcoming deadline with NRG, but "details of these discussions are confidential." Bluewater is working with a three-month extension, granted by Delmarva from its June 23 deadline to pay all $4 million.
But the firm has already forfeited $2 million of the deposit to delay the completion date. It now has until Sept. 23 to exit the deal, or lose $2.75 million, and until Jan. 1, 2013, to leave before it loses the rest. Bluewater will work to not only restore federal loan guarantee money, but to try to locate some private financing, Mandelstam said.
NRG Bluewater Wind says it will not install a planned meteorological tower for research this year, raising concerns about the future of a project that produced the nation's first offshore-windpower purchase agreement. State officials say they are disappointed in the announcement, but they remain committed to developing offshore wind power in Delaware.
The delay results from Congress' decision last month to eliminate most new funding for two loan guarantee programs used to finance renewable energy projects. That move was part of a compromise that averted a government shutdown.
NRG Bluewater Wind has won the exclusive right to negotiate with the federal government to build an offshore wind farm off Delaware, federal officials announced Thursday. The decision is the first formal step along a gamut of environmental and permitting reviews.
NRG Bluewater Wind is aggressively looking to expand its reach. Analysts say the company's bid last week to construct turbines off the Maryland coast is indicative of its thirst to build anywhere it can. NRG, which has a contract to supply Delmarva Power customers with electricity from a wind farm 13.2 miles off the Delaware coast, bid on 33 ocean tracts off Maryland under the name Bluewater Wind Maryland LLC.
Under Delmarva Power's rate-case proposal, the costs would be spread out over 10 years and would be added to the distribution side of the customer's bill. It is unclear how much each customer would have to pay if Delmarva Power receives its full request.
The University of Delaware is moving forward with plans to develop a field to test wind turbines in shallow water off the Delaware coast. ...State environmental officials said they haven't heard back from university representatives on the proposal since they met in February. State permits would likely be required before any project could proceed.
The federal government declined to fund an offshore wind farm assembly project at the Port of Wilmington, dealing a setback to the state's efforts to build a manufacturing base around the new technology.
The City Council voted unanimously to extend the moratorium's expiration date from Oct. 18 to March 2011. Mayor Jim Ford said the six-month extension was designed to give the city time to hold a public hearing on the matter and carefully craft the language of a new zoning ordinance for small wind energy systems.