Library filed under Offshore Wind from Virginia
The commission in charge of regulating Dominion’s proposal finds the project to be overly expensive, risky and unnecessary, but it says it is unwilling to send it back to the utility company because state legislators believe such a project, in principle, would benefit the commonwealth. That’s a shame. The commission’s research highlights significant concerns with Dominion’s proposal. Yet, the project moves ahead.
Finally, the commission complained that ratepayers will bear the financial brunt of a project that won’t, under any scenario in Dominion’s long-term energy plan, be competitive with other resources for the next 25 years.
The SCC concluded in a scathing 20-page order on Friday that the Coastal Virginia Offshore Wind project isn’t needed to serve Dominion customers and will cost more than any other option for generating electricity to serve the utility’s 2.6 million customers. The commission was especially direct in noting that the project’s developers won’t bear any of the risk for a project.
The Virginia State Corporation Commission issued this order approving Dominion's proposal to construct a 2-turbine, 12 megawatt wind energy facility 27-miles off the coast of Virginia. The project has a price tag of $300 million. The SCC made clear in its order that it had no choice but to approve the project given current state statutes. However, the approval, according to the SCC's order, was contrary to what it deemed prudent as that term has been applied by this Commission in its long history of public utility regulation. The SCC bowed to the legislative mandate by approving the project. A portion of the order is posted below. The full order can be accessed by clicking the links on this page.
In truth, it is hard to imagine a worse factual record, a worse example of wasting ratepayer money and imposing ratepayer risk. For $300 million or more the company will receive only 12 megawatts of power and with the assumed operational efficiency of the turbines that will work out to 78 cents per kilowatt hour. Then a hurricane may wreck it.
The $300 million project will be funded through existing base rates, enabled by the Grid Transformation & Security Act. Contingent on various regulatory approvals, onshore construction would start in 2019, followed by turbine installation and operation in 2020.
Offshore wind power has blown hot and cold in Virginia, but could get a boost Wednesday when the governor’s office expects to introduce the global consultant it’s chosen to help position the state as a major contender.
"The all-in number is $300 million, and that includes some of the money that has been spent to date by Dominion on research and development," said David Botkins, a Dominion spokesman. ...The deal calls for Dong to build two 6 MW wind turbines 27 miles offshore of Virginia Beach.
In the federal government, nobody has a bigger-picture view of offshore wind energy’s potential than Abigail Ross Hopper.
Dominion has proposed building two 6-megawatt turbines about 27 miles off the Virginia Beach coast, and recently has been evaluating a second set of bids for the project that would put its total cost between $300 million and $380 million. The first bid round yielded an estimate of $375 million to $400 million. Dominion’s initial projection was $230 million.
A second round of bids to build two wind turbines off the Virginia Beach coast appears to have lowered the price, but Dominion Virginia Power officials haven’t decided yet whether to green-light the demonstration project. “We are optimistic, but it is a fairly hefty cost to deploy these turbines,” Mark Mitchell, a Dominion vice president, said in an interview Wednesday.
Dominion’s decision follows a series of meetings with manufacturers, shipbuilders and engineers, including one Friday in Richmond aimed at finding ways to make installing wind turbines at sea more affordable.
Dominion is putting the brakes on a plan to erect two test wind turbines off the coast of Virginia Beach because the project, as it stands now, is too expensive, according to the company. Dominion had estimated that building the two 500-foot turbines would cost about $230 million, but the only complete bid for the work came back at between $375 million and $400 million, said David Botkins, a company spokesman.
Virginia offshore wind development efforts are running into concerns about protecting endangered whales. The North Atlantic right whale is one of the most endangered whale species on the planet, the Virginia Conservation Network’s Chelsea Harnish told the Virginia Offshore Wind Development Authority Wednesday.
The earliest Virginia offshore commercial wind development could occur would likely be 2022, or even five years later than that, energy officials said Thursday. Getting the required permits to build an offshore wind farm could take seven years alone.