With a proposed contract for off-shore wind through BlueWater Wind tabled pending more state senate hearings, officials with Delmarva Power and Light (DPL) on Tuesday announced that they will take advantage of the time to explore other options for renewable energy – particularly, on-shore wind energy.
DPL President Gary Stockbridge announced Jan. 22 that the company would begin “reaching out to developers” that day, “asking for a range of options for renewable energy” for a bid period ranging from five to 25 years – that outside date being the term for the proposed contract with BlueWater Wind.
“To date, the only option that has been explored has been the off-shore proposal,” Stockbridge said. He referenced a state staff report that indicated the off-shore option would come would a 45 to 55 percent cost premium when compared to on-shore wind-power options.
“Having those options in hand is important before we decide what’s best for our customers,” he said. “It’s our duty to provide the lowest costs for our customers.”
Stockbridge said DPL would aim to find alternatives that would offer the same environmental benefits as off-shore wind with less risk, and to bring those options to the table as the goals for renewable energy in the state continue to be evaluated under legislation passed in 2006 and 2007.
Providers would have to meet state standards of being within or able to deliver to the established delivery region of PJM, the area’s regional controller for wholesale electricity, serving Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.
The timetable for those alternatives to be mapped out by DPL is less than six weeks away, on March 1, at which point Stockbridge said he expects to have bids returned to the company. The company would then set to evaluating the bids, aiming to have a breakdown of the information by mid-March and ideally in time to provide that information before or during the planned senate hearings.
Addressing the abbreviated timeline, Stockbridge on Tuesday pointed to the existing track record for companies providing on-shore wind energy, saying, “This is a much easier process because this is an established technology. They’re out there providing power as we speak. They’ve had contracts. There is more of a template.” He said DPL’s effort to obtain bids comparable to the BlueWater Wind deal would therefore be “easier, more simple to do.”
On DPL’s end, Stockbridge said the company would be able to provide quick action as well. “After the last few years, we’re familiar with it. We know how bids should be set up, how to work with suppliers. We know how to put it in our portfolio and compare it to the existing deal,” he said.
Stockbridge said the hope for DPL would be to obtain a “range of bids” covering the same amount of power that would be provided by BlueWater Wind’s proposed wind farm 11 miles off the shore of Rehoboth Beach, but covering periods ranging from five to 25 years so as to address concerns that the 25-year period of the BlueWater Wind bid is too long.
“Some people are concerned that 25 years is getting a bit long already,” he said. “Renewable energy is fairly new. There could be new innovation. Locking in for 25 years could be a bad thing, since it could lock us into existing technology.”
Stockbridge said DPL might look to combine deals with a variety of small providers to make up the same amount of renewable energy to be provided by BlueWater Wind – or more. He was also careful to specify that DPL will be looking for a contract for renewable energy itself and not just credits for purchasing renewable energy from sources elsewhere, though credits might also part of a deal.
He said DPL also hopes the same people who did the analysis of BlueWater Wind’s proposal will get involved with analysis of bids submitted in the new process with on-shore sources. That, he said, should address any concerns the public might have about how fairly the bids will be analyzed against the off-shore wind-power proposal.
Stockbridge said public and governmental involvement in the DPL renewable energy debate thus far made it essentially impossible for the company to move forward unilaterally on a deal with any of the on-shore wind-power providers that might make a bid. Instead, he said, DPL favors a continuation of the public and governmental input on any new bids, with hopes to be able sign a contract with a supplier once all the bids are considered.
“We would like the merits of this bid to convince people it’s the right thing to do and move ahead with the legislature toward meeting these needs,” he said. “We would like to get to a process where it gets compared to the other alternative, where it is done fairly with all involved. If (a bid is) that compelling, it should be an easy thing to do.”
“We hope move with the approval of all involved to do what we believe is the right thing for the state,” Stockbridge concluded.
Information on the bids will be kept as open to the public as possible, Stockbridge promised.
By M. Patricia Titus
22 January 2008
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