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2 manufacturers get court go-ahead to challenge wind farm off Block Island

PROVIDENCE – The Rhode Island Supreme Court has ruled that two large manufacturers have legal standing to challenge a key approval for a wind farm proposed in waters off Block Island, but the court majority decided that a regional environmental group does not have standing and cannot continue in the case.

In a seven-page decision released Friday morning, the five court justices said that the appeal lodged by Toray Plastics and Polytop Corp. can progress to a full hearing, scheduled for May 11. The two companies, both heavy users of electricity, object to the high price of power in a contract between Deepwater Wind, the company developing the 5- to 8-turbine wind farm about three miles southeast of Block Island, and National Grid, the state’s dominant electric utility. Together, the plastics manufacturers appealed the state Public Utilities Commission’s approval of the power purchase agreement last August.

The Conservation Law Foundation also lodged an appeal, arguing that an amendment last year to state law that facilitated the agreement amounted to special-interest legislation designed to benefit only Deepwater. Although the full court dismissed the CLF’s petition, two justices – Francis X. Flaherty and William P. Robinson III – dissented.

The issue of legal standing in the case arose after the court in February granted a request from Attorney General Peter F. Kilmartin to drop out of the lawsuit. His predecessor in office, Patrick C. Lynch, filed the initial petition seeking to overturn the agreement, but Kilmartin supports the wind farm and, before winning election, said he would not pursue the case.

At a hearing April 6, Michael R. McElroy, lawyer for the plastics companies, and Jerry Elmer, staff attorney for the CLF, argued why they should be allowed to continue the case without the involvement of the attorney general’s office.

McElroy said his clients have standing because they will have to pay millions of dollars in additional electric distribution fees to National Grid because the above-market costs of the wind farm will be shared throughout the state power system. Elmer said that the CLF has standing because its members will be directly affected by climate change if the controversy surrounding the Deepwater project delays other renewable energy developments.

A lawyer for Deepwater and National Grid argued against their petitions as did an attorney representing the governor’s office and General Assembly leaders.

In its decision, the court referred to state law and past decisions it had made. In appeals of PUC rulings, state law confers standing only on parties “aggrieved by a decision or order of the commission.”

The court has ruled that “a person is so aggrieved by a judgment or order when such judgment or order results in injury in fact, economic or otherwise.” Conversely, “[m]ere ‘interest in a problem,’ no matter how longstanding the interest and no matter how qualified the organization is in evaluating the problem, is not sufficient by itself to render the organization ‘adversely affected’ or ‘aggrieved,’ ” the court has also decided.

In dismissing the CLF’s claim, the court majority “acknowledges [the organization’s] significant interest in issues of climate change and recognizes the strong public interest in this offshore wind project,” but said it did not meet the standards for standing.

“Such concerns implicate questions of policy more appropriately addressed in the political arena,” the court said.

In their dissent, Flaherty and Robinson wrote that the CLF should be granted standing “because we are of the firm opinion that this is one of those ‘rare occasions’ when it would be appropriate to ‘overlook’ the standing requirement to determine the merits of a case involving substantial public interest.”

In response to the court’s decision, Elmer said that developing renewable energy in Rhode Island requires fair laws that put companies on a level playing field.

“Today’s ruling may mean that the Deepwater Wind project goes forward, but the process by which it was approved is deeply flawed,” he said in a statement. “We fear that this could have a chilling effect on the future of the renewable energy industry in Rhode Island, which would be a net loss for our citizens, our economy and our environment.”

The court did not elaborate on why it conferred standing on Toray and Polytop, saying only that the two parties qualify as “aggrieved” within the requirements of state law.

McElroy said the case deserves to continue and referred to new estimates that National Grid submitted to the PUC this week of the above-market costs of power from the wind farm over the 20-year contract.

“We’re pleased with the court’s decision to review the merits of the PUC’s majority approval of the purchase power agreement, especially in light of the fact that National Grid has recently increased its estimate of the above-market costs of this project from $390 million to between $409 million and $415 million,” he said in an interview.

The estimates of the above-market costs increased because the cost of natural gas, which provides a third of New England’s power, has gone down because of increased supplies. The starting price in the Deepwater contract is 24.4 cents per kilowatt hour, more than three times the price that National Grid charges Rhode Island consumers through its standard offer rate.

Deepwater declined comment on the Supreme Court decision.