The state Supreme Court announced Friday it will allow Toray Plastics and Polytop Corp. to appeal the Block Island wind farm power purchase agreement. At the same time the court ruled that the Conservation Law Foundation did not have standing to pursue its appeal of the same matter.
Two justices, Francis Flaherty and William Robinson, dissented from the latter finding and held that CLF should be allowed to appeal.
Oral arguments are scheduled for May 11 in Providence.
The two industrial concerns have argued that the contract reached between Deepwater Wind and National Grid is not “commercially reasonable,” one of the conditions laid out in the enabling legislation.
The approved contract for the Block Island wind farm calls for National Grid to pay Deepwater no more than 24.4 cents per-kilowatt-hour in the first year of a 20-year contract, with 3.5-percent escalations annually.
Toray and Polytop say this could lead to Rhode Island ratepayers expending $400 million in above-market rates during the life of the contract.
Both companies say that they themselves would be forced to pay millions more for electricity, and that the wind farm would hurt the state’s economy.
Furthermore, they argue that in the first power contract, which the PUC unanimously denied as being too expensive, Deepwater said the project would cost $219 million to build. During the PUC hearings on the second proposed contract – which followed the General Assembly’s creation of a law forcing consideration of a modified contract – Deepwater said the project would cost $205 million.
Toray and Polytop have argued that, since the approved contract calls for any construction savings to be passed on to the ratepayers, then Deepwater should immediately drop its opening electricity price because construction costs dropped $14 million between contracts.
The companies were originally joined in their appeals by CLF and former Attorney General Patrick Lynch. Lynch’s successor, Peter Kilmartin, dropped the suit once he assumed office. The Supreme Court then called upon the remaining parties to argue their standing before going forward on the appeal. Those arguments took place a few weeks ago.
The CLF, though a proponent of renewable energy and wind power, argued that the General Assembly overstepped its legal authority when it created a law to force the PUC to revisit the matter after it first rejected the contract.
In denying CLF standing, the court wrote: “Although we leave for another day the question of whether constitutional issues may be raised by a party with standing in the context of a PUC appeal… it is clear to us that CLF’s interest in this matter is to ameliorate the adverse affect of climate change by creating ‘the foundation necessary to build a strong renewable energy sector in Rhode Island.’ Such concerns implicate questions of policy more appropriately addressed in the political arena.”
Justice Flaherty, in his dissent, wrote that he and Justice Robinson thought the wind farm matter qualified as a “rare occasion” where it would be appropriate to allow a party such as CLF standing because of the “substantial public interest.”
In the wake of the decision, CLF issued the following statement from staff attorney Jerry Elmer:
“Conservation Law Foundation continues to support development of renewable energy in Rhode Island, as it always has done. However, building a robust renewable energy industry requires fair laws that create a level playing field for all developers and technologies. Today’s ruling may mean that the Deepwater Wind project goes forward, but the process by which it was approved is deeply flawed. 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.”
Elmer continued, “It is worth noting that two Justices dissented from today’s ruling, saying that they believe that the public policy issues that CLF is raising are exactly the sort of issues that the Court should address. We regret that today’s decision means that the full Supreme Court will never get to hear those important underlying issues.”
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