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Utilities group signs deal for wind power; Land-based project is seen as hedge against Bluewater

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.

The Delaware Municipal Electric Corp. (DEMEC) signed a deal with Duke Energy Renewables for the entire output of a 69-megawatt wind facility in Lycoming County, Pa., in the north-central part of that state.

DEMEC will buy all of the energy and renewable energy credits from the 30-turbine project for 25 years. It is expected to come online in late 2012, just before DEMEC is required by the state to buy renewable energy.

DEMEC was the first organization to sign a contract with Bluewater Wind, the offshore wind developer. Its small contract for offshore wind power came before Delmarva Power’s landmark 200-megawatt contract in 2008.

But with increasing federal uncertainty about offshore wind subsidies, DEMEC has looked to broaden its portfolio, said McCullar.

“We have made the strategic decision we don’t see that moving forward in the foreseeable future,” McCullar said. “We’ve taken that out of our planning process.”

There’s plenty of room in its portfolio for both if the Bluewater project goes forward, which it could later on, he said.

McCullar declined to discuss the contract price for the onshore project, out of respect for Duke’s competitive situation.

“We view it as being competitive with prices of energy off the grid,” he said.

The municipal utilities also have a contract with the Dover SunPark solar project.

McCullar also noted the utilities will be taking 70 megawatts from a combined-cycle natural gas plant in Ohio, which he said would help drive down energy prices.