The all-time-low price of electricity has put wind energy projects in the U.S. – including the Galloo Island Wind Farm proposed in the town of Hounsfield – on hold, according to Galloo’s developer.
“Electrical power prices are currently at an all-time low because of an oversupply of natural gas due to hydro-fracking. This has put wind energy projects on hold generally throughout the country, including the Galloo project,” said Thomas L. Hagner, president of Upstate New York Power Corp., in an email. “The entire U.S. wind energy industry is waiting to see when this turns around.”
In the email, addressed to Kevin J. Casutto, state Department of Public Service administrative law judge on the case, Mr. Hagner asks that the ruling on the schedule for the 252-megawatt project be “calendared” and revisited in another six to nine months.
The email was sent in advance of a teleconference scheduled for Friday to delay a decision on a 50.6-mile transmission line connecting Galloo Island to the Fitzpatrick-Edic Substation in town of Mexico, Oswego County.
Besides the low price of electricity, the company’s investors – who already have sunk more than $12 million into the project – are hesitant to move forward over concerns on whether the tax credit for renewable energy will be extended.
“While this tax credit has been extended many times, there is such divisive dissension in Washington it is unclear when Congress will act on this issue,” Mr. Hagner said.
However, these uncertainties in the energy industry could work in favor of the Galloo Island project in some ways.
Mr. Hagner said the “current downturn in the wind energy industry” may cause several other projects in the New York Independent System Operator interconnection queue to abandon their positions and “allow an interconnection for the Galloo project at existing Coffeen Street substation.”
Earlier this year, Upstate New York Power said that instead of running costly underwater transmission lines under Lake Ontario to Scriba, it would rather have the lines make landfall in Hounsfield and run to National Grid’s Coffeen Street substation in Watertown.
At that time, the company also floated the idea of selling power to Fort Drum.
“While the opponents of our renewable energy project would like to use any excuse to kill the project/transmission line, there is no legitimate reason not to wait to see how these items resolve themselves,” Mr. Hagner said.
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