Until recently, with the exception of objections from a group of tenacious Narragansett residents and some Block Island residents, the offshore Deepwater Wind project has floated under the radar of public scrutiny. However, state Sen. Dawson Hodgson, (R-Dist. 35) of East Greenwich, North Kingstown, South Kingstown and Narragansett, in the announcement of his candidacy for attorney general, has now shined the light on this project that has significant similarities to the 38 Studios fiasco (“Hodgson will run for attorney general,” South County Independent, Jan. 16, 2014). Both projects seem to have originated in the office of the governor and given special treatment in the backrooms of the state legislature with high hopes of fame for their initiators and little critical review of their impact on Rhode Island taxpayers and utility ratepayers.
The tenacious residents of Narragansett who have steadfastly opposed this project are not against clean and green energy, but against the back room politics practiced by our elected officials who cleared the way for this project, which is a great financial deal for the developer and its hedge fund financier, and a bad financial deal for Rhode Island ratepayers both residential and commercial.
The R.I. Public Utilities Commission, upon reviewing the initial proposal for the project, denied approval for the project to proceed based upon its finding that the project was not economically viable. However, soon after the Public Utilities Commission decision, Rhode Island political shenanigans kicked in, and the state legislature in effect changed the rules for evaluating the project. Approval was given for the project to proceed with the signing of a power purchase agreement that would allow the developer to charge four times the wholesale rate existing at the time of execution of the agreement for power to be generated by the project with an escalation clause – COLA anyone? – of 3.5 percent annually for the next 20 years of power production. Recently, developers of alternative clean energy projects such as hydro, on-shore wind and solar have presented proposals with wholesale power costs running in the order of 50 to 60 percent cheaper than the Deepwater Wind project.
Hopefully, Sen. Hodgson’s welcomed focus on the Deepwater Wind project will cause other candidates for state office in the upcoming campaign season, particularly the gubernatorial candidates, to cast a critical eye on the financial details of this project and answer the question: Is the Deepwater Wind project another potential 38 Studios boondoggle and, if so, what remedial action can be taken before it’s too late?
Gerald M. McCarthy
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