Deepwater deal faces federal complaint
Posted in the Rhode Island Forum
#1 Sep 1, 2012
Newport Rhode Island
Deepwater deal faces federal complaint
By Stephanie Turaj | Aug 31, 2012
"A Newport resident filed a complaint with a federal agency last week charging that electricity generated at a wind farm off Block Island’s southern coast would be too expensive, a burden that would unfairly fall on mainland ratepayers.
The agreement that would allow Deepwater Wind to sell its power to National Grid also violates federal laws by giving one company exclusive rights to develop wind farms in state waters, says the complaint by Ben Riggs.
“The result is a project that will charge rates that are nearly double that of Cape Wind, and will double again over 20 years,” said Riggs.
Jeff Grybowski, Chief Administrative Officer of Deepwater Wind, called Riggs’ complaint frivolous.“He has long been a project opponent,” Grybowski said.“Based on his complaint, he seems to oppose any energy source that does not pollute our air by burning fossil fuels. We are very confident that the Federal Energy Regulatory Commission will reject his complaint. In fact, it appears that he filed at least one previous complaint with FERC on an unrelated energy issue that was rejected. We are moving full steam ahead on both our wind farm and transmission projects for Block Island.”
The $204 million, five-turbine Deepwater Wind project would generate up to 30 megawatts, more than Block Island could use. Excess power is to be sold to National Grid and transferred to the mainland on a 15-mile cable that will be laid under the ocean floor. It’s the first of two projects the company plans in the region; the second, much larger project would lie further offshore in federal waters.
The Block Island project just passed a federal regulatory hurdle for its cable and is about to start the state permitting process. It’s the first offshore wind project planned in Rhode Island and a contender to be the first in the country if construction starts next year, as the company has said it plans.
The project would reduce Block Island energy costs, which are currently almost eight times those in the rest of Rhode Island. But at a starting price of 24.4 cents per kilowatt hour and annual increases of 3.5 percent, its power would start off almost three times more expensive than the conventional sources where National Grid buys most of its power. The net effect would be a roughly 2 percent increase for mainland ratepayers as soon as the wind farm goes online, with more increases to follow.
“In the case of Block Island, it would certainly be nice to be able to improve the cost and reliability of electric power there,” writes Riggs in a comment letter, but he adds,“more than 99% of the cost would unfairly fall on non-Block Islanders. For those of us who don’t enjoy having a home there, this is objectionable.”
Another wind project could have cost less, claims Riggs in the complaint, which was filed August 22 with the Federal Energy Regulatory Commission and targets the state Public Utilities Commission decision that allowed the deal between Deepwater and National Grid to be struck. Cape Wind’s much larger offshore wind project off the coast of Cape Cod was contracted for a starting rate of 18.7 cents per kWh.
The power agreement violates the Commerce Clause of the U.S. Constitution and two federal laws, the Federal Power Act and the Public Utility Regulatory Power Act, says Riggs. He also charges that, by giving Deepwater exclusive rights to develop offshore wind farms in state waters, the agreement limits interstate trade by nixing out-of-state competitors for the 20 year life of the agreement."
#2 Sep 1, 2012
Ben Riggs was one of the first people to speak against the Portsmouth High School wind turbine. The high school wind turbine sits there today three years old with a broken gear box. The gear box ,shaft and front bearings are gone .The cost of repairs is more than the cost of the turbine.
Under the current Rhode Island and Massachusetts Grid operators rules, the traditional power companies gas, coal, oil have to bid on power the day before they get paid; for example, 6 cents per kilowatt hour.
Under the current rules, the commercial wind turbine companies automatically get paid the day they produce the power for example, 18 cents per kWh because they can only produce power when the wind blows. The Grid operator has to take the renewable energy wind product first that day.
The traditional power company is glad to stand down when the commercial wind turbine company is producing power.
What the public needs to understand is that in Rhode Island or Massachusetts, when the commercial wind company is getting paid the 18 cents, the traditional company that bid the previous day stands down and gets paid anyway.
Thus the cost to electric rate payers is the 18 cents plus the 6 cents the traditional company bid the previous day. The cost per kilowatt hour could cost up to four times normal bid costs.
Rhode Island needs to review the electric bid process and how it affects residential and business customers..
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