Offshore Wind Wire

By William Morgan

The leaders of the Rhode Island House and Senate wrote to the state Public Utilities Commission Wednesday to support an offshore wind pricing agreement between Deepwater Wind and National Grid.

One day earlier, however, the director of the Energy Council of Rhode Island sharply criticized the deal and said it would harm large energy users.

Late last year, National Grid agreed to pay 24.4 cents per kilowatt-hour in 2013 for power from a proposed eight-turbine wind farm near Block Island.  That price could be even higher after the undersea transmission cable from Block Island to the mainland is factored into the deal.  The agreement is scheduled to increase 3.5 percent each year.  The Public Utilities Commission must approve the arrangement and has been receiving testimony for several months.

National Grid signed on to the power purchase agreement, in part, because of state legislation that pushed utilities to buy power from large scale renewable energy producers.

In passing that legislation “the General Assembly understood that renewable energy sources are today more expensive than fossil fuels,” wrote House Speaker Gordon Fox and Senate President Teresa Paiva-Weed.  “The General Assembly also recognized that the development of renewable energy sources provides other benefits to our state and nation.”

The letter cited carbon-free energy production, energy independence and economic development as other benefits, and said that the Block Island project made progress toward those goals.

While the politicians were lobbying for the agreement, Energy Council of Rhode Island Executive Director John Farley was campaigning for the commission to reject the deal.

On Tuesday, Farley submitted a letter saying that the “price is so high that it more than negates any other potential attractive features (such as job creation, added local supply and environmental protection).”

The Energy Council includes several large companies and institutions in the state.  Farley said that some of them could see their electric bills rise as much as $400,000 annually.  He projected that employers would be forced to cut jobs to pay the increased electric bill, outweighing the potential job creation.

“The fact is, we cannot understand why this contract is even before the Commission today,” Farley wrote.