Commissioners order Delmarva Power to neogotiate with all three bidders
Wind-power advocates in Delaware received support from the state this week as a proposal to build an offshore wind farm off the coast of Bethany Beach or Rehoboth Beach began to seem more plausible.
Delaware’s Public Service commission voted Tuesday, directing Delmarva Power to negotiate with all three bidders in a process to secure new energy generation for the state but called a wind farm offshore the best option.
In a unanimous 5-0 vote, the commissioners directed the power company, whose rate spikes last year prompted this process, to negotiate with Bluewater Wind as a power provider, and with NRG and Conectiv to secure sources of backup power to supplement the proposed wind farm.
Commissioners, in their decision, gave all parties flexibility in the size and types of generation plants. Conectiv has proposed building a natural gas plant, with NRG proposing a “clean coal” plant at Indian River.
The other three state agencies involved in the process punted on a decision Tuesday but vowed to have a decision in the next couple weeks. Those agencies must approve any option if the state would direct Delmarva Power to negotiate.
“We are pleased with the outcome and look forward to beginning negotiations,” Jim Lanard, Bluewater Wind spokesman, said after Tuesday’s decision. “We are highly confident that an agreement can be reached that will provide clean, renewable, stable-priced electricity to Delmarva Power customers.”
Perhaps the biggest story of the long day in Dover was NRG’s ability to secure a spot at the negotiating table. Public Service Commission staff on May 2 recommended a hybrid approach that would see a smaller wind farm and Conectiv’s gas plant built downstate.
They had left NRG, owner of the Indian River Power Plant, entirely out of the process. NRG joined Conectiv officials in announcing Tuesday that they would be willing to build generation to serve in a backup capacity to Bluewater Wind’s wind farm.
NRG’s announcement seemed particularly surprising to officials in attendance Tuesday and may have secured their spot at the table.
“Obviously, we’re very pleased,” said Caroline Angoorly, NRG regional vice president. “I think it’s the right thing. It’s about getting the best deal. Competition always gets the best deal.”
NRG backup generation at Indian River could come in the form of a natural gas plant, similar to one proposed by Conectiv upstate. It is yet unclear whether NRG could or would be willing to build at Indian River a smaller coal gasification plant that would come with reduced emissions.
Conectiv officials said after Tuesday’s meeting that they are willing to serve in a backup capacity but would not comment directly on specifics including the viability of building their natural gas plant in Sussex.
“We’re going to see what the state agencies have to say,” said Bill Yingling, company spokesman. “We’re open to discussing various options.”
Delmarva Power remained adamantly opposed to the three bids throughout, and after Tuesday’s meeting, calling them too costly for their customers in Delaware and across the region. But they did not initially object to the commission’s orders to negotiate.
“We are going to discuss it internally and see how we proceed,” said Tom Shaw, Delmarva Power chief executive officer. “The bids gave us a great deal of concern because of size and cost. It is still a concern. We’ll have to see how it plays out.”