2) The potential of procuring offshore wind is already in Delaware's Climate Action Plan, as covered in HB 99.
3) All 18 existing projects went through utility commission procurement, so DNREC is the wrong state agency to be considering Power Purchase Agreements.
4) A working group established by the Governor recommended not buying offshore wind because it costs too much and further recommended the state include other zero-emission generation sources in any future competitive bidding process, such as onshore wind and solar.
5) There is no true competitive bidding process for offshore wind as a bidder must have a federally approved lease area, and only two such leases exist near Delaware.
6) Offshore wind costs have risen, with many state-approved projects now seeking revised, higher-priced state agreements.
7) Existing offshore wind leases are facing legal challenges over serious environmental impacts on endangered species, commercial fishing, navigation, tourism, and property values.
8) The bill has a long list of potential cost-offsetting benefits, but no list of costs to be considered. Besides the large premium price to electric consumers, that cost means money won't be spent elsewhere in the economy potentially killing 3,000 permanent jobs compared to several hundred temporary jobs and 25-50 permanent jobs created by offshore wind. The Maryland project developers have left open ocean leased areas closest to shore that would be the most likely spots used for a Delaware project which could reduce tourism and property values. There could also be lost commercial fishing revenue.
9) CO2 savings based on PJM data3 may only be a little over 1 million tons annually, only 3% of the premium power cost, and possibly less because inefficient peaker power plants would need to run when the wind stops, and emissions would be produced during manufacturing and installation of the turbines.
10) Offshore wind produces unreliable power, and Chart 1.0 below is based on six years of operating data from the Block Island offshore wind project, showing how most power is produced in the spring and fall when electric demand is lowest and the least power in the summer when demand is highest.
SB 170 is unnecessary, as potential future offshore wind power procurement will already be considered in future Delaware Climate Action Plans as covered in HB 99. We can only hope that Delaware will not adopt offshore wind procurement considering its ridiculously high cost compared to other clean energy options.
- The announced Skipjack 2 first-year price was adjusted over the twenty-year contract period for a built-in price escalator to calculate the average $146.42/MWh price. Solar and onshore wind projects have no such escalators. The 800 MW facility will operate 44% of the time, according to the developer, or 3,854 hours a year, to produce 3,085,000 MWhs/year for an annual OREC cost of $452 million a year. Total electric demand in Delaware is avaregaing11,480,000 MWhs/year, so the added cost per MWh to customers is $39.35. The average Delaware residential customer uses 11.2 MWh/year, so the added cost per year is $440.
- A just released analysis by the US Energy Information Agency, "US energy insecure households were billed more for energy than other households," https://www.eia.gov/todayinenergy/detail.php?id=56640 , shows the lowest income electric customers pay 30% more than everyone else as they live in efficient homes, so they might pay $560/month.
- PJM Systems Mix, https://gats.pjm-eis.com/gats2/PublicReports/PJMSystemMix. The CO2 savings from the expected annual generation is only 1,080,000 metric tons per year as wind generation would simply offset the PJM regional grid systems mix, which is currently only averaging 0.35 metric tons/MWh. The current cost of Regional Greenhouse Gas Initiative (RGGI) carbon allowances is only about $13/ton, so the savings are only worth about $14 million, 3% of the annual electric premium. Some of those savings would be offset by the need to run inefficient peaker plants when the wind isn't blowing.