Breaking: Delmarva Power, The Delaware Electric Cooperative and Old Dominion Electric Cooperative Unite To Buy Wind
March 25th, 2008 by Maria EvansNews Release from DP & L, The Delaware Electric Cooperative and Old Dominion Electric Cooperative:
The Delaware Electric Cooperative and Old Dominion Electric Cooperative havejoined Delmarva Power’s competitive bidding process to acquire land-based wind energy to supply their customers, the companies announced today.   Â
The utilities made the announcement after Delmarva Power received more than 35 price bids from land-based wind developers from across the region. Early indications from the bids are that buying land-based wind power through this competitive process could save customers an estimated 50 percent compared to Bluewater Wind’s current proposal to Delmarva Power for a 25-year contract. Final bids from wind providers are due at the end of March. The utilities will conduct a thorough analysis of the bids. The analysis will likely be complete by the end of April.
In addition to a lower price, most of the onshore bids have no built-in price escalators. The Bluewater Wind proposal, by comparison, automatically increases the price to customers by 2.5 percent each year, starting in January 2008.
Onshore wind energy provides consumers with the same environmental benefits as offshore wind energy but at significantly less cost, in part because of the many costs associated with building and maintaining power generation and transmission equipment in the ocean’s harsh and corrosive environment.
“We are pleased to join with the Delaware Electric Cooperative and the entire family of Old Dominion Electric Cooperatives in this groundbreaking process to bring clean, affordable renewable energy to the region up to five years ahead of any offshore proposal,†said Delmarva Power President Gary Stockbridge. “Together we can achieve considerable savings for our customers, establish a long-term source of renewable energy for both Delaware and the region, while doing what’s right to help protect the environment. The addition of the family of Old Dominion Cooperatives to Delmarva’s ongoing wind power bidding process should expand the growth of wind energy throughout the entire Delmarva Peninsula and the Commonwealth of Virginia. This is an exciting day for the development of renewable energy in the region,â€Â Stockbridge said.   Read it all HERE
A couple things off the top of my head:
- This doesn’t satisfy the HB 6 requirement of Delaware based energy generation.Â
- This brings no new jobs to the state, no new industry, no new educational opportunities. Â
- Can Gary Stockbridge explain how, “This is an exciting day for the development of renewable energy in the region,” when the only thing “the region” is doing is purchasing power from other states? Isn’t it an exciting day for renewable energy in other states?Â
- There’s only so much land based wind power available, and as other energy companies in other states start purchasing it, the price can only go up.Â
- I admire the Cooperatives for thinking ahead.  House Bill 6, which compelled DP&L to enter into a long term contract with a price sustainable Delaware based energy utility to avoid crushing their residential and small business customers again, did not apply to the Cooperatives.Â
It didn’t apply to the Cooperatives because the Coops were already buying long term contracts and not smacking down their customers with harsh rate increases.Or to put it in easy to understand terms: They were smart. Â
March 25th, 2008 at 4:32 pm
Quote: “This brings no new jobs to the state, no new industry, no new educational opportunities.”
I’m not sure the wind power project was meant to do that. It would be nice but we can’t throw it out because it doesn’t do those things. We have to make a serious effort at reducing pollution from the coal-fired power plants, and until a better technology comes along, this seems to be a good start.
I also think the land-based wind generators would be a more reasonable project; less costly to build and maintain. It would be interesting to see the cost difference between land-based and sea-based generators.
March 25th, 2008 at 4:52 pm
The Co-op was allowed to opt out of the 20% renewable energy requirement that DPL SOS customers face. It is good to see the Co-op move to some about of renewable energy other than landfill gas.
They give no details on the length of the contracts they seek or if it will be their standard offer or a customer option as it is today.
If the BWW project were spread statewide, it would only be like 7% of the power source and the rest of the nonsolar renewable energy requirements could could from these onshore sources. The only way to stabilize costs is with longer term contracts.
March 25th, 2008 at 5:00 pm
John the wind power that they’re talking about won’t be in Delaware, so all of the benefits would be for other states.
March 25th, 2008 at 11:50 pm
That’s correct. Buying renewable power from out of state does nothing for jobs in Delaware, reducing transmission congestion costs, new education opportunities, or meeting the in state power generation requirement of HB-6.
The Co-op has joined DPL’s bidding process. How they may include renewables in their power mix could be the same as today - A customer option, or part of thier power mix like the WGES offers. The WGES current offer works out to $4/month for 20% onshore wind energy, but just for 2 years. Not for 25 years.
All we know is if there is a cheap long term contract out there the Co-op wants in.
Folks use percentages when they want to make small numbers appear BIG. If the BWW PAA is 50% more expensive, then $6.46/1.5 = $4.31/month.
March 26th, 2008 at 2:22 am
[...] Maria got there first . [...]
March 26th, 2008 at 12:25 pm
Let’s characterize DP&L’s position for what it is: A hoax!
To add to and fortify the apt comments of Maria and J Austin, I recommend the detailed analysis of the entire joint statement by kavips, referenced above by Maria.
Representative John Kowalko, who has been on top of this windpower issue, makes a comment to the kavips analysis that concludes with the following statement:
“The only honest supposition is that costs will rise and rise dramatically. Delmarva and Stockbridge are being dishonest and disingenuous in their manipulation of facts and it may be time to hold hearings regarding their activities.
John Kowalko”
Are we going to allow Senators McDowell and Adams to submerge this opportunity for Delawareans for clean, stable priced energy for 25 years, for 500 jobs during construction, 80 after, and for a technology center at Del Tech?
If we do allow these hucksters to prevail, shame on us!!!
March 28th, 2008 at 8:03 am
1.Delaware is a right to work state. You do not have be in a union to work here. If they use all union employees, where are they going to come from?
2. Why build a wind farm in salt water. Do you realize the associated maintenance cost? Let alone the construction costs. Have you ever driven down route one very early in the morning? You will see DP&L washing of the salt water from the lines. Yes I said washing, the salt will shorten the lifespan of anything. Very high maintenance costs.
3. How long will the towers last in the Ocean? What will the replacement cost be?
4. If there is a wind farm in the ocean by us….are we first on the list to reap the rewards of the power or can the owners sell to Jersey. Who decides that?
5. 25 year contract is not long enough at all. I lived in a place that had a reduced energy cost and tax structure for 25 years because the town opted to let a power company build. It was great while it lasted. When the 25 years were up, electric bill went up and so did taxes. The taxes were so high no one could sell their home. The area was never the same.
6. Building anything in salt water and expecting it to last is a dream, that ultimately will turn into a nightmare.
March 29th, 2008 at 4:05 am
There are already unions lined up to do the work, in fact, one union head just wrote an op-ed piece calling for it’s construction.
They know the costs, and they know about salt water, other countries have off shore wind farms, BWWs affiliates have experience with it. They’ve been using off shore wind in Europe and the conditions here are actually more benign off shore. The BWW people are professionals, they “get” the conditions.
Delaware would get the benefits of the wind power first, any excess power generated over what they’ve contracted to DP&L and the municipal users (who’ve already agreed to buy power) they can sell on the open market.
As it stands now, DP&L is compelled by the General Legislature to sign a contract between 10 and 25 years.
March 29th, 2008 at 8:22 am
I thought BWW was an American Company?
http://uk.reuters.com/article/companyNews/idUKSYD29636020071001
Wind Farm: http://en.wikipedia.org/wiki/Wind_farm
http://upload.wikimedia.org/wikipedia/commons/2/2d/US_wind_power_map.png
March 29th, 2008 at 6:42 pm
post, WGMD covered the story of BWW being purchased by B&B, it actually made BWW more attractive to the PSC. B&B has a history of being on time and on budget. http://www.renewableenergyworld.com/rea/partner/story?id=51028
And the University of Delaware and Stanford did a study of the wind off the Delaware coast, they were so satisfied with the results the people who did the study are endorsing the project. http://www.udel.edu/PR/UDaily/2007/feb/wind020107.html
March 31st, 2008 at 6:18 am
What union is lined up? We have a whole county of people who would love to work!
“in fact, one union head just wrote an op-ed piece calling for it’s construction.”
I’m sure he did, he needs the work…but what union was it? and How can locals apply? How about some contact numbers. Who told you unions are lined up? Just because a company is professional doesn’t mean they get anything……………………bear sterns…….enron….the list goes on,
Who paid for that study at Stanford and Delaware? Dig into that one.
It should be built on land. Simple.
April 2nd, 2008 at 3:06 pm
Blue Water Hot-Air could have built fifty windmills with the money they’ve spent advertising on GMD.
“Build windmills or die in a fireball; the choice is yours.”
April 2nd, 2008 at 6:05 pm
At least BWW is paying for their own advertising right now, DP&L is passing their advertising costs along to their customers.
April 3rd, 2008 at 4:20 am
Every business passes the cost to the customers.
April 3rd, 2008 at 5:07 am
posterone here’s the local ironworker union guy: http://www.delawareonline.com/apps/pbcs.dll/article?AID=/20080327/OPINION10/80326065/1004/OPINION
who supports the wind farm.
And yes, every business passes costs to customers, but right now, BWW is paying for their own fight, while DP&L has publicly said they are passing their lobbying fees and other costs of fighting the wind farm to their customers.
April 3rd, 2008 at 8:37 am
We’re all paying for Blue Water Hot-Air’s ads. Preferred ‘green’ business gets huge capital gains tax breaks at the investment level…..guess where the revenue deficiency has to come from? That’s right- the rest of us.
April 4th, 2008 at 9:10 am
I thought just the oil company’s made this kinda cash. No wonder they are footing the advertising costs. They’ll make it back ten fold in the end. This company will use all foreign vendors and materials for the actual towers. Their blowing wind alright, right at us. We need a company completely owned and operated by Americans to provide such a important resource for our needs.
Check out some financial reports:
http://www.babcockbrown.com/bnb-investor-information/results.aspx
http://stocks.us.reuters.com/stocks/overview.asp
April 4th, 2008 at 11:06 am
posterone, we already know who BWW is working with, it’s on their website. The Fluor Corporation headquartered in TX is doing the construction, http://www.fluor.com/ and, in fact, here’s the list of who BWW will be using in Delaware http://www.bluewaterwind.com/de_partners.htm.
And yes, B&B bought BWW during the process here in Delaware, that just made the company more attractive to the PSC. I think we’ve been over this before.
BWW is also going to make the Port of Wilmington a shipping hub for the east coast and work with Del Tech for educational opportunities.
Maybe if we didn’t let Europe get so far ahead of us in wind power technology, the USA would be able to supply BWW with everything they need.
April 4th, 2008 at 11:24 am
Europe is way ahead of us in nuclear power, too. France, especially…..80% nuclear-generated electricity. Windmills will never be able to come close to satisfying our ever-growing demand.
April 4th, 2008 at 2:43 pm
Rick, DP&L is freaked out about the cost of a $1.6 billion dollar wind farm, I can’t imagine they’ll be all for a $6 - $10 billion dollar nuke plant.
April 4th, 2008 at 8:32 pm
Yes they work (or did) in Seaford at the Dupont Plant.
“According to the company’s Web site, Fluor started as Fluor Construction Co. in 1912. It acquired Daniel International Corp. in 1977, and the company was known as Fluor Daniel until about 2002, Mershon said, after it spun off its coal business and several acquisitions. Fluor Daniel is now the environmental services arm of Fluor Corp”
April 6th, 2008 at 6:21 pm
posterone:
“It should be built on land. Simple.”
Both the U.S. Department of Energy and the University of Delaware conducted research that showed that winds at sea off the Delaware coast are significantly higher than winds on land:
http://www.eere.energy.gov/windandhydro/windpoweringamerica/images/windmaps/de_50m_800.jpg
There’s also few places on land, especially in tiny Delaware, to build such large wind farms. You’d have to buy up costly residential or farm land. The benefit of an offshore location is that there’s plenty of unused space, which is coincidentally quite windy.
April 7th, 2008 at 4:29 pm
Perhaps. Just seems so expensive, from an installation stand as well as maintenance.