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According to an evaluation on new power sources for Delaware, all three power proposals are nonconforming and none should be given a long-term contract with the state.
The evaluation was completed by Delmarva Power and an independent consultant and submitted to the state Public Service Commission (PSC) Wednesday, Feb. 21. The evaluation details why all three bids do not meet the standards of the legislation set forward for new power and are not needed in Delaware.
“Delmarva urges the state agencies not to approve any of the bids,” reads the evaluation. “In sum, therefore, while Conectiv is the highest ranking bidder, neither its bid, nor the other lower-ranked bids achieve the act’s goal of energy price stability in a cost-effective manner, while providing environmental and other benefits to the state of Delaware.”
Conectiv received the highest score, followed by Bluewater Wind and then NRG. Conectiv proposes building a natural gas combined cycle plant in Wilmington, which could generate about 200 megawatts of power. Bluewater Wind submitted a proposal for an offshore wind farm, which could generate up to 600 megawatts of power. Bluewater gave the state two options for the wind farm: One could be located about seven miles off Bethany Beach; the other would be located about 12 miles off Rehoboth Beach.
Each wind farm would have 200 wind turbines. NRG Energy, owners of the Indian River Power Plant in Millsboro, proposed building a 600-megawatt coal gasification system.
“Looking at the price alone, Delmarva estimates the NRG bid would cost its customers $4 billion to $5 billion more than buying the power from the wholesale market, and Bluewater’s proposals would result in customers paying prices $2 billion over market forecast,” read the report. “Accordingly, the company recommends that the state agencies should not approve any of the bids.”
Choosing none of the bids was always an option, said Public Service Commission officials, but the evaluation released this week does not necessarily reflect the decision that will be made by the PSC, the Controller General’s office, the Office of Management and Budget, the Delaware Energy Office and the Delaware Department of Natural Resources and Environmental Control (DNREC). The PSC is still waiting for a separate evaluation from the independent consultant. The evaluations will be reviewed and discussed prior to the PSC and the agencies making a final recommendation to Delmarva Power.
Conectiv scored highest on issues of price, price exposure, operation date, reliability of technology, site development, bidder experience and project finance-ability. Its proposal also scored second on environmental impact because natural gas is a clean-burning fuel and Conectiv plans to build the facility at its existing Hay Road power facility. In total, Conectiv scored 66.7, Bluewater 50.4 and NRG came in last with 20.5 points.
Bluewater scored highest on environmental impact, achieving 11.3 out of the possible 14 points. Conectiv received 9.9 points, while NRG got 5.7 points.
Contact Rachel Swick at: rswick@capegazette.com
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