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As wind-power advocates await a decision from state officials on a contract that could lead to the nation’s first offshore wind farm, Maryland Gov. Martin O’Malley announced this week he is interested in having his state go in with Delaware on the venture. Wind farm followers say getting Maryland on board and regionalizing the project will be an economic benefit to Bluewater Wind and its customers.
A contract between Bluewater Wind and Delmarva Power, now in the hands of the Public Service Commission and representatives of three other state agencies, is designed so the developer can expand the project to produce as many as 600 megawatts of power. That would allow for regionalization of the project.
O’Malley spoke with Lt. Gov. John Carney, a wind farm supporter, at a National Governors’ Association conference last weekend. Carney said O’Malley was very interested in regionalizing the Delaware project.
Carney said, “We want to make the project as large as possible so the economics of it will work better and we can reduce risk.”
Economist Tom Noyes has closely followed Delaware’s path to wind power. “Bringing in Maryland would improve the economics for Bluewater. The unit cost for adding 50 to 100 turbines would be less than the unit cost for building a new wind farm,” he said.
The final contract, signed June 23, provides for Delmarva Power to purchase up to 200 megawatts of power from Bluewater Wind’s project, slated to be built more than 11 miles off Rehoboth Beach. The contract also allows Bluewater Wind to expand the project to produce up to 600 megawatts of power, but that would require securing other customers, such as Maryland.
University of Delaware professor Jeremy Firestone said an independent consultant for the state said the price to consumers from the contract was close to anticipated market prices. “There is little reason for others to not buy in,” he said, saying the possibility of a larger project is encouraging.
Firestone said both Democrats running for governor, Carney and State Treasurer Jack Markell, have expressed interest in Delaware buying power from the Bluewater Wind project.
Jim Lanard, spokesman for Bluewater Wind, said he had spoken with O’Malley and with Maryland energy officials this week. He said the process for state procurement of energy is very complicated. “We are looking at alternative means so Maryland can buy power from our Delaware project,” he said.
But as of now, Lanard said, the parties are not talking specifics. They are looking at ways to make a step toward regionalization work, he said.
Carney said Maryland’s interest is encouraging. “I think this is a big step forward and a very positive thing as we attempt to make the project bigger,” he said. Earlier this year, Carney secured a commitment from Bluewater Wind’s parent company, Babcock and Brown, to make Delaware the hub of regional development should the Delaware project be constructed. Carney said a larger wind farm would mean more jobs for Delaware.
Bluewater Wind officials called the Delmarva Power deal an anchor contract for its project, and the company hopes to use that deal to bring in other customers.
Noyes said, “The advantage to Maryland would be that it could piggyback off an existing project rather than have to build the infrastructure for an entirely new project.”
Rehoboth Beach resident Marc Weiss said, “I’m not surprised because both Maryland and New Jersey are considering building on the precedent set by Delaware or purchasing power from the project.”
The Public Service Commission held a public hearing Thursday, July 17, so members of the public could weigh in on the contract between Bluewater Wind and Delmarva Power.
Representatives of four state agencies are expected to cast their final vote on the contract Thursday, July 31.
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