Deepwater Wind moves ahead
“We’re moving rapidly toward financial close,” declared Deepwater Wind project manager Bryan Wilson at a meeting for the Electric Utility Task Group (EUTG) on Monday, Sept. 22. “The project is well under construction. This is really happening.”
The Deepwater update was on the agenda for the meeting, and Wilson was happy to appear and give the EUTG the project’s status. He was the only person from the public who appeared at the meeting before Chair Barbara MacMullen, Vice Chair Everett Shorey and William Penn. Wilson informed the EUTG that everything is on schedule with the Block Island wind farm project.
“In the summer of 2015 we will install the foundations,” said Wilson. “In 2016 the submarine cable will be laid. And by August of 2016 the switch will be flipped.”
This contradicts what Deepwater Wind CEO Jeffrey Grybowski told The Block Island Times during a phone interview on Sept. 9. At that time, Grybowski claimed that the project would be up and running in the fall of 2016. If Wilson is correct, then this puts the project slightly ahead of schedule.
“This keeps us fully on track with our scheduling,” said a visibly pleased Wilson.
Wilson went on to inform the EUTG that financial close will happen by the end of the year (2014). He noted that they had originally targeted a closing date of November.
“Once we have financial close then the big ticket items will be purchased,” Wilson said. “Like the cable. Portions of the turbines have been purchased. They are being produced in France.”
After the EUTG meeting adjourned, Wilson made himself available to The Block Island Times to answer a few questions outside, in front of Town Hall.
“We’re excited to be fully approved,” Wilson said. “We just need the agreement of BOEM (Bureau of Offshore Energy Management) to approve the installation of running the underwater cable through nine miles of federal sea floor.”
He was referring to the proposed underwater electric cable that will run between Block Island and the mainland. Wilson noted that the cable will run through three miles of state waters and nine miles of federal waters. He also said that the cable part of the project has been fully vetted by BOEM, as well as the Army Corps of Engineers.
“There have been no objections to it,” he said. “It’s essentially this one last hurdle. But we don’t want to focus on this one small item.”
Wilson said that when former Rhode Island Governor Donald Carcieri chose Deepwater Wind as the developer/contractor to construct the Block Island wind farm, that it would attempt to solve three things; the Block Island power problem, the Renewable Portfolio Standard, and talk about utilizing wind resources. He also said that in 2009, Deepwater signed an agreement under state law with National Grid to sell the power generated from the 30-Megawatt Block Island wind farm at a cost of $0.24 per kWh.
“This is a state project, and the CRMC (Coastal Resources Management Council) has done the majority of the heavy lifting,” Wilson said. “The Army Corps of Engineers drafted behind the progress being made by the CRMC.”
Shortly after answering a few questions, Wilson was joined by Everett Shorey in defense of the Deepwater wind farm project.
“There has been a lot of misinformation out there about this project that needs to be set straight,” said a vocal Shorey, who claims that the role of the EUTG is to advise and monitor the wind farm project’s progress. “The EUTG has issued a series of reports to the Town Council on the relative costs of various generation/supply options for electricity. We have another one that has been approved by the EUTG, and Barbara MacMullen (EUTG Chair) and I are working out the final details.”
Shorey went on to explain that a subsidized cable to the mainland will provide the lowest cost of power. “We have an analysis from a power marketing company of the actual Block Island load versus mainland wholesale prices (ISO New England) that indicates a landed cost to the island of about $0.10 per kWh,” Shorey said. “The most recent filings by National Grid with the controlling regulatory body, the FERC (Federal Energy Regulatory Commission), show a cable charge to Block Island of about $30,000-50,000 per year. We estimate that this will replace roughly $3 million per year in oil for BIPCo with $1 million in purchased power and cable charges.”
“Deepwater Wind does not conduct its own power reduction studies,” said Wilson. “We accept the EUTG as an authority on that.”
During an interesting part of the discussion, Shorey and Wilson spoke about looking at the wind farm project from both sides. They both said that they have spent time listening to the arguments against the project. But, in the end, they both feel that the pros outweigh the cons, and that there will be considerable savings to ratepayers.
“We try to listen to the facts from everybody,” said Shorey. “I probably wander into legal issues more than I should. But, I’ve done rate filing and economic analysis filings as a volunteer. I’ve been involved with the rate filing process for both the Block Island Power Company and Interstate Navigation.”
Other misinformation that Shorey noted, are claims that the cost of purchased power will be greater than $0.10 kWh, and that the island can afford its own cable.
“There is no evidence that the cost of purchased power will be greater,” Shorey said. “And there is no scenario that shows how a cable can be constructed for less than the $30 million breakeven cost.”
“It’s not a viable option at $30 million,” said Wilson. “It’s never been approved as a stand alone cable. So, without massive state or federal subsidies there is no way that Block Island can afford that. The initial studies didn’t include upload facilities – the substations where you plug in the cable, that are very expensive.”
“If you think the project is a good idea, then the financial close is a useful milestone,” said Shorey. “If you think the project is a bad idea, then it is one more step towards perdition.”
After Shorey departed, the interview continued with Wilson who seemed eager to continue discussing Deepwater’s progress. He mentioned that the CRMC has been involved with a first-of-its-kind ocean zoning called Ocean SAMP (Rhode Island Ocean Special Area Management Plan). According to its website, Ocean SAMP is a strategy for zoning Rhode Island’s offshore waters using an ecosystem approach that involves scientific research and public input to help develop policy. Their approach looks comprehensively at the area’s characteristics, resources, uses, and constraints, related to proposed renewable energy development.
Wilson, a resident of the west side of Block island, said that he doesn’t like the fact that he and other islanders are paying such a high monthly power bill. On a related subject, he said that BIPCo needs $4 million to stabilize voltage and improve the quality of power on Block Island.
As for his thoughts about the EUTG: “They have been enormously helpful,” Wilson said. “The EUTG has been an important interface between New Shoreham and the private company (Deepwater Wind). They have done their job for the town and done it really well.”
When asked what he thought about Deepwater Resistance Chair Bob Shield’s complaint in Superior Court against Deepwater Wind and the CRMC, Wilson said, “Everyone gets their day in court.”