HALLOWELL, Maine — The Maine Public Utilities Commission on Thursday suggested that Statoil North America revise its proposal to provide greater assurances that Maine will reap long-term benefits from a pilot wind energy project off the coast of Maine.
Otherwise, two of the three commissioners said they would not support it.
“The commission will issue a procedural order to suggest ways the term sheet could be improved,” said Karen Geraghty, administrative director of the PUC. She said she expects the order to be released Friday or Tuesday.
After two hours of discussion Thursday, commissioners Mark Vannoy and Thomas Welch said they would not vote for the term sheet as written. They expressed concerns about the impact on ratepayers of the higher cost of electricity generated by the pilot project, which would place four floating wind turbines off the coast of Maine, and about what commitments Statoil could make to extend its relationship with Maine beyond the pilot project.
“Statoil was hoping for a unanimous conclusion from PUC today to be able to continue maturing the project,” Ola Morten Aanestad, Statoil North America’s vice president for communications, wrote in an email. “We now need to take this information we got today back, and evaluate how we can proceed further.”
As a pilot project for more extensive development of offshore wind energy production, Statoil North America proposes to moor four floating turbines in federal waters off the coast of Maine to generate 12 megawatts of energy. On May 2, 2011, Statoil North America submitted a proposal for the project, called Hywind Maine, to the Maine Public Utilities Commission, which had issued a request for proposals after the Legislature passed the 2010 Ocean Energy Act.
Habib Dagher of the Advanced Structures and Composites Center at the University of Maine, which is working with Statoil and independently to refine floating offshore wind energy turbine technology, emphasized that the PUC commissioners did not question the viability of using floating turbines for offshore wind energy generation. He described Thursday’s deliberations as part of a complex negotiation process.
“The commission is looking out for the interests of the state of Maine,” Dagher said Thursday by phone. “I hope we can find a middle ground and move forward.”
“As far as the university is concerned, we would like to see Statoil come to Maine, but the University of Maine is still moving forward with plans to have a prototype turbine in the water during the first quarter of 2013. They are an excellent company,” Dagher said of Statoil. “Having them come here is like having GM or Apple come here. We all want them to come to Maine and invest in Maine.”
In comments responding to the term sheet Statoil submitted in August, Ken Fletcher, director of the Maine Energy Office, raised questions about the impact on ratepayers and the return on Maine’s investment in the project.
“The proposal sets the electricity price at a minimum of $290/MWh, which is significantly higher than historic and current prices,” Fletcher wrote. “Over the 20-year contract term, Maine ratepayers could be required to pay $203 million higher costs.”
“I don’t know if Maine ratepayers can shoulder $10 million per year without more assurance that this will work,” Fletcher told the Bangor Daily News in September, emphasizing that he’s not opposed to offshore wind energy on principle, but that the project must make sense from a business standpoint.
On Thursday, PUC Commissioner Mark Vannoy expressed similar concerns about the risk to ratepayers and the absence of stronger commitment from Statoil that the pilot project will yield greater economic benefits for Maine in the future.
Vannoy said he would like to see Statoil “be more concrete in its benefits for Maine.” He also expressed reservations about whether the technology Statoil is researching would ever lower electricity costs from offshore wind generation enough to produce significant economic development in Maine.
Thomas Welch, chairman of the PUC, also suggested that the commission decline the term sheet at this time, with the suggestion that Statoil make stronger commitments to ensure that Maine be better positioned to benefit from commercialization of the Hywind research and development project.
Welch acknowledged the risk that declining to support the Statoil proposal could deprive Maine of a major opportunity for significant economic development, but “on balance, I find an unacceptably high risk that no or little benefit to Maine will accrue from the term sheet as written,” he said.
Welch then offered specific suggestions for how Statoil could ease his concerns about the risks the project poses to ratepayers. If Statoil presents sufficient means to balance “potential benefits and certain costs” and “shore up the connection between the pilot and substantial benefits to Maine,” Welch said he could support the project.
Commissioner David Littell strongly advocated for the project as a reasonable investment that could provide significant benefits for Maine.
The commission voted unanimously to table action on the term sheet, pending a response from Statoil.
Approval of the term sheet would allow Statoil to enter into a long-term contract to sell electricity generated by the pilot project at above-market prices to one or more of Maine’s investor-owned utilities — Bangor Hydro, Central Maine Power or Maine Public Service Company.
A separate federal process to determine competitive interest and environmental effects of Statoil’s proposal is under way through the Bureau of Ocean Energy Management.
Thanks to the PUC approval of Baldacci’s massive grid upgrade solely for wind power, CMP ratepayers saw a 19.6% transmission rate hike on July 1.
To read the facts, google “What every Maine ratepayer needs to know”.
oh, come on man, the Maine people are not going to figure it out…
they’ve split the energy bill up six ways to Sunday….what better way to slowly raise rates in an obtuse, incremental fashion….a little bit here, a little bit there, and presto, your bill just went up 30% over the last 3 years, and you didn’t even notice…..High fives all around….the bonus season is upon us…..start planning those vacations folks…..spend, spend, spend!!
Off shore wind is just a more expensive extension of the heavily taxpayer financed wind boondoggle that is destroying Maine’s mountains for under-performing, unreliable wind power.
Filling the Gulf of Maine with floating wind turbines is a pipe dream that is not in our best interests. I hope that Congress stays the course and in an effort to actually cut wasteful spending, refuses to extend the Production Tax Credit (PTC). Without the PTC, the wind industry has stated it cannot survive because with it’s huge capital investment costs for the feeble amount of electricity it produces, wind simply cannot compete. Without the PTC, Statoil NA will retreat to it’s socialist base in Norway.
The shallow water Block Island, RI project is utilizing “off the shelf” existing technology to put wind turbines on monopoles secured directly to the ocean floor. That project will be selling it’s output at 24 cents per KWH, five times the existing wholesale rate. This proposal is at a minimum 29 cents per KWH and you have to konw that is a low-ball figure.
Developing new technology and designing huge wind turbines on floating platforms that can more than withstand a repeat of “The Perfect Storm”–two days of hurricane force winds and 40 foot seas–is a preposterously expensive proposition. I predict it will be at least double the cost of Block Island.
The ideologically driven dreamers promote the wind scam on land and at sea. It is time to end the PTC and let the free market determine our electricity generating sources, not politicians pandering to a special interest group.
PUC Commissioner Littell advocated for the project–no news there. He was bought & paid for by the wind industry when he was Commissioner of DEP. His ethics of being a shill for the wind industry are an embarassment and he should recuse himself from every case that comes to PUC that relates to wind.
Better yet, he should just resign and take a job directly with the wind thieves like his buddy Kurt Adams did. Adams negotiated himself a nice package with First Wind while still on the PUC, so Littell should follow. Then maybe Gov. LePage could appoint someone who will watch out for Maine consumers and the constant raid on our economy. Put the Public’s interest foremost in the Public Utilities Commission.
The PUC is supposed to protect the interests of Maine consumers, not sell them out to scams, Mr. Littell.
Lepage is not about to appoint anyone who will watch out for Maine consumers. Even a cursory check of the commissioners now at the helm reveals that most were previously employed by the law firm of Pierce-Atwood, whose major client is…CMP. No conflict there, eh?
Just another example of the dirty dealings in this (mis)administration.
Kurt Adams. David Littell, and the wind industry. We keep being hammered by the fallout of corruption by the Baldacci administration. Baldacci sold out the state to the wind scam and these guys were major players.
Since when is it the PUC’s concern to promote economic development? They are rolling OUR dice in a high risk high stakes game of chance. This is a research project where the researcher is also a developer who stands to plug into a gravy train like none other in Maine history. Who really thinks they are going to come back with results from the testing that indicate non-viability?
Market electric rates are 3 cents now, and these “investors” not only want us to bear the 30 cent risk during the demonstration…they will get the same PUC to mandate long term contracts that we pay for, so that their commercial operation is a no-turning back fools errand for Maine ratepayers. And Commissioners like Littell display zero critical thinking in protecting ratepayers.
These offshore gizmos are groovy, for sure. But they will be forced upon ratepayers in a state that already pays some of the highest electricity rates in the nation. Maine already has among the cleanest electricity generation mix of any state, with 99.6% of it coming from clean sources other than oil. And we have LOADS of it. Build more and send us the bill!
We have NO proof that any of these windmills can replace or even displace conventional generators. Not to mention shelf life. And who cares how many jobs are created building the useless things if Maine’s electric rates double? Jobs will fly over the Portsmouth bridge.
These folks want to build all this unnecessary and untested generation that puts all of us on the hook. If Statoil wants to draw down from the Maine annuity for 30 years, let them take the risk, not us. The commissioners are engaged in mission creep and they need to just do their job or find another line of work.
We caught Paul Violett
We caught Dale McCormick (almost!)
It’s time to take a long hard look at the Maine PUC.
Commissioner Littell is chairman of the northeast’s Regional Greenhouse Gas Initiative (RGGI). As a PUC commissioner he is required to ensure fair and reasonable electricity rates. As RGGI chair, he is required to shove sky high wind power down our throats.
To me that is a conflict that Mainers should not stand for.
I just traveled to Europe… Wind turbines ALL over the areas with wind… Residents WELCOME them… Those of you “experts” that say they are loud are full of gas… You have NEVER been near one… You Cannot hear one of the largest ones more than 150 yards away… They are designed to last over 20 years… In Germany, highways are lined with solar panels. Instead of fences or barriers to block road noise, they use solar panels, they are GOVERNMENT sponsored… That is because they don’t allow BRIBES by OIL and other companies to influence elections… They don’t have Faux news constantly promoting the Billionaires like Romney… In ten years gas and oil will be $20. per gallon… Within 10 years, efficient and long range electric cars will be available… Stop the Give Away of $4 BILLION of tax credits to BIG OIL…. Tax the hell out of them… Stop Using COAL power… There is no such thing as CLEAN COAL, and never will be… The GOP, owned by Big Oil and coal companies, TELLS you that wind and solar energy is BAD, how ignorant is that…??? Think of your children… Within 10 years we could be employing 40% of our power in the USA using wind and solar… also employing Millions of workers, instead of depending on Mideast Oil… We would not have to start Wars, like in Iraq, to steal oil for Exxon.. Wind is FREE, it’s for me…!!!
So much hogwash, so little time. Too much bad information here to even address.
You might want to check out a few articles detailing Germany’s experience with renewables as of late. They’re not exactly the poster child for renewables that you’re describing.
http://www.spiegel.de/international/germany/germany-s-energy-revolution-stalls-without-decisiveness-and-incentives-a-834565.html
http://www.spiegel.de/international/business/merkel-s-switch-to-renewables-rising-energy-prices-endanger-german-industry-a-816669.html
http://www.tax-news.com/news/Germany_Eyes_Special_Levy_On_Eco_Energy_Providers____57124.html
http://wattsupwiththat.com/2012/08/28/germanys-new-renewable-energy-policy/
http://www.bloomberg.com/news/2012-08-19/merkel-s-green-shift-forces-germany-to-burn-more-coal-energy.html
http://www.spiegel.de/international/germany/germany-s-energy-revolution-stalls-without-decisiveness-and-incentives-a-834565.html
In a recent Newsweek article by environmentalist, Bjorn Lomborg, he states that Germany’s investment in solar power would net CO2 emissions reductions that would delay global warming by just 23 hours by the end of the century. Exploring all of our energy options is a positive thing as long as we’re honest with ourselves about what we find.
http://www.thedailybeast.com/newsweek/2012/05/27/bjorn-lomborg-on-the-rio-green-summit-poverty-pollutes.html
Europe is governed by Socialists and green zealots. Everything there is more expensive and the economy is far more sluggish and in some places receeding as a result. Get your liberal head out of where the sun never shines and pay attention to science and economics. Wind turbines don’t work worth a damn and would never be put up without massive government subsidies.
Spain is part of Europe last time I looked and see what happened to their economy from the wonders of wind power. But now we have Spain’s Iberdrola owning our CMP and aggressively building wind power sites here in the USA—as long as the TAX SUBSIDIES are there. If the PTC goes (which will happen if the Federal gov’t ever gets realistic about cutting spending!), Iberdrola will fold it’s wind tent and move out, just as in Spain when the Spanish gov’t cut subsidies in an attempt to avoid going broke.
Then there is Denmark, also a Socialist European country that has the greatest % of electricty coming from wind turbines. The result is the highest electricty rates of all the developed countries in the world. We must not impose this on our USA economy.
The Norwegian government owns about 65% of Statoil. Can’t see why the rate payers of Maine should subsidize Norway. Norway has one of the highest per capita incomes in the world — number 4 just behind Luxembourg, Bermuda, the U.A.E.
Statoil smells sucker Americans willing to be separated from their money.
From Wikipedia:
Statoil ASA, trading as Statoil and formerly known as StatoilHydro, is a Norwegian oil and gas company, formed by the 2007 merger of Statoil with the oil and gas division of Norsk Hydro.[2] The Government of Norway is the largest shareholder in Statoil with 67% of the shares. The ownership interest is managed by the Norwegian Ministry of Petroleum and Energy.[3]Statoil is a fully integrated petroleum company with operations in thirty six countries. By revenue Statoil was in 2010 ranked by Fortune Magazine as the world’s 13th largest oil and gas company, and the largest company in the Nordic region by revenue, profit, and market capitalization.[4]
The government of Quebec owns Hydro Quebec. We are terrified to even TALK with them. And we are already transmission connected with them. And there’s nothing risky or experimental about the electricity they offer. Think about it. We have all the electricity we need right now. And 99.6% of Maine’s generation comes from clean sources other than oil and coal. IF we ever do need more electricity, why would we replace the wheel (not reinvent) with this hare-brained boondoggle when Quebec and Newfoundland have gobs of surplus green power in the summer, when our needs are high and their needs are low? If your kids made these kinds of decisions you’d send them to their room.
Simple solution to the problem. Tell them they are free to build their wind turbines but they can only charge the same rate per kilowatt as natural gas fired power plants get.
Never mind the cash needed to build wind turbines out at sea, new British data shows that
merely connecting them to the grid costs more per megawatt than building new gas fired power plants.
http://www.reuters.com/article/2012/10/02/column-wynn-wind-costs-idUSL6E8K243Q20121002