LOS ANGELES (Reuters) - Pepco Holdings' Delmarva Power utility on Tuesday announced that it will seek bids for wind power for its customers in Delaware.
(In Tuesday story, corrects paragraph two to say company wants cost spread to all power customers in state, not to all of its customers.)
LOS ANGELES (Reuters) - Pepco Holdings' Delmarva Power utility on Tuesday announced that it will seek bids for wind power for its customers in Delaware.
The effort comes after a 450-megawatt proposed offshore wind project was placed on hold indefinitely last month by a panel of Delaware state agencies. Delmarva is against that offshore project because it is too expensive and the costs would not be spread to all power customers in Delaware, a company spokesman said.
Delmarva said on Tuesday that it does not yet know how much wind power will be purchased in the latest effort for land-based turbines. Results of the bid process are expected in March.
!ADVERTISEMENT!"We look to buy both renewable energy credits and energy for terms from 5 to 25 years," said Gary Stockbridge, Delmarva president, in a press release. "We will have results in hand by March that can be compared to the existing offshore proposal. We expect to see significantly lower costs, the same environmental benefits, far less risk, even more stability than with offshore wind power, and be able to provide this power years ahead of any offshore project."
Delmarva spokesman Bill Yingling said the utility will entertain bids from producers in the vast PJM grid area, which spans from the Mid-Atlantic to the Midwest.
Delmarva, citing a state review of the offshore project over 25 years would require customers to pay "a 45 percent premium for offshore wind generation over onshore wind generation."
Delaware last year passed legislation calling for 20 percent of power generation to come from renewable sources by 2019. In a mid-2008 count, Delmarva said renewable power accounted for 3 percent of its power deliveries.
Delmarva said it expects to offer requests for bids for solar power also, but Yingling said the utility has not set a date.
Delmarva Power has about 500,000 electricity and 121,000 natural gas customers in Delaware and Maryland.
Last month, the Delaware state controller didn't sign a contract for the Delaware Offshore Wind Park because of division in the state legislature, Delaware newspapers have reported.
The project is slated to have 150 wind turbines about 11 miles off Rehoboth Beach, Delaware. The cost to build the project is estimated at $1.6 billion to $2 billion.
The cost to Delmarva would be for the power purchased in the 25 years of the proposed contract, which would be near $5 billion, Delmarva said.
The project is proposed by Bluewater Wind, a unit of Babcock & Brown, which has main offices in Sydney and U.S. headquarters in San Francisco.
Last week, 28 Delaware legislators co-sponsored a bill recommending approval of the Bluewater contract.
The proposed legislation suggests the state's utility regulator, the Delaware Public Service Commission, spread cost of the project to all Delmarva customers, the published reports showed. The current proposal for the Bluewater project calls for the power purchases to be financed by small business and residential customers, who together use 28 percent of the power delivered in Delaware, Yingling said.
(Reporting by Bernie Woodall; Editing by Marguerita Choy)
