As market shifts, time to change offshore wind-energy policy

Guest Column:
William H. Ferguson
Rep. Joseph M. McNamara, D-Warwick, has proposed a bill, which has gotten substantial attention by the state’s news media, to make calamari the official state appetizer. More

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OP ED/LETTERS TO THE EDITOR

As market shifts, time to change offshore wind-energy policy

Guest Column:
William H. Ferguson
Posted 3/18/13

Rep. Joseph M. McNamara, D-Warwick, has proposed a bill, which has gotten substantial attention by the state’s news media, to make calamari the official state appetizer.

It’s good to talk about calamari. High unemployment, the bad economy, public-pension shortfalls, bankrupt cities, bad decisions, 38 Studios, all have dominated the discussion in Rhode Island. The calamari discussion is a nice break. And maybe we can use it as a turning point to rededicate ourselves to doing things better, to prevent problems instead of reacting to them, and to move proactively to correct problems before it is too late.

It is much less expensive to prevent problems than to fix them. In order to do that, we have to be able to plan ahead and objectively evaluate decisions at all levels (by the congressional delegation, the state legislature, the state executive department and local government) before they are made.

Deepwater Wind is an example of this. Currently, it flies under the radar of the media that in the past has so often served to bring issues to a head. At the federal level, they say it is a state responsibility. And at the state level, they say it is a federal responsibility.

There will be a lot of finger-pointing going on when the project is built and the cost impacts on electric ratepayers take effect. Finger-pointing may be a good political strategy, but it is not a good economic-development strategy.

On this issue, just as on the calamari initiative, I believe that the General Assembly needs to take the lead. This body passed the bills that implemented an offshore wind policy formulated by then-Gov. Donald L. Carcieri. He is not in office anymore, but the problem is [still here], and so is the General Assembly. For the amount of time and effort that it takes to draft and submit the calamari bill, a bill can be submitted to revisit our offshore wind policy.

This is not a witch hunt or a blame game. The fact is that when the offshore wind project was first conceived, the Standard Offer Service cost of electricity in Rhode Island was 12.4 cents per kilowatt-hour, and it was expected to increase (so much so that offshore liquefied natural gas terminals were being proposed up and down the Northeast coast).

Instead, electricity has declined to less than 7 cents/kwh. Obviously, this is a major change in circumstances that cries out for reconsideration in the public interest.

In 2007, it was thought that Deepwater Wind would eventually be less expensive than conventional electricity. We now know it will cost four times the going rate for electricity and result in a total ratepayer cost increase of $431 million. This is only Phase I. The next phase is a large-scale offshore wind project which could result in a cost increase to Rhode Island consumers of $4 billion.

If the calamari bill increased the cost of calamari by a factor of four it would probably get a lot of scrutiny by many interested and concerned parties. We should treat offshore wind with an equal or even greater level of concern, even though it is more complicated. Being complicated should not be a reason to ignore it. This is how we get the wool pulled over our eyes. •


William H. Ferguson is the executive director of TEC-RI, a nonprofit designed to achieve affordable and reliable energy in an environmentally sound manner. Previously he served as deputy director of the R.I. State Energy Office, was associate director of the R.I. Department of Administration, the R.I. energy-conservation officer and program manager at RISE Engineering.

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