Your noble attempt to feign disinterest is cause for a smile.

I understand your arguments, and for one, I am flattered that they are substantive, and not the usual frivolity we are used to seeing coming from our states own utility’s lawyers: for instance, a fabricated comparison that initially used obsolete pre-rate-hike 2006 prices in order to show that offshore wind was too expensive.

Allow me to address a couple of your concerns. You, no doubt, are familiar with principals of math, so you should most certainly be aware of the property of equivalence which states that if you multiply or add an equal amount to both sides, you can eventually dismiss the effect caused by that number, because both sides equal out. The added 2.5% escalation charge to account for inflation, to which you take issue, will be paid by Delawareans whether we get our energy from Bluewater Wind or not. We have been paying Delmarva that escalation rate since 1979.

What is at stake to us is the direct cost of acquiring energy: a flat rate versus an exponentially scaled increasing rate. The acquisition of energy from Bluewater Wind will be 9.893 cents per kWh during the twenty five year length of the contract.

I would like to direct your attention to this study, with which you may already be familiar..

The European Commission launched the project in 1991 in collaboration with the US Department of Energy, and it was the first research project of its kind “to put plausible financial figures against damage resulting from different forms of electricity production for the entire EU”. The methodology considers emissions, dispersion and ultimate impact. With nuclear energy the risk of accidents is factored in along with high estimates of radiological impacts from mine tailings (waste management and decommissioning being already within the cost to the consumer). Nuclear energy averages 0.4 euro cents/kWh, much the same as hydro, coal is over 4.0 cents (4.1-7.3), gas ranges 1.3-2.3 cents and only wind shows up better than nuclear, at 0.1-0.2 cents/kWh average. NB these are the external costs only.

(The external costs are defined as those actually incurred in relation to health and the environment and quantifiable but not built into the cost of the electricity.)

And not internal costs. From the same study (right click on image if you see only a partial image):

Comparitive Costs of Electricity

There is no question that on shore wind can be less costly. But what needs to be OUR true question, is whether it can be less costly for Delawareans. For as one can see from the chart above, our 9.893 cents per kwh lies directly in the middle of the onshore spread and near the low end of the offshore possibilities.

Additionally, the building of Bluewater Wind would totally and completely satisfy Delaware’s aggressive RPS standard (20%) and eliminate each and every SOS customers’ exposure to costly REC compliance payments. Those mandatory payments are fines levied on each energy company which DOES NOT meet the 20% RPS standard set by our legislature. Those fines are not eaten by the utilities, but are instead, passed on to us

Under the existing contract, enough REC’s will be generated during the span of this project, so that during its lifetime, SOS customers will never have to pay for this hefty increase.

The PSC was quick to point out (having dealt with Delmarva for years) that there was no guarantee that Delmarva would seek to satisfy all its RPS requirements. Particularly should Pepco shareholders choose to benefit and make more profit, by having Delmarva buy energy from its sister company, and subsequently pass their fines down to us, …one can find very little incentive out there, other than public outcry, to cause Delmarva to comply…….

“Significantly, even if a competitive auction resulted in a proposal for the procurement of renewable energy at a lower price than Bluewater’s project, there exists a possibility that Delmarva could elect not to choose it as part of its resource planning and continue to purchase energy from the PJM market.”

So if we were to apply bottom line analysis, one can see that if you are honest about all charges, offshore wind is competitive with that wind coming onshore.

And when one factors external costs ……..there appears to be no contest.