Lie # 1:

The proposed charges for a 25-year Bluewater-Delmarva PPA are substantially above market rates.

Fact: The current bids purchased by Delmarva Power, as of March 2008, with all charges included, were $110 per MWh. Bluewater’s maximum price set for the next twenty five years, bundled with all possible charges, is locked in at $105 per Mwh. $105 is not larger than $110.

Lie #2:

Bluewater’s competitive pricing was achieved by “Modifying the underlying assumptions about future market conditions.”

As Tommywonk is prone to say, by questioning that natural gas prices will not go down, we are being accused of misleading the public.

Fact: Natural Gas prices did not go down as consultants predicted. They went up. Check out the latest prices.

What? Natural Prices Did Not Go Down?

As of yesterday, prices at nearly every trading location had increased on the week between 2 and 37 cents per MMBtu. The Henry Hub spot price increased 22 cents to $10.33 per MMBtu. The average regional spot price in Louisiana was $10.26 per MMBtu, about 24 cents higher than the previous Wednesday’s price. Prices in the Northeast yesterday averaged $10.95 per MMBtu, the highest average regional price in the Lower 48 States.

Lie #3

Perhaps the most useful cost comparison is between market rates for SOS customers

Fact: This comparative tool allows one to use a theoretical market price, in this case one contrived by speculation that carbon fuel prices will decline, and assuming that there will never be any carbon tax levied against those fuels. Even though both of these anticipate scenarios are highly unlikely, it still allows its proponents false footing on which to establish their argument that Bluewater is more expensive than “their idea of” market.

A better tool is to look at what we will spend: ie how much will it cost you and me. As mentioned above, we will spend $105 per MWh for twenty five years. Delmarva is currently spending $110 per MWh for our electricity now. Delmarva is already costing us more than Bluewater Wind ever will, and contrary to those consultants hired by Delmarva Power, since gas prices climbed instead of falling, it appears Delmarva will cost us much more in the future.

Lie #4

The total above-market cost of the proposed wind farm is estimated to be between $1.3 billion and $2.1 billion.

Fact: The market cost as previously mentioned does not reflect the reality we are paying for today. If one throws everything out, and focuses just on the $5 difference between what Delmarva will buy from Bluewater and what it buys at today’s market price, that $5 per MWh over each MWh sold for the twenty-five year life of Bluewater’s contract, will save Delawarean SOS customers 170 million dollars. If gas or coal costs rise any further, so does the amount we save over what we would have spent doing nothing.

We cannot reiterate enough, that using this market price comparisons are only credible if correct pricing is applied to both categories, not just one.

The single flaw of this analysis, is that this entire report is based on the comparison of Bluewater Wind to a model that with each passing day, seems more and more impossible to obtain in today’s shrinking energy market.

Arguments that the Senate Energy Committee’s report is one sided,… are valid. For nowhere in the report can one find mention that in today’s market, Bluewater Wind is cheaper than what Delmarva pays right now.

One has to give McDowell credit for stretching. If there were any way to make Bluewater Wind appear expensive, it would be to use old outdated pricing for Delmarva Power.

Of course anyone is capable of creating data showing that today’s prices are higher than those experienced at some point in our past. But you would be a fool to base your daily purchasing decisions on what you used to pay for things years ago.