If you were blessed with one too few neurons and found the numbers flung back and forth between Delmarva and the rest of us, to be mildly put, as slightly bewildering, and were to be blunt, scared to pass the Bluewater Wind HCR 38 because you didn’t want to be saddled with another Delmarva Price increase around your neck……………………………well, you can relax. Help is on the way!

Courtesy of Delmarva.

Here is the line your lobbyists have been giving you.

over the 25 years of the PPA, into above-market cost of, respectively, $1.7 billion (ICF) and $2.0 bilion (Pace). (In its October 29 Report, the Commission Staffs independent consultant (the “IC”) made certain above-market calculations. If the commodity pricing escalators are removed from those calculations, the result is similar above-market costs of $1.3 billion.)

There it is.

Now let’s break it down. The actual “facts” between both parties are the same, or very close. By that, I mean that the actual cost estimated to build an offshore plant is not far apart, whether the consultant came from Delmarva or was truly independent. What is at stake is frank discussion about how much the offshore wind will cost us over market and just exactly what over market is.

What we need in this discussion is a floor that determines exactly what “market” is.

Delmarva originally used 2005 prices (Table 2.1.2) to determine what market was. When called out on that, they used 2007 prices, which shrunk the differences considerably. Most of us independents doing analysis on prices use the future’s index as a guide for “what we anticipate we will pay in the future”.

(For example: if one takes todays cost of $110MWh and applies it to Delmarva’s original formula for determining cost above market, Delmarva is already predicted to run (1106GWh/year X 1000 MWh/GWh X 25 dollar increase X 25years) = $691,250,000 above-market in less than six months since Russ Larson voted no!)

We seem to have the upper hand. Bluewater’s bundled price, which means it includes REC charges and something called capacity costs, is close to $105 per MWh., and will stay so over the next thirty years. Currently, as mentioned above, Delmarva in March announced the lowest cost of energy it would receive over the next three years, would be $110 per MWh and by everyone’s estimate, is expected to rise considerably.

Who seems to have a better handle on the market now?

Realistically at their prices right now, Bluewater Wind and Delmarva are close to a statistical wash. Whether or not Bluewater Wind is a really good deal boils down to one thing: whether the cost of getting our energy the old way, from fossil fuels will rise over the next thirty years……..or fall.

You have only to fill up your car to get your answer.