NEW YORK Nov 8 Bluewater Wind wants to keep negotiating
with Delaware to secure a power purchase agreement that will allow the wind
power developer to build a 450-megawatt offshore wind farm.
The state Public Service Commission staff released a report on
Bluewater's Delaware Offshore Wind Park that recommended against the
project as currently proposed due to the potential high cost to power
The proposed 150-turbine, 450-megawatt wind farm would provide enough
energy for as many as 100,000 homes. The turbines would be located 11 miles
In its report last month, the PSC staff found the project could cost
more than $1 billion over Bluewater's initial bid due in part to price
escalators tied to possible increases in commodities and currency exchange
rates, among other things.
Bluewater, a subsidiary of Australian investment firm Babcock & Brown
Ltd BNB.AX, currently estimates the project would cost about $1.6
Officials at Bluewater and the state PSC were not immediately available
In a filing with the PSC this week, Bluewater said it does not expect
the high cost scenario described in the staff report to occur and wants to
work with the staff and other state agencies to resolve the cost concern.
DELAWARE AND BLUEWATER
The Delaware Legislature in 2006 directed the local power company,
Delmarva, to contract with new power resources to guarantee stable prices
for power following a rate increase of over 50 percent due to a rise in
power supply costs.
Delmarva, a subsidiary of Pepco Holdings Inc POM.N, issued a request
for proposals in November 2006.
Bluewater submitted two proposals and the state in May 2007 ordered
Delmarva to negotiate with Bluewater on a power purchase agreement.
Since Delmarva would ultimately pass on the cost of the power purchase
agreement to customers, the PSC needs to make sure the contract is in the
best interests of ratepayers.
Bluewater has said it could start generating some power at the wind
farm as soon as the third quarter of 2011 if the state approves of the
(Reporting by Scott DiSavino; Editing by John Picinich)