Governor Dannel P. Malloy announced today that Connecticut is taking another step forward toward achieving a cheaper, cleaner, and more reliable energy future for residents and businesses with the selection of two projects that will generate large amounts of electricity from clean energy sources -- helping to achieve renewable energy goals at lower costs to ratepayers.
The Governor said the cost of power from the two projects -- a solar installation slated for land in Sprague and Lisbon, Conn., and a wind energy farm in Maine -- will average under eight cents per kilowatt hour (k/Wh), a price close to matching the cost of power generated from conventional fossil fuel plants and some of the lowest costs ever obtained for solar and wind power in the region.
"The selection of these two projects is a major milestone in implementing our Comprehensive Energy Strategy," said Governor Malloy. "These projects bring real benefits -- cleaner power with no air emissions and improved reliability by diversifying our energy portfolio -- all at a cost comparable to electricity generated from conventional power plants. This is the most significant step Connecticut has ever taken to harness the power of clean energy and this announcement is truly a historic moment in Connecticut's energy history."
The two projects have signed long-term contracts with the state's two major electric distribution companies -- Connecticut Light & Power and United Illuminating -- for the purchase of the combined 270 megawatts (MW) of electricity and related renewable energy credits they will produce.
The two projects, both expected to be operational by the end of 2016, are:
* Number Nine Wind Farm, a 250 MW land-based wind farm to be located in Aroostook County, Maine. EDP Renewables North America LLC, an international leader in large-scale wind installations, is the project developer.
* Fusion Solar Center, a 20 MW AC solar photovoltaic system which will be located in Sprague and Lisbon, CT on land primarily owned by the Connecticut-based Fusion Paperboard Company. The project developer is HelioSage Energy, known nationally for its solar expertise.
"The pricing offered by these projects demonstrates that Connecticut's new approach to clean energy can spark innovation and competition among various technologies and drive down costs," said Commissioner Daniel C. Esty of the Department of Energy and Environmental Protection (DEEP). "We had wind, solar, fuel cells, tidal and biomass all competing for the same long term power contracts with the electric distribution companies -- and the clear winners were Connecticut's ratepayers."
Comments from Public Officials
State Senator Bob Duff and State Representative Lonnie Reed, co-chairs of the General Assembly's Energy and Technology Committee, were principal architects of the legislation that enabled the procurement to move forward.
Sen. Duff said, "I am thrilled to see that we are moving forward with renewable energy projects that provide environmental benefits, diversify our energy portfolio, improve reliability while leveraging federal tax credits to benefit Connecticut ratepayers."
Rep. Reed said, "This news is exciting evidence that we can indeed fulfill our promise to protect and also expand Connecticut's ambitious commitment to renewables. And we can do it by purchasing large scale, clean power generation at rational, affordable prices. It's proof positive that the new energy policies we fought for and adopted are great for consumers and great for the environment."
"These projects represent a significant step toward meeting our state's renewable energy goals in a cost-effective way that protects both the environment and ratepayers," said Attorney General George Jepsen. "We are pleased to have overseen the legal framework for the innovative and successful selection process. I congratulate Governor Malloy and Commissioner Esty as well as the project developers for these important achievements."
Consumer Counsel Elin Swanson Katz said, "This renewable energy procurement is a great success achieved in a tight time frame. We seemed to be facing a potential shortage of the renewable energy needed to meet the state's legal requirements by the end of the decade but the projects selected in this process will help to alleviate that concern, at prices that are quite attractive. I am also pleased the procurement process was conducted with great attention to detail, a focus on fairness to all bidders, included solid analysis, and that professionals in my Office were involved and informed at every step."
Comments from Environmental Leaders
President of the Conservation Law Foundation John Kassel said, "Wind projects like the one in the package of contracts presented today are ready-to-go and are a critical element in both our fight against global warming and regional efforts to build a clean energy economy. Building thriving communities means working to address climate change and building a sound and stable economy; "going long" for wind, a step the legislature has smartly chosen to take and which the administration and utilities are now moving to make real, is a great way to do both."
"The New England Clean Energy Council was pleased to see Connecticut move quickly on long term contracting for Class I renewable energy projects since passing its significant energy bill this spring," said NECEC President Peter Rothstein. "This looks like a major step in the development of these vital new projects."
"Contracts for wind power are an important part of a diverse energy portfolio for the Northeast. They keep costs down and help avoid pollution and future rate increases because wind turbines need no fuel," said Tom Kiernan, CEO of the American Wind Energy Association. "We're doing our part to keep the national commitment to reduce carbon emissions and slow climate change that threatens us all."
Executive Director of the Connecticut Fund for the Environment Don Strait said, "This renewable procurement represents a major win for clean energy in Connecticut and the region. This procurement will provide cleaner generation for Connecticut residents at costs that are competitive with fossil fuel-based generation, which is a major breakthrough."
Comments from Project Leaders
"We thank Governor Malloy and the Connecticut legislature for their vision of a cleaner, cheaper, and more reliable energy future," said Gabriel Alonso, CEO EDP Renewables North America, which will be developing the Maine wind farm. "EDP Renewables is pleased to have been a winner in this very competitive solicitation, and looks forward to working with the state of Connecticut and providing affordable fixed price clean energy to Connecticut customers for the next 15 years."
"HelioSage is pleased to continue its role as a major participant in Connecticut's growing clean energy sector," said Danny Van Clief, Executive Vice President, Business Development, HelioSage Energy. "When completed, our project will stand among the largest solar projects east of the Mississippi and will deliver clean, renewable power to thousands of in-state energy users for years to come. This is an exciting day for Connecticut, and for everyone who wants to see solar become a meaningful component of our nation's energy mix."
Comments from Electric Distribution Companies
"We commend Governor Malloy and DEEP Commissioner Esty for their on-going dedication and effort to promote regional renewable energy projects as part of the state's Comprehensive Energy Strategy." said James Daly, Vice President of Energy supply for Northeast Utilities, parent company of CL&P. "These new agreements allow Connecticut Light and Power to further demonstrate our commitment to helping the state reach its goals by adding to the significant amount of renewable energy we currently deliver to our customers."
"It was exciting working with the procurement team at DEEP to help bring this opportunity to fruition for UI's customers," said Alan Trotta, Director of Wholesale Power Contracts at United Illuminating. "EDP Renewables and Heliosage have been a pleasure to work with, and we are looking forward to the long-term business relationships."
Background on the Selection of Projects and Connecticut's Renewable Portfolio Standard (RPS)
The two projects were selected after extensive analysis and ranking of 47 proposals submitted in response to a Request for Proposals (RFP) issued by DEEP on July 8. The RFP was released just weeks after the General Assembly approved and Governor Malloy signed into law Public Act 13-303, An Act Concerning Connecticut's Clean Energy Goals. This Act restructured Connecticut's Renewable Portfolio Standard (RPS), authorizing the state to go forward with this clean energy procurement process for up to four percent of Connecticut's total electricity load and recommitted Connecticut to obtaining 20% of its electric power from clean energy sources by the year 2020.
The two projects selected will provide 3.5 percent of Connecticut's total energy load, which represents almost one-fifth of the RPS goal (20% by 2020). The quick timeframe for the procurement process allows the projects to take advantage of federal tax credits for renewable energy projects that expire at the end of 2013, which is helping to reduce the cost of the power they will provide. The procurement team that reviewed the proposals consisted of members of DEEP's Bureau of Energy and Technology Policy, the Offices of the Consumer Counsel, and Connecticut's Attorney General.
Projects submitted in response to the RFP were scored and ranked in three categories, with the most significant being price. The other two categories were: viability, or the likelihood of achieving the proposed commercial operation date; and ability to improve reliability of the electric system in Connecticut, with considerations for contributions to improved transmission, local sourcing requirements, meeting peak demand and other technical requirements.
Next Steps in the Process
The power purchase agreements signed by both projects and the state's electric distribution companies will be submitted to the Public Utilities Regulatory Authority (PURA) for review and approval. Under provisions of Public Act 13-303, PURA has 30 days to act on the contracts. The projects will also be required to obtain all other necessary local and state approvals.
As the next step in broadening Connecticut's energy mix and achieving the state's RPS goals, DEEP anticipates moving forward this fall with an additional procurement under Public Act 13-303 that will focus on biomass projects that can meet state requirements.