Wednesday, December 11, 2013
HALLOWELL — Selected information about a controversial offshore wind energy proposal must be made public this month, state utility regulators decided Tuesday, but details such as how much the electricity would cost or the developers’ financial capacity aren’t likely to be disclosed.
A lobster boat passes a floating wind turbine off the coast of Castine in September. The University of Maine’s 9,000-pound prototype has been generating power since the summer.
The Associated Press/ Robert F. Bukaty
By a 2-1 vote, the Maine Public Utilities Commission ordered a partnership led by the University of Maine to release an edited version of its plan to build a demonstration floating wind farm off the Maine coast. PUC Chairman Tom Welch was joined by David Littell in supporting the release. Mark Vannoy opposed it.
Commissioners said the partnership should get the information to the PUC staff by the end of next week, and work to release information that’s not deemed confidential by the end of October.
Public interest in the venture has been high because offshore wind power has been identified by its supporters as an emerging industry that could have a broad impact on the state’s economy and energy future. The first step is to prove the technology with pilot projects.
In making its ruling, the PUC backed a recommendation by Tim Schneider, the state’s public advocate, that PUC proceedings should be as open and transparent as possible while protecting commercially sensitive information.
Schneider said Tuesday that the commission seemed to strike a good balance, but he played down broad expectations.
“I’d be surprised, and even concerned, if the redacted version included any information about proposed rates or specific terms of any proposed contract or term sheet,” Schneider said. “ We’re hoping the commission staff will be negotiating those terms in order to get the best possible deal for Maine ratepayers. Maintaining the confidentiality of those negotiations helps them do that.”
The public could get a fuller picture of the project after Nov. 15. That’s when the PUC staff wants to make public a redacted term sheet – an edited contract – for the project.
The project is being developed under the name Maine Aqua Ventus I, GP, LLC. It comprises a partnership of a for-profit arm of the University of Maine, Maine-based Cianbro Corp. and the parent company of Bangor Hydro Electric Co., Emera Inc. of Halifax, Nova Scotia.
GENERATING 12 MEGAWATTS
The partners launched a one-eighth-scale prototype of their project in May off Castine. At full scale, a $96 million project off Monhegan Island would generate 12 megawatts – 12 million watts.
On Sept. 1, Maine Aqua Ventus submitted a highly anticipated proposal for its full-scale project to the PUC. Among other things, the proposal estimates what consumers can expect to pay for energy generated by wind off the Maine coast – at least in its developmental stages.
But the partnership withheld the entire 100-page document from public view. It said that disclosing the information would hurt the project’s chances by tipping off competitors.
During the PUC’s deliberations, Welch acknowledged that it’s an “unusual situation” for the PUC, in that Maine Aqua Ventus already has disclosed information that is rarely made public during bidding procedures, such as the names of the business partners.
He endorsed the public advocate’s idea of releasing edited material that doesn’t jeopardize the project, but offered his opinion that “a significant majority” of the proposal may have to remain under wraps.
Littell spoke in favor of disclosure, and went further. He estimated that only 1 or 2 percent of the proposal might be considered a trade secret or performance specification. Any redaction should apply to certain words, not entire documents, he said. He accused Maine Aqua Ventus of revealing its business partners as a sword to gain credibility, while using the PUC’s confidentiality rules as a shield to protect it against other disclosures.
Vannoy disagreed with his colleagues. He noted that the request-for-proposal language allows applicants to designate what’s confidential, and said that changing the rules now tells future applicants that the PUC will bend to political pressure.
“This is a real test of whether we can maintain confidentiality,” he said.
After the commission’s deliberation, the university’s assistant counsel, Jeffrey Thaler, said he disagreed with the decision to require an edited version for public review. But Thaler said he expects that Maine Aqua Ventus will comply and work with the PUC staff.
On Monday, Thaler informed the PUC by letter that Maine Aqua Ventus had decided to launch a website containing non-confidential information about the project, partners and process.
Welch and Littell said the website idea doesn’t go far enough. Littell said it gives Maine Aqua Ventus a way to selectively release what it wants to public to see, not necessarily what the public or media is requesting.
Tuesday’s decision followed requests by environmental activists, influential Democrat legislators and the project’s Norwegian competitor, Statoil North America. For several weeks, they had been trying to pressure the university and its business partners to publicly disclose some details of its efforts to win a power contract for the demonstration project.
Beth Nagusky, Maine director for Environment Northeast, said the information should allow interested parties to evaluate the bid and compare the benefits it offers with Statoil’s proposal.
“We’re pleased with the PUC’s decision,” she said. “We feel Maine always makes better decisions when more information is available.”
Nagusky also recognized the balance between providing information and revealing business details to competitors.
“We hope they will release all the information that is not a legitimate trade secret,” she said. “We don’t want to do harm to the university’s proposal, but we do think the public has a legitimate interest in reviewing the contents.”
INITIAL PRICES ABOVE AVERAGE
Initial power prices from pilot wind energy projects will be well above average, but if the small-scale projects work out, developers hope to bring down the cost of electricity with large, floating wind farms connected to the regional grid. The goal is to achieve rates on par with conventional power plants after 2020.
But nothing will go forward in Maine without $46 million in federal energy grants that are set to be awarded in the spring. Maine Aqua Ventus is competing nationally with seven companies, including Statoil, for three awards from the Department of Energy for offshore wind projects.
Each developer needs a state-approved power purchase agreement to be in the running for the money. Statoil has one, for its 12-megawatt Hywind Maine wind park off Boothbay Harbor. The contract is for power well above market rates, but the PUC decided that impact would be mitigated by the economic benefits and long-term potential.
The PUC must decide before year’s end whether to grant a similar contract to Maine Aqua Ventus.
The decision hinges on the commission’s assessment of whether Maine Aqua Ventus has the technical and financial ability to carry out its proposal, among other things. That’s why interested parties are eager to learn more about the plan.
Also Tuesday, the commission sided with Statoil’s request to let its attorneys see the Maine Aqua Ventus proposal, under an agreement that the information wouldn’t be shared with anyone else. The vote was 2-1, with Vannoy opposing the release.
Officials at Statoil couldn’t be reached for comment late Tuesday.
Thaler said he also would discuss that ruling with the partnership, but said he might oppose it and file a motion with the commission for reconsideration.
Tux Turkel can be contact at 791-6462 or at: