Delaware’s path to acquiring offshore wind energy along its coasts has taken a step forward.
Senate Bill 265, which outlines the process government agencies will go through when contracting offshore wind projects in the state, officially passed in the Delaware Senate on Thursday, with a few changes to the bill’s original text.
The bill has now been sent to the House of Representatives for consideration.
SB 265, or the Delaware Energy Solutions Act of 2024, was heralded by environmentalists as a major victory and a big step for the state in achieving its clean energy goals, but there are still opponents who have concerns on its economic feasibility and potential impact on tourism. .
The bill could also pave the way for other large-scale clean energy projects that rely on sources like solar energy.
BACKGROUND: New bill sets the stage for offshore wind projects in Delaware. Here’s what you need to know
What does the bill say?
The bill outlines an extensive process that offshore wind companies interested in investing in Delaware will have to undergo.
Essentially, this bill will amend three parts of the Delaware Code. These three sections would cover highways and roads (Title 17), public utilities (Title 26), and government agencies (Title 29). Under the bill, the Delaware Department of Transportation, the State Energy Office, the Renewable Energy Task Force and the Public Service Commission all have a say in the final approval of an offshore wind project.
A recruitment process to find a suitable wind project would begin with the State Energy Office issuing requests for proposals, after assessing whether market conditions are feasible for Delaware to participate.
The State Energy Office was originally limited to purchasing between 800 and 1,200 megawatts of energy for Delaware’s utilities. Senate Amendment 1 removed this minimum requirement, but left the maximum of 1,200 megawatts in place.
More: What to expect from offshore wind development in Delaware in 2024
More: Delaware’s beach cities offered payouts to support offshore wind projects. Will it work?
One of the most important parts of the bill has to do with the costs of wind energy. The bill states that the cost per megawatt may not exceed 110% of the “Delaware Benchmark Price,” which is essentially the average price that Delaware customers have paid for electricity over the past three years.
To qualify, requests must have a term of at least 20 years, remain below 110% of the Delaware Benchmark Price, and demonstrate economic and health benefits, avoided greenhouse gas emissions, energy bill impact, and regional impact. specify electricity grid.
The contract terms would be negotiated by the various government agencies based on the project’s potential costs and benefits, health benefits, avoided greenhouse gas emissions and more before the Public Service Commission issues their final order. Before a project can be built, however, the applicant must obtain appropriate permits from the Public Service Commission and DelDOT, which must approve applicants seeking to connect transmission lines through state highways.
This is where the language of the bill becomes broader. Renewable energy interconnection facilities, including transmission lines or other equipment to connect solar, wind or other renewable energy projects to the PJM transmission system, will be “encouraged as an integral part of Delaware’s state infrastructure.”
This means that large-scale renewable energy projects, and not just offshore wind, will be able to go through a similar process to get started.
“This bill is more than just about offshore wind energy,” Senator Hansen said during the hearing. “This bill provides major interconnection to renewable energy generation in our state. Whether that is wind, solar or something else.”
What changes have been made to the bill?
Two amendments were passed in addition to Senate Bill 265.
Senate Amendment 1 outlined eight changes to various details of the procurement process. In particular, it abolished the minimum energy consumption requirement of 800 megawatts and required the State Energy Office to ensure that ratepayers “never bear the costs of any project alone”, establishing further procedures to keep costs at a reasonable level hold.
Although utilities are not required to register to purchase offshore wind energy, Amendment 1 requires any municipal electric utility or rural electric cooperative that chooses to opt out of receiving offshore wind energy to submit a report stating describe its approach to contributing to the state’s CO2 reduction targets and explain why the entity has chosen not to participate in obtaining energy from offshore wind projects.
Senate Amendment 2 officially required, rather than merely suggested, the use of project labor agreements in applications for offshore wind projects.
Senate Bill 265 passed on May 23 on a 15-6 vote, across party lines.
Molly McVety covers community and environmental issues in Delaware. Contact her at mmcvety@delawareonline.com. Follow her on Twitter @mollymcvety.
This article originally appeared in Delaware News Journal: Delaware Senate passes offshore wind bill. What the bill does
