Millstone, offshore wind in zero-carbon auction mix

Dominion's Millstone Power Station is seen July 9, 2011, from the air. The plant is competing in Connecticut's new zero-carbon energy auction. (Sean D. Elliot/The Day)
Dominion's Millstone Power Station is seen July 9, 2011, from the air. The plant is competing in Connecticut's new zero-carbon energy auction. (Sean D. Elliot/The Day)

Millstone Power Station owner Dominion Energy and more than 100 other energy companies vying to deliver clean electricity to the state recently pitched their proposals to regulators, kicking off the state's much-debated zero-carbon auction that Millstone fought for years to join.

The Department of Energy and Environmental Protection paved the way for nuclear power to compete in the auction this summer, after fierce pushes from lawmakers and repeated warnings from Dominion that Millstone faced premature closure largely because the wholesale market is dominated by cheaper natural gas.

The auction also creates a second competition among offshore wind developers. Bay State Wind and Vineyard Wind, both joint efforts between wind companies and utilities, are taking another shot at supplying electricity to Connecticut after losing a renewable energy competition to Block Island Wind Farm developer Deepwater Wind earlier this year.

And Deepwater Wind offered two proposals in the zero-carbon auction as well, both on top of the 200 megawatts already approved by Connecticut earlier this year. Deepwater Wind, which has pledged to help revamp New London's State Pier into an offshore wind hub, offered to either expand its approved proposal by 100 megawatts or to construct a new 700-megawatt project in the same federal waters south of Martha's Vineyard.

Overall, DEEP received more than 100 submissions by Sept. 14 in response to its request for zero-carbon proposals, DEEP spokesman Chris Collibee said Tuesday. Many of the proposals are available for public viewing in the state's docket of energy filings. Because they remain under review by DEEP, the proposals redact many details, including pricing information.

Collibee said DEEP received proposals from "solar, onshore and offshore wind, hydropower and both nuclear facilities in New England that have not submitted a retirement bid," namely Millstone and Seabrook Station in New Hampshire, which injects electricity into the New England power grid.

"The agency will thoroughly review them over the next few weeks and months," Collibee said. "As this is an open RFP, it would be inappropriate to comment further."

After DEEP selects winning proposals, likely by the end of 2018, the winning energy producers will hammer out fixed-price contracts with the state's utility companies.

Millstone seeking to boost bid with at-risk status

Millstone spokesman Ken Holt said Dominion's proposal was "very competitive and will be extremely beneficial to Connecticut's electric customers."

"We are pleased with the bidding process and are grateful for the opportunity to submit bids for Millstone's carbon-free electricity," Holt said. "Compared to alternatives, customers will benefit from our bids between $670 million to $1.23 billion.  Additionally, if selected, any of our bids will help to preserve the 1,500 Connecticut jobs at Millstone."

Millstone's bids also may receive a boost over competitors if the Public Utilities Regulatory Authority agrees with Dominion that the plant is at risk of closure before 2022. Proposals from at-risk energy producers will be scored on environmental and grid benefits along with price; other producers' bids will be scored on price alone.

Millstone remains considerably profitable, according to public data, but Dominion says it filed confidential financial data with PURA to prove the plant could not survive without the zero-carbon auction. Analysis by state regulators showed a premature Millstone closure would lead to increased greenhouse gas emissions, heavy job losses and state and local economic impacts, and less reliability in the energy grid.

Millstone supplies the state with more than 2,000 megawatts of electricity. Millstone Unit 2's operating license with the U.S. Nuclear Regulatory Commission expires in 2035. Unit 3's expires in 2045. Unit 1 was decommissioned in 1998.

Seabrook Station, owned by NextEra Energy, is a 1,250-megawatt nuclear power plant licensed to operate until 2030. Alex Rubio, vice president of NextEra Energy, said in a letter to DEEP that the company was "committed to the flawless execution" of its proposal, which "represents an excellent value to the ratepayers."

Offshore wind competition heats up again

All the offshore wind proposals are for wind farms in federal waters south of Martha's Vineyard.

New Bedford-based Vineyard Wind — which Massachusetts picked to deliver offshore wind in the coming years — submitted a proposal to inject up to 800 megawatts into Connecticut. Vineyard Wind says its proposal could create 1,000 jobs and would redevelop Bridgeport into an "offshore wind construction port, which, alongside New London, will put Connecticut in the center of the emerging U.S. offshore wind industry for years to come," according to the proposal. Vineyard Wind is owned by Copenhagen Infrastructure Partners and Avangrid Renewables; Avangrid is United Illuminating's parent company.

Erich Stephens, chief development officer for Vineyard Wind, said the company is excited to bring "billions in economic benefits to the state with this proposal, and we are equally thrilled to be working with our partners in Bridgeport — McAllister Towing (which operates the Port Jefferson-Bridgeport Ferry) and Bridgeport and Port Jefferson Steamboat Company to transform the port into a world-class shipping operation."

The offshore wind proposal from Bay State Wind — a joint venture between Denmark-based Orsted and Eversource — would inject enough electricity to power 450,000 Connecticut homes, Orsted said Tuesday afternoon. Bay State Wind says its project would include a $25 million fund to spur growth in the local economy and to support skills training and environmental stewardship programs.

"Together, Orsted and Eversource's long-term operational history, extensive project management experience, and financial capabilities are brought to bear with Constitution Wind in helping Connecticut meet its renewable energy goals while spurring significant economic growth and job creation within the state," Orsted said in a statement.

b.kail@theday.com

Workers on the jack-up construction vessels Brave Tern and L/B Caitlin prepare to install the final blade on the the fourth of the five power generating wind turbines as part of the Deepwater Wind project three miles south of Block Island on Aug. 15, 2016. Deepwater is among wind energy producers competing in Connecticut's new zero-carbon energy auction. (Sean D. Elliot/The Day)
Workers on the jack-up construction vessels Brave Tern and L/B Caitlin prepare to install the final blade on the the fourth of the five power generating wind turbines as part of the Deepwater Wind project three miles south of Block Island on Aug. 15, 2016. Deepwater is among wind energy producers competing in Connecticut's new zero-carbon energy auction. (Sean D. Elliot/The Day)

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