Offshore wind energy legislation advances in Maryland

The Maryland House of Delegates on March 30 passed a bill with a vote of 88-47 that alters the state’s renewable energy portfolio standard (RPS) program to include a specified amount of offshore wind energy.

House Bill 441, which is sponsored by several lawmakers, including Maryland House Speaker Michael Busch at the request of Gov. Martin O’Malley’s administration, passed on third reading, according to the state General Assembly’s website.

According to the bill, starting in 2017, the RPS limits up to 2.5% the amount of of the state’s energy that can be derived from offshore wind energy each year.

The bill also said that applications may be submitted to the state Public Service Commission (PSC) for approval of proposed offshore wind projects.

An application is to include a detailed description and financial analysis of the offshore wind project; a cost-benefit analysis, including detailed information concerning assumed employment impacts in the state and an analysis of any impact on residential, commercial and industrial ratepayers over the project’s life; a proposed offshore wind renewable energy credit (OREC) pricing schedule for the project; and a decommissioning plan for the project.

The application is to also include a commitment that the applicant will pass along to ratepayers 80% of the value of any state or federal grants, rebates, tax credits, loan guarantees or other similar benefits received by the project and not included in the application.

The PSC is to evaluate proposed offshore wind projects based on, for instance, potential reductions in transmission congestion prices within Maryland; the extent to which an applicant’s plan provides for the use of skilled labor; and siting and project feasibility, the bill added.

Furthermore, the PSC may not approve a project unless the projected net rate impact for an average residential customer, based on annual consumption of 12,000 kWh, combined with the projected net rate impact of other qualified offshore wind projects, does not exceed $1.50 per month in 2012 dollars, over the duration of the proposed OREC pricing schedule.

The PSC may also not approve a project unless the projected net rate impact for all nonresidential customers considered as a blended average, combined with the projected net rate impact of other qualified offshore wind projects, does not exceed 1.5% of nonresidential customers’ total annual electric bills, over the duration of the proposed OREC pricing schedule.

Additionally, the price set in the proposed OREC price schedule is to not exceed $190 per MWh in 2012 dollars.

The bill also noted that within 60 days after the PSC approves a project application, the qualified project is to deposit $2m into the state offshore wind business development fund, which is to, for instance, encourage emerging businesses in the state, including minority-owned businesses, to participate in the emerging offshore wind industry.

Among other things, the bill said the PSC may not approve an application for a qualified submerged renewable energy line to be constructed or installed within the Assateague National Seashore Park or the Assateague State Park.

In a March 30 Environment Maryland statement, state Del. Tom Hucker, who is among the bill’s sponsors, said: “Let’s not get lapped by other states up and down the coast. It’s time for Maryland to press ahead with this amazingly abundant clean energy resource just off our shores. I hope the Senate will take our cue and quickly pass this critical legislation.”

The Senate Finance Committee had a hearing on its version of the bill, Senate Bill 237, in February.

Environment Maryland released a report recently, finding that offshore wind development would bring benefits to all regions of the state, according to the statement.

For instance, employment could increase on the Eastern Shore, and offshore wind, along with other measures, can help to maintain southern Maryland’s agricultural productivity. The group also said that offshore wind energy produces no solid waste, unlike electricity from coal burning, adding that for the capital region, this means that the Westland and Brandywine coal ash dumps could receive less toxic waste from coal plants.

About Corina Rivera-Linares 3208 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.