Fallout continues from a recently released report by a Boston-based energy services company, the findings of which included a prediction that Connecticut ratepayers could face even higher electric bills.
The 61-page report produced by officials at Enel X said the wind and nuclear power procurement authorized by the Connecticut legislature over the past two years “transfers sigificant price risks to ratepayers.”
The wind power contracts Connecticut has agreed to are 20-year fixed power purchase agreements (PPA). And Enel X officials said that if revenues from the projects fall short of the PPA price, those costs would be recovered from consumers on their utility bills.
But according to a spokeswoman for the Connecticut Department of Energy and Environmental Protection, the conclusion drawn in the Enel X report is a faulty one.
Kristina Rozek said the fixed-price contracts were set through a competitive process and the wind power producers are “only paid for actual delivery of the energy and associated environmental attributes.”
“If the unit is not operational, ratepayers do not pay anything,” Rozek said. “The developer bears all development risk for the project, including but not limited to production risk, permitting costs, technology costs,”
Enel X officials did not respond to multiple inquiries by Hearst Connecticut Media seeking comment about the report.
Enel X’s report also said the nuclear power agreements Connecticut made at the end of 2018 are “structured as a contract for differences where Connecticut ratepayers will assume the risk, similar to offshore wind procurements.”
Rozek, said the risks associated with a guaranteed rate of return for power produced by Millstone must be weighed against threats that Dominion Energy had made to close the nuclear plant. Before reaching the procurement deal with the state, Dominion officials said they needed the long-term power contracts because Millstone no longer was competitive against low-priced natural gas-fueled electric generation plants in the region.
“The risk to ratepayers was that New England would see the shutdown of a facility that’s essential for the reliability of our electric grid and meeting our clean energy goals in the midst of a climate crisis,” Rozek said. “Connecticut entered into contracts to purchase the energy and environmental attributes to meet our goals as we have for many zero-carbon resources.”
But an Albany, N.Y.-based group representing large industrial energy users has also expressed concern to Connecticut officials about the nuclear contracts and their impact on energy prices in the state.
Amanda De Vito Trinsey, an attorney representing the group Connecticut Industrial Energy Consumers, told state utility regulators in a filing last year the organization “wholly disagrees ... (with the) claim that the (nuclear) contracts are just and reasonably priced prudent and cost effective.” The group’s members include the companies of United Technologies Corp.
Trinsey urged members of the Connecticut Public Utilities Regulatory Authority to require an earnings-sharing mechanism in the state’s contracts with Dominion Energy. Such a mechanism, she said, provides “minimum safeguards” for Connecticut ratepayers.