Delmarva and Bloom admitted electric ratepayers would
be stuck paying above market prices for power. They said it would be
worth it because of claimed economic development benefit of jobs at a
new fuel cell factory, offsetting higher future electric prices for
conventional power, the avoided cost of buying renewable energy credits,
and environmental benefits. Two years down the road our predictions are
coming true:
· The cost will be at least three times expected and could go to a half billion dollars over the twenty year life of the project
· Overall
economic development potential will be one third expected and the
Delaware solar industry has been decimated by the offsets in Solar
Renewable Energy Credits
· Environmental
benefits would have been eight to ten times higher if a conventional
natural gas power plant had been built and electric rates would have
gone down instead of up
Delmarva Power submits monthly reports listing the
tariff payments, fuel cost, and operating cost of the fuel cell project
along with the offsetting revenue from the sale of the electricity. The
PSC, using company documents, estimated the comparable levelized above
market cost would be $3.30/month for a typical residential customer with
2013 being much lower. With only two thirds of the project complete in
October the estimated cost is now $3.83 and, based on the last 14 months
of data, we can extrapolate the cost when the project is complete will
total $4.50/month.
The $3.30/month cost was to be further offset by
$1.96/month through the avoided cost of buying renewable energy
credits. However, the price of the credits crashedand the offset will
only be $0.35/month. The net monthly cost will go from $1.34/month to
$4.15/month, three times higher, about what our worst case estimate
suggested. The total above market cost paid by ratepayers will go from
an estimated $142 million to at least $437 million and could go higher.
Mistakes in the economic development analysis also
overestimated economic development potential by a factor of three. If
Bloom actually hires 900 people, a big if, the jobs will cost half a
million dollars each in above market electric rates. Bloom is behind
schedule in hiring and the News Journal reported most of the license
plates on cars at the plant were out-of-state.
Environmental benefits were also exaggerated by
comparing air pollution savings only against coal fired generation. The
same $350 million investment made for fuel cells would have bought ten
times the generation capacity of a typical new conventional natural gas
generator leading to eight to ten times the air pollution savings. The
power cost would have been a third the cost of the fuel cell generation
and would actually have lowered electric rates.
The key question now is will future conventional
power price increases and higher renewable energy prices offset the
fuel cell tariff cost down the road. The US Energy Information Agency is
predicting fairly stable demand and slow growth in future electric
rates (one third the rate of increase used in tariff
documents). Renewable energy credit prices reflect the installed cost of
new wind and solar projects which have come down dramatically and are
expected to fall further. The prospect of either higher electric rates
or higher renewable energy credit prices going up enough to bail out
ratepayers from the high cost of fuel cell power is extremely low.
source: http://caesarrodney.org/index.cfm?ref=30200&ref2=407&utm_source=Dave-+As+CRI+Predicted%3B+Ratepayers+Ripped+Off+by+Bloom+Energy&utm_campaign=Bloom+Energy&utm_medium=email
No comments:
Post a Comment