The New York State Public Service Commission on Oct. 12 denied petitions filed by a group of offshore wind developers and a state renewable energy trade association seeking additional funding for four proposed offshore wind projects and 86 land-based renewable projects.
“In denying financial relief, the Commission opted to preserve the robust competitive bidding process that provides critically needed renewable energy resources to New York in the fairest and most cost-effective manner that protects consumers,” the PSC said.
“The requested amendments to the contracts would have provided adjustments outside of the competitive procurement process; such relief is fundamentally inconsistent with long-standing Commission policy,” said Commission Chair Rory Christian.
"The Commission has repeatedly stated that competition in the procurement process is necessary to protect ratepayers and provides the soundest approach to mobilize the industry to achieve our critical state goals dependably and cost-effectively, and we do so again through today's action,” he said.
The denied petitions were submitted by Empire Offshore Wind LLC and Beacon Wind LLC, Sunrise Wind LLC, and the Alliance for Clean Energy New York, Inc.
The petitions were seeking adjustment to Renewable Energy Credit and Offshore Wind REC purchase and sales agreements entered with NYSERDA to address recent inflationary pressures that are impacting project economics.
All three petitions requested an order from the Commission that would have directed NYSERDA to incorporate an adjustment mechanism into existing REC and OREC purchase and sales agreements to account for inflation and other economic impacts cited by the developers.
The petitions drew significant comments from stakeholders both supporting and opposing granting financial relief. Supporters pointed to the State’s clean energy goals and argued that relief is needed to stay on track toward achieving those goals.
Opponents generally expressed concern with the increase in prices that will be borne by ratepayers and the disruption of the competitive process that was used to award these projects.
The petitions generally stated that the effects of the COVID-19 pandemic have exposed the projects to unprecedented global and regional supply chain bottlenecks, high inflation, and increases in the cost of capital, driven by rising interest rates. Further, the petitions identified impacts associated with the war in Ukraine, including increased demand for renewable energy and resulting shortages and price increases for key components and equipment.
Petitions making similar requests as the offshore wind developers submitted by Clean Path New York LLC for the Clean Path New York project and by H.Q. Energy Services (U.S.) Inc. for the Champlain Hudson Power Express Project remain under review by the Commission.