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November 15, 2024

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Incumbents Successful in Most Contested Governors’ Races

Democrats backing aggressive climate policies won or were leading in eight of 12 of the most contested gubernatorial races after voting Tuesday, with Nevada’s Steve Sisolak (D) the only incumbent on the ballot in danger of losing.

Democrat incumbents prevailed in Kansas, Maine, Michigan, New Mexico, New York and Wisconsin, while Democrats also won open seats in Massachusetts and Pennsylvania and were leading in Oregon.

Republican incumbents Gregg Abbott in Texas and Brian Kemp in Georgia also won new terms, while Republican Joe Lombardo, a Las Vegas-area sheriff endorsed by former president Donald Trump, led Sisolak by 50.6%-45.8% with more than three quarters of votes counted.

NEW ENGLAND: Climate-Focused Dems Take, Hold Governorships 

Democrats did well in New England on Tuesday, taking back the governor’s office in Massachusetts and holding on against serious challenges in Connecticut and Maine. 

Massachusetts Attorney General Maura Healey, who has been widely expected to be the next governor since she announced her run in January, followed through with a comfortable victory over Republican challenger Geoff Diehl. 

Healey made climate and energy policy a central plank of her campaign; it was the first policy plan she put out during the primary against progressive challenger Sonia Chang-Diaz. 

As AG, Healey is familiar with the work of ISO-NE and the region’s energy landscape. A team from her office is closely involved with the New England Power Pool and have sometimes butted heads with the grid operator over policy matters. 

In her campaign climate plan, Healey said she will “work closely with regional partners to ensure that ISO-NE markets for buying and selling power do not discriminate against clean power.” (See Healey Focuses on Climate in Mass. Gubernatorial Race.)

She also said that as governor, she would convene a “regional energy summit” to develop a strategy for addressing transmission, siting, market reform and cost allocation issues.

And the plan goes into much more detail about electrification in the transportation and building sectors, as well as environmental justice and equity. 

“Her climate plan meets the critical moment we’re in with the urgency it demands,” said the Environmental League of Massachusetts in a statement. “We’re confident that the Healey administration will make the Commonwealth a national climate leader.” 

Maine’s Gov. Janet Mills, who installed solar panels on the governor’s residence when she came into office in 2019 and has pushed for state investment in solar, EVs, offshore wind and more, held on against a challenge from former Republican Gov. Paul Lepage. 

One of the biggest issues she’ll have to weigh in on in 2023 is whether Maine should replace its for-profit utilities with consumer-owned, nonprofit utilities. Mills vetoed such a proposal following its passage by the state legislature in 2021 but said her opposition was more about process and specifics of the legislation. (See Maine Voters to Decide on Upending Utility Landscape in 2023.)

In Connecticut, Democratic Gov. Ned Lamont again prevailed in a rematch against his 2018 opponent, Bob Stefanowski. 

Lamont has what the Connecticut Mirror reports is a “robust record on climate change,” but also one largely enabled by the Biden administration and the federal government. 

Democrat Dan McKee, who took over as Rhode Island’s governor in March 2021, won a full term. 

Republicans John Sununu and Phil Scott easily won their races for governor in New Hampshire and Vermont, respectively. 

WEST: Democrats Maintain Control in Oregon

In the West, the future of state climate policy was most at risk in Oregon, where the Democratic former speaker of the state House, Tina Kotek, had been locked in a tight race with former Republican House leader Christine Drazan. But local media declared Kotek the winner Wednesday afternoon. 

Kotek, who hoped to continue Democrats’ 36-year hold on the governorship, led Drazan 46.2%-44.3% with more than two-thirds of votes counted. Independent Betsy Johnson, a former Democratic state representative, received 8.8%. Most of the uncounted ballots were in the Portland metro area, where Kotek had a strong lead.

A Drazan victory would have upended the decarbonization initiatives that current Gov. Kate Brown (D) implemented through Executive Order 20-04, which set caps on statewide greenhouse gas emissions with the goal of reducing GHGs to 80% below 1990 levels by 2050.

Drazan had promised to “tear up” Brown’s executive order on “Day One” of her term, and also replace the heads of every state agency, each of which has been enlisted in Oregon’s climate efforts. Citing high gasoline prices, Drazan last month additionally pledged to temporarily suspend Oregon’s Clean Fuels Program, which aims to reduce the carbon-intensity of transportation fuels sold in the state. She argued that the 2016 law establishing the program would allow her to do so.

Kotek, on the other hand, has been a leading supporter of climate change policy, having sponsored the legislation behind the Clean Fuels Program and led a Democratic effort to pass a cap-and-trade bill in 2019 (House Bill 2020). HB 2020 faltered after all 11 Republican members of the state Senate refused to show up to the state capitol, preventing the two-thirds quorum needed to vote on the bill.  Democratic support for the legislation subsequently weakened, and the bill stalled in committee, prompting Brown to issue EO 20-04 the following year. 

In a related development, Oregon voters on Tuesday overwhelmingly approved a ballot measure that would prevent state legislators from seeking reelection if they have more than 10 “unexcused” absences during a session, a development that could improve the ability to pass future climate legislation.

California Voters Reject EV Ballot Initiative 

In California, Democratic Gov. Gavin Newsom, who last year easily survived a $300 million recall effort, handily won a second term to lead the nation’s largest state, taking about 58% of the vote. During his first term, Newsom aggressively pushed for California to ramp up its climate goals, and he has worked closely with other leaders on the West Coast to align their decarbonization efforts. 

California voters on Tuesday firmly rejected a ballot initiative (Proposition 30) to levy a 1.75% personal income tax on households earning more than $2 million a year to raise $5 billion annually to fund electric vehicle rebates and the installation of EV chargers in public places and at residences. Newsom broke with his party to oppose the measure, saying the state had already committed billions to EV incentives from its budget surpluses.

Arizona Race Too Close to Call

Arizona’s gubernatorial race between Secretary of State Katie Hobbs (D) and former television news anchor Kari Lake was neck-and-neck, with Hobbs leading 50.1%-49.9% with two-thirds of the votes counted. 

On the campaign trail, Hobbs has talked about Arizona building “a 21st century clean economy” to address the impact of climate change. She has specifically pledged “to leverage state and federal resources to modernize our energy and transportation sectors;” electrify school buses and state vehicle fleets; provide rural and tribal communities with greater access to sustainable energy; and push for a $200 tax credit for home energy efficiency improvements.

Lake has said that her policies would focus on energy reliability, and while she’s “not opposed to some of the green energy,” she prefers “good old-fashioned clean energy, which is nuclear.” She has stated that she wants Arizona to become an energy exporting “powerhouse” by building modular nuclear reactors that could sell electricity to California, which is subject to brownouts because of its “asinine” policies.

Nevada Incumbents Trailing

Incumbent Democrats were faring worse in Nevada, where Sisolak and U.S. Sen. Catherine Cortez Masto were trailing their Republican opponents Wednesday afternoon, with many mail-in ballots still to be counted. Sisolak was a strong backer of Senate Bill 448, which the Nevada Senate unanimously passed last year to spur major investments in renewable energy transmission, EV charging infrastructure and energy efficiency programs. The law also requires Nevada’s utilities to join an RTO by 2030.

New Mexico Gov. Re-elected

Gov. Michelle Lujan Grisham (D) won re-election in New Mexico with 52% of the vote, outpacing challenger Mark Ronchetti’s (R) 46%.

“The weather forecast for New Mexico is four more years of progress — four more years of rebuilding our beloved state,” Lujan Grisham said in a jab at Ronchetti, a former television weatherman.

The state’s wind and solar resources have increased while coal generation has slowed since the 2019 passage of the Energy Transition Act, which requires the state to get all of its power from zero-carbon resources by 2045. Public Service Company of New Mexico shut down its coal-fired San Juan Generating Station in September in response to the legislation.

Lujan Grisham’s spokesperson has said the governor will focus her second term on policies that diversify the state’s economy and expand renewable energy.

Jeff Byrd (R), who stepped down from the New Mexico Public Regulation Commission to run for land commissioner, came up far short in his bid. He lost to Democrat Stephanie Garcia Richard by a 55-45 margin.

MIDWEST: Clean Energy Goals Undisturbed 

Three Democratic incumbents who established clean energy objectives for their states won second terms in Wisconsin, Michigan and Minnesota, leaving decarbonization goals unscathed in the Upper Midwest.

All three incumbents faced Republican challengers who either had ties to the fossil fuel industry or campaigned on prolonging fossil fuel infrastructure.

In late night and early morning victory speeches, the gubernatorial trio promised more work on clean energy adoption or tackling the causes of climate change.  

Wisconsin Governor Tony Evers (D), who signed an executive order in 2019 targeting 100% carbon-free electricity in the state by 2050, bested Republican Tim Michels. Michels, co-owner of energy and infrastructure construction company Michels Corp. — which has worked on facilities for the Dakota Access and Keystone XL pipelines and relocation of Enbridge Energy’s Line 5 pipeline in the Great Lakes — said he would divest from his company if elected.

“You showed up for conservation, for clean energy, to take climate change seriously and a future that doesn’t treat protecting our environment and good-paying jobs like they’re mutually exclusive. Because they’re not,” Evers told a crowd in an acceptance speech early Wednesday.

Gretchen Whitmer (City of Detroit) FI.jpgMichigan Gov. Gretchen Whitmer | City of Detroit

Michigan Gov. Gretchen Whitmer (D) defeated Republican challenger and Donald Trump pick Tudor Dixon, who vowed to protect the Line 5 project and advocated an “all-of-the-above” strategy for energy production, including reliance on existing coal plants.

Last year, Whitmer introduced the MI Healthy Climate Plan, which calls for economy-wide carbon neutrality in the state by 2050.

In debates, Whitmer and Dixon clashed over the state’s future in electric vehicle manufacturing and whether environmental regulations jeopardize economic progress.

Whitmer vowed in a victory speech that Michigan will “hit the ground running” over her second term, including ramping up the state’s clean energy production.  

The Michigan League of Conservation Voters cheered Whitmer’s win on Twitter, saying it was ready to “drive Michigan into a clean energy future” alongside Whitmer.

Finally, Minnesota Gov. Tim Walz (D) overcame a challenge from Republican candidate Scott Jensen, a physician and former state senator. Jensen had campaigned on voiding the state’s clean car rules, overturning a moratorium on nuclear power, and keeping retiring coal plants online longer, including Xcel’s Sherburne County Generating Station, which is due to be replaced in part by solar generation upon its closure in 2030.

Walz thanked campaigners and voters for believing that issues like climate change can be tackled in “an optimistic way that lets us lead the country.”

“Minnesotans have made it very clear. They chose the hopeful future of one Minnesota where we invest in our children, where we defend the rights of individuals, where we address climate change, where we make our communities stronger and where we welcome those seeking the comfort of Minnesota,” Walz said.

Walz in 2019 announced that Minnesota was not on track to shrink emissions 30% from 2005 levels by 2025 and 80% by 2050 per the state’s 2007 law. He issued an executive order to create the Climate Change Subcabinet and the Governor’s Advisory Council on Climate Change to devise strategies to fulfill the reductions targets.

MARYLAND: Moore Pushes State to Go Faster, Bolder on Clean Energy

Maryland’s first and at present the nation’s only African American governor-elect, Wes Moore (D) ran on an aggressive clean energy platform, patterned on President Biden’s ambitious targets and all-of-government approach.

S.B. 528, which became law in April without Republican Gov. Larry Hogan’s signature, has already put the state a path to cut greenhouse gas emissions 60% below 2006 levels by 2031 and to go net-zero economywide by 2045.

Wes Moore(Amunankhra House Ltd) Content.jpgMaryland Gov.-elect Wes Moore | Amunankhra House Ltd.

But calling on Marylanders to go faster, be bolder and not wait for their turn, Moore wants to up the ante, with a 2030 deadline for the 60% emissions reduction. Moore also wants the state running on 100% clean energy by 2035, “by leveraging billions of incoming federal funds and growing solar installations, supercharging Maryland’s wind industry, and investing in battery storage research and development within our university systems.”

He calls for an “entire-government” approach in which all state government agencies will review of their procurement and energy efficiency standards and their vehicle fleets, with the goal of setting “clear annual benchmarks that will reduce their environmental impact and that of the state.” He also wants the state’s vehicle fleet electrified by 2030.

Like Biden, Moore sees the green economy as creating jobs and promoting equity, especially for low-income families, and he intends to appoint a chief sustainability, mitigation and resilience officer to oversee and coordinate the state’s clean energy and climate initiatives.  

But, even with plenty of federal funds from the Inflation Reduction Act and solid Democratic majorities in both the Maryland House of Delegates and Senate, Moore’s plan could face obstacles. Exelon, which owns the state’s two main utilities, Pepco and Baltimore Gas and Electric, has a 2050 target for net-zero emissions. According to the U.S. Energy Information Administration, as of July, coal and natural gas were still providing close to two-thirds of the state’s electricity.

Successive efforts to pass a green building code in the state have been watered down or derailed by the local building industry.

For example, S.B. 528 originally contained provisions requiring that from 2023 to 2033, at least one new school in each school district be built to net-zero standards, but the provisions were cut from the final version.

The bill’s broader requirements on building performance standards were another casualty. They would have mandated that new or renovation projects built with at least 25% state funding meet high-performance building standards developed by the Maryland Green Building Council. Emission-reduction targets for large commercial buildings and multifamily dwellings were also cut, from 50% to 20% in 2030, and a net-zero target for 2035 was eliminated.

A U.S. Army vet and nonprofit executive, Moore has no previous experience in government. On the plus side, he will come into office backed up with a slate of experienced Democratic government officials, including U.S. Rep. Anthony Brown as attorney general and state Del. Brooke Lierman as comptroller.

NEW YORK: Voters Approve $4.2B Environmental Bond

New York state voters approved $4.2 billion in environmental and climate protection spending by a huge margin Tuesday but retained the governor leading the climate effort by a much closer vote.

The Clean Water, Clean Air, and Green Jobs Environmental Bond Act of 2022 promises extensive capital improvements in coming years, with up to $1.5 billion of the funds designated for climate change mitigation.

Kathy-Hochul-(Darren-McGee-Office-of-Governor)-FI.jpgNew York Gov. Kathy Hochul | Darren McGee, Office of Governor

Specific spending includes $400 million for green building projects at state-owned facilities and public schools; $200 million for reduction of air and water pollution affecting environmental justice communities; and $500 million for purchase of zero-emission school buses and supporting infrastructure.

As of midday Wednesday, unofficial results showed voters supporting the environmental bond on 59% of ballots cast and opposing it on 29%, a ratio slightly better than 2-to-1. (No vote was cast on the other 12% of ballots, some undoubtedly because the proposition was on the back of the ballot and went unseen.)

By contrast, Democrat Kathy Hochul collected 52.2% of votes for governor to Republican Lee Zeldin’s 47%.

As of Nov. 1, Democrats outnumbered Republicans among registered voters 49.6% to 22.1%.

Hochul’s predecessor, Andrew Cuomo, was a forceful advocate of efforts to slow climate change, and Hochul continued support for one of the nation’s most aggressive decarbonization programs after she took over as governor in mid-2021.

But the transformative (and expensive) climate initiatives never became a major Democrat-vs.-Republican theme during the 2022 campaign season in New York. And the bond act was approved by a margin wider than that enjoyed by almost every winning candidate for state office.

With both chambers of the legislature retaining a Democratic majority if not supermajority going into 2023, the state appears on track to continue with what Hochul likes to call its “nation-leading climate agenda.”

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Clean Energy Industry Braces for Oversight Hearings as GOP Nears Control of the House

With what is shaping up as a thin majority in the House of Representatives, Republicans may not be able to repeal the Inflation Reduction Act, but they will be able to hold oversight hearings and grill Biden administration officials on any perceived missteps or failures in the law’s implementation, industry analysts said Wednesday.

With the IRA’s $369 billion in clean energy tax credits, incentives and other funding to be distributed, the question is not if, but when such hearings will come, said Abigail Ross Hopper, CEO of the Solar Energy Industries Association, speaking at a post-election webinar sponsored by the Policy Resolution Group at Bracewell LLP.

The industry trade group has “been talking a lot … about ensuring that the processes we go through, the way the monies and tax credits and eligibility [are] defined and applied is transparent and fair and in line with the intent of Congress,” Hopper said. “So, when there are oversight committee hearings, the solar industry or the storage industry, the clean energy industry will be managing those in an appropriate way.”

What the election outcomes might augur for the U.S. clean energy transition, President Biden’s domestic agenda and the political landscape in general were top of mind for Hopper and the lineup of industry analysts and experts speaking at the webinar.

As of Wednesday evening, Republicans had a solid 207 seats in the House versus 189 for the Democrats, according to The New York Times, while the Senate was split 48 to 48. Republicans need 218 seats for control of the House.

Key Senate races in Arizona, Georgia and Nevada are still undecided, but Democrats were hopeful of holding onto the majority there.

Republicans will claim a 49th seat in Alaska, where incumbent Republican Lisa Murkowski was trailing Republican Kelly Tshibaka 44%-43% with three-quarters of the votes counted. Democrat Pat Chesbro was out of the running at 10%.

In Arizona, incumbent Democrat Mark Kelly led Republican Blake Masters 51%-47% with two-thirds of the votes counted. In Nevada, Democratic incumbent Catherine Cortez Masto was trailing Republican Adam Laxalt 50%-47% with 77% of votes in. Both Democrats currently serve on the Energy and Natural Resources Committee.

The Georgia race between incumbent Raphael Warnock (D) and Republican Herschel Walker is headed to a runoff after neither candidate cleared 50%.

President Biden 2022-11-09 (C-SPAN) FI.jpgPresident Biden said the election results were “a good day … for democracy.” | C-SPAN

Speaking at the White House Wednesday afternoon, Biden called the election a “victory for democracy,” citing the record number of young voters who participated to voice their concerns about reproductive rights and the climate crisis. While acknowledging that every Democratic loss is painful, he said in general, Democrats still made a strong showing, in Congress and in governor’s races.  

He also acknowledged the frustrations of many voters but said Americans would be seeing the positive impacts of laws like the Infrastructure Investment and Jobs Act and the Inflation Reduction Act in the early months of next year.

The failure of an expected “red wave” of voters to sweep strong Republican majorities into both houses of Congress — and losses for some GOP candidates backed by former President Donald Trump — provided relief for the Democrats and energy policy, said Scott Segal, partner and co-head at the Policy Resolution Group.

“I want people to understand that simply because we will have or we are likely to have divided government with one house at least being Republican controlled, does not mean that we should put all considerations of energy issues on the back shelf,” Segal said.

“Energy issues often have a regional component to them that is over and above the mere partisan politics,” he said. “There is a long and proud tradition of energy and environmental statutes being adopted by a divided government because of the relative balance and leverage that occurs between the entities. … Removing obstacles to energy development, [which] both parties tend to desire, is something that could be the basis of bipartisan advancement.”

The Specter of Solyndra 

But the fate of the IRA, and the likelihood of oversight hearings inevitably raises the specter of Solyndra, Segal said. The solar startup, known for its unique tubular technology, received $535 million in federal loans in 2009 and went bankrupt two years later, triggering a series of congressional oversight hearings, which some congressional Republicans continue to evoke to this day.

Hopper acknowledged the risk but said, “Our industry is much more mature, and the technology is more mature; the financing structures are more mature. That sort of broad base of customer support and business demand for our products is greater,” she said.

Still, Hopper said, the best antidote for risk is “transparent, objective criteria for grantmaking, for eligibility requirements.” The immediate challenge for the Biden administration is to get out the rules and guidelines for the IRA’s billions in clean energy tax credits and incentives, she said.

“The best thing we can do … to ensure the continuation of the IRA is to have projects on the ground, jobs being created, tax revenue happening, local politicians seeing evidence of growth in their local communities” she said. “We can’t do that until we know the rules of the road, and so we need this administration to do that.”

On the industry side, Hopper said, SEIA is ramping up its consumer protection initiatives to ensure homeowners understand the law’s tax credits for residential solar.

“We’re putting that on steroids,” she said. “We want to make sure that as money and opportunity [are] flowing, that consumers are going in with eyes wide open. These are great opportunities for homeowners to make choices about their energy use, but they need to be informed choices.”

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SPP Briefs: Week of Nov. 7, 2022

Markets+ to Offer Transitional Real-time Market in 2024

SPP said Monday that it will implement major components of the governance structure of its planned Markets+ service next year and also explore launching in 2024 a transitional real-time balancing market, similar to its Western Energy Imbalance Service (WEIS) market.

The RTO said that by establishing its Markets+ governance framework in 2023, it will ensure stakeholders have a formal structure that enables “robust” input and provides independent oversight of market development and implementation.

Markets+ stakeholders will gather in Westminster, Colo., next week to review the final draft of the service offering. That will serve as the basis for the Markets+ tariff and guide the real-time service offering’s development, which has a targeted go-live date of June 2024. The day-ahead component will be developed at the same time and launched as soon as possible.

SPP CEO Barbara Sugg said that standing up the Markets+ governance framework quickly will let “stakeholders collaborate to build a strong foundation for a market that meets the needs of the West.”

The RTO plans to create a Markets+ seams working group to facilitate transfers between its participants, CAISO and other Western utilities.

SPP began administering the WEIS market on a contract basis in February 2021, centrally dispatching energy from participating resources every five minutes. Market participants do not need to be members of the RTO.

The grid operator also said Powerex has indicated it will fully participate in funding development of Markets+ and join the market when it goes live. Powerex, Canadian utility BC Hydro’s marketing and trading subsidiary, said the market’s inclusive and independent governance framework, supported by a neutral market operator and independent board of directors, was the primary reason behind its decision.

Powerex is one of 11 Western entities that have declared their intent to participate in the next phase of Markets+ development. (See 4 Arizona Entities Commit to Developing SPP’s Markets+.)

Meteorologist: ‘Crazy Weather’ this Winter

The SPP footprint can expect colder than normal conditions across the Northern Plains this winter but milder conditions to the south, a meteorologist told SPP staff and market participants Wednesday.

As if to illustrate the point, James Bryant, a meteorologist for KATV in Little Rock, Ark., was speaking as a winter storm bore down on North Dakota with blizzard conditions that could drop as much as a foot of snow on the state and with wind gusts as strong as 55 miles per hour.

“I expect quite a bit of crazy weather over the course of the next three months. This is kind of our busiest season, and you guys know that all too well,” Bryant said during SPP’s annual winter preparedness workshop.

Bryant said this winter will be a triple-dip La Niña — the third straight year of La Niña conditions, which will result in highly variable weather if history is any indication. He said triple-dips in 1956, 1975 and 2000 all had high month-to-month variability.

“You can get some extremes on both ends of the spectrum,” he said. Bryant cautioned his audience not to expect a repeat of the February 2021 winter storm, which he called a “once-in-a-generation kind of thing.”

Staff said SPP has about 17 GW of excess capacity to meet its highest demand expectations. They included data from last year’s winter storm to make their modeling as realistic as possible and reviewed the operational and communications changes they have made since the storm.

Attendees also heard from the Natural Gas Supply Association’s David Attwood, who said winter gas production is 4% higher than last year at 104 billion cubic feet/day.

Summer SOM Report Released

SPP’s Marketing Monitoring Unit quarterly state of the market report for this summer found the average hourly load was 6% above summer 2021, driven primarily by increased temperatures. Load was up during June, July and August.

Day-ahead prices were up 124% to $74.63/MWh this summer, from $33.30/MWh last summer. Real-time prices also jumped to $69.65/MWh this year, a 127% increase from $30.68/MWh last year.

Gas prices hit a new all-time high for the Integrated Marketplace when they spiked to $8.03/MMBtu in August. Gas prices have only been higher during the February 2021 winter storm. Average gas prices at the Panhandle Eastern hub were $7.31/MMBtu during the summer.

The quarterly report includes in its special issues section an initial review of the recently implemented ramp capability product.

The Monitor will host a webinar to discuss the summer report at 10 a.m. on Nov. 11.

SPP’s Monitor has also posted a pair of white papers on virtual activity during last year’s winter storm and transmission congestion rights funding in SPP.

The virtual activity report highlights shifts in virtual behavior and presents an analysis of market re-runs designed to assess the effect virtual positions had on price convergence, total production cost and total market convergence.

The TCR funding report explains the drivers behind their funding in both theory and practice and explores the potential implications of underfunding on asset prices and participant behavior.

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NERC Still Considering Scaling Back Board Meetings

NERC’s Board of Trustees is pondering significant changes to its calendar, with one of the four annual open meetings moving to a hybrid format and another moving fully online, the organization’s Corporate Governance and Human Resources Committee (CGHRC) heard at its open meeting on Monday.

The potential new schedule was among the topics discussed at NERC’s recent board retreat held Sept. 26 and 27, CGHRC Chair Suzanne Keenan told members on Monday’s conference call. The theme of the retreat was “Building a more effective and efficient governance process,” and topics were developed based on interviews between trustees and an outside consulting firm.

During their retreat, board members focused on enhancing engagement with stakeholders, improving efficiency and increasing agility in governance. Optimizing meeting frequency, in part through making better use of technology, was identified as one way to work toward these goals.

Under the suggested board calendar that Keenan discussed Monday, the board and Member Representatives Committee (MRC) would have two full, in-person meetings per year: one in February in a “Western or Southern location,” and one in August in Canada. The February meeting would include a stakeholder dinner to enhance engagement.

The other two meetings would have some form of virtual attendance. Trustees and MRC members would gather in person at NERC’s Washington office in May, with other stakeholders participating virtually. The final meeting of the year would be entirely online — and moved to early December from its current position of mid-November — with an attempt to limit the agenda to “necessary board governance actions only.” This idea is aimed at reducing the cost of travel during the busy holiday season and could extend as far as eliminating the MRC’s meeting entirely.

“We know from stakeholders that this time of year is crushed. Our objective will be to narrow the board meeting down to only the governance actions that we need to take,” Keenan said. “Clearly we recognize there are governance actions that the MRC needs to take, and NERC will be happy to provide the logistical support for a virtual meeting unless the MRC can move its governance actions to August or February to obviate the need for an end of year MRC meeting.”

Changes may also be coming for the board’s governance committees: the CGHRC, the Finance and Audit Committee, the Technology and Security Committee, and the Compliance Committee.

For these committees, Keenan told listeners that the board has gradually and “through good intentions … become a committee of the whole,” with all trustees routinely attending every board committee’s meeting, not just those to which they belong. While this trend reflects the trustees’ dedication to following all of NERC’s actions, it has meant that meetings tend to slow down while all trustees are commenting.

The board hopes to change this starting in February by limiting trustee attendance only to those meetings of which they are members, with the exception of first-year board members who are trying to build familiarity with NERC’s governance processes.

Keenan said the board hopes this approach will lead to “freeing up more time for engagement and informal discussion in the hallways.” To compensate for trustees’ inability to attend in person, NERC will expect committee chairs to be “more comprehensive” in their reports, and meeting notes will be available to all trustees.

Monday’s discussion shows that NERC’s board is still committed to streamlining its meeting schedule and continuing some of the changes that were initially introduced in response to the COVID-19 pandemic, even after most organizations lift the travel restrictions that led the board to adopt a fully virtual stance in 2020. Such ideas go back at least as far as January 2021, when NERC CEO Jim Robb floated a hybrid meeting framework in which the February and August meetings would be fully in-person, while the other two would have some form of virtual attendance. (See NERC Considering Long-term Virtual Board Meeting Format.)

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NYISO Stakeholders Propose Three Areas for Public Policy Transmission

NYISO stakeholders urged transmission upgrades upstate, downstate and along the Pennsylvania border during the ISO’s 60-day comment period for its 2022-2023 Public Policy Transmission Planning Process.

NYISO submitted 17 sets of recommendations to the state Public Service Commission on Nov. 7 (22-02192/22-E-0633). The filing triggers a review by the PSC, which will identify the public policy transmission needs (PPTN) it wants the ISO to pursue.

The Alliance for Clean Energy New York and the New York Offshore Wind Alliance identified three geographic areas flagged by the ISO in its 2021-2040 System & Resource Outlook as potential constraints: downstate because of the amount of planned offshore wind generation; the Pennsylvania border region; and the state’s North Country, where the existing network is expected to limit the availability of renewable energy resources. (See NYISO 20-Year Forecast Highlights Generation, Tx Hurdles to Climate Goals.)

Offshore Wind

The ISO is currently reviewing proposals it received in response to the PSC’s March 2019 declaration of a need for transmission to ensure the output of offshore wind facilities interconnected with Long Island are deliverable to the rest of the state (Case 20-E-0497).

The PSC’s order directed the ISO to add at least one bulk transmission intertie cable to increase the export capability of the Long Island Power Authority (LIPA)-Con Edison interface that connects Zone K (Long Island) to Zones I (Westchester) and J (New York City) to ensure at least 3,000 MW of offshore wind is deliverable from Long Island to the rest of the state. The PSC also ordered upgrades to associated local transmission facilities to accommodate offshore export capability.

Several stakeholders, including PSEG Long Island (NYSE:PEG), said the current Long Island PPTN may not be sufficient for future offshore wind projects.

National Grid Ventures (NYSE:NGG) said the state should provide for transmission of at least 20 GW of offshore wind by 2050, as contemplated in the Climate Action Council’s Draft Scoping Plan. At present, state law mandates only 9 GW of offshore wind by 2035.

Con Edison Transmission (NYSE:ED) made a case for a single coordinated transmission infrastructure for the multiple projects to be built off the New York coast, citing the risk, limitations and expense of siting multiple radial lines. Con Edison has proposed such a solution, the Brooklyn Clean Energy Hub, and repeatedly pointed that out in its comment letter to NYISO. Other developers have identified possibilities similar to the Brooklyn hub concept. (See Stakeholders Question Feasibility, Costs of Con Ed OSW Substation.)

Ørsted (OTC: DNNGY), which has been awarded 1,060 MW of wind projects off the New York coast, urged that proposals for transmission of offshore wind be evaluated for flexibility for future expansion and resilience to extreme weather.

Other Needs

Avangrid Networks (NYSE:AGR) said its analysis showed the planned upgrades of the bulk transmission system may not be sufficient in two ways: pathways for carrying power from upstate to downstate and transfer capacity between load zones in upstate.

The Climate & Environmental Justice Office of New York City flagged the need for additional transmission capacity into the city and the need to plan it soon, given that such projects can take a decade or more to build.

HQ Energy Services U.S. urged that a public policy need be identified for dispatchable, emission-free resources. The company is a subsidiary of Hydro-Quebec, which could sell hydropower in New York state via new transmission projects, or — if New York state should ever develop a surplus of clean energy — reverse the current and store that excess power in its network of reservoirs.

Invenergy recommended significant transmission investment in the Southern Tier — the Pennsylvania border region — where there is significant potential for wind and solar power development but where NYISO identified significant transmission constraints.

New York Transco, which is owned by subsidiaries of National Grid, Con Edison, Avangrid and CH Energy Group, urged improvements to eliminate constraints in the three regions flagged by NYISO. It also suggested improvements in western New York at the Dysinger East and West Central interfaces.

The New York Power Authority flagged a need to modernize the existing transmission system in the Albany region, to increase flexibility and transmission capability between upstate and downstate.

Rise Light & Power said the Champlain Hudson Power Express and Clean Path NY transmission projects may not meet the needs for additional power in New York City, and a solicitation should be issued for an additional line from upstate New York to New York City.

Transource Energy and Transource New York urged the PSC to direct NYISO to include advanced transmission technologies in its viability and sufficiency assessment of proposed solutions. It made a pitch for Breakthrough Overhead Line Design, which was developed by Transource parent American Electric Power (Nasdaq: AEP). Transource said BOLD offers “reduced inductance and impedance [and] increased transfer capability.”

2019 Order

In its 2019 order directing the ISO to pursue upgrades for Long Island’s offshore wind, the PSC declined to endorse any other PPTNs, saying further consideration of the Power Grid Study by PSC staff and the New York State Energy Research and Development Authority was needed first.

The staff’s “Initial Report on the New York Power Grid Study” in January 2021 found that a new 345-kV tie-line across the Long Island to New York City interface could provide benefits, including reduced OSW curtailments.

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Lordstown Motors Gives 2 Board Seats to Foxconn

Lordstown Motors (NASDAQ:RIDE) reported third-quarter losses Tuesday, just a day after announcing it had secured $170 million in new funding from Taiwanese electronics manufacturer Foxconn.

In exchange for the cash, the contract manufacturer, which is the largest maker of iPhones for Apple, purchased additional shares of Lordstown common stock, shares of newly created preferred stock and won two seats on the electric truck maker’s board of directors.

The earnings report showed a cash balance and short-term investments of $204 million, which Lordstown attributed to “strong spending discipline.”

Operating loss over the quarter amounted to $154.8 million, a figure that largely consisted of accounting losses.

Additionally, the report revealed that Lordstown and Foxconn have agreed to produce another electric vehicle in the future at a sprawling former General Motors assembly plant in Northeast Ohio, though no details of that venture were revealed.

Lordstown said it has produced just 12 of the first batch of 500 Endurance trucks it has committed to manufacture at the plant, now owned by Foxconn. The plan is to complete the rest of the batch in the first half of next year, the company said in a release accompanying its report. The Endurance has not yet been federally certified to meet safety standards, though the truck has met collision standards in crash tests.

“We are proud of the accomplishments of the Lordstown and Foxconn EV technology teams in bringing the Endurance into commercial production,” Lordstown CEO Edward Hightower said. “While we have more work to do, our entire team cannot wait to get the vehicle in the hands of our customers. We are also extremely excited by the additional investment and expanding relationship with Foxconn and the opportunities it provides beyond our first vehicle.”

Lordstown also said that it is open to additional original equipment manufacturer partners to accelerate production of the Endurance.

“As one of the very few full-size, all-electric pickup trucks in the market, the Endurance offers other OEMs the opportunity to enter the market quickly and at relatively low cost,” the company said.

Foxconn is also planning to build an electric tractor and a small electric car for other companies at the Ohio plant.

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Move-in Date Approaches for Calif. Microgrid Community

Residents will soon be moving into a new microgrid community of 219 single-family homes in Southern California — a project that’s being called first of its kind in the state.

SunPower worked with KB Home and other partners on the project, which was awarded a $6.65 million Connected Communities grant from the U.S. Department of Energy last year.

The 219 homes will be built in two neighboring KB Home subdivisions, Oak Shade and Durango, in the Riverside County city of Menifee, about 80 miles east of Los Angeles.

Each of the all-electric homes will be solar powered and have individual battery storage. In addition, they’ll be connected to a microgrid powered by a large, shared community battery.

“This project may be the blueprint to follow for building new decarbonized homes of the future,” DOE said in announcing the award.

How It Will Work

Each home will receive electric utility service from Southern California Edison (SCE), which is a partner in the project. The homes will also come with controls that can isolate them from the grid during a power outage.

During an outage, the homes will draw energy from their own battery systems or from the community battery. The systems are designed to support critical loads including lights, refrigeration and Wi-Fi, as well as high-capacity loads such as hot water and space heating and cooling. SunPower called the homes “power-outage resistant.”

The project will be a “true microgrid,” in which the all-electric homes can be disconnected and reconnected to the grid, a SCE spokesperson told NetZero Insider. SCE checked with other major utilities to confirm the project’s uniqueness in California, the spokesperson said.

The Durango and Oak Shade subdivisions will have separate microgrids that can be connected when it benefits both communities, according to the Advanced Power and Energy Program (APEP) at the University of California, Irvine, another project partner.

APEP will collect data from the communities and research ways to improve the technologies for future projects. The university will also ensure that the microgrid controller meets national standards.

Some of the homes will be used to demonstrate “vehicle-to-home” charging, in which an electric vehicle can be used as an additional energy source for the home during an outage.

Residents will have an option to sign up for a Virtual Power Plant (VPP) program, in which their battery storage, EV chargers and other flexible loads can be automatically dispatched to the grid. VPP participants may be eligible for compensation.

In addition to solar-plus-storage systems, each home will be equipped with high-efficiency appliances and flexible loads such as electric heat pump water heaters and space heating and cooling systems. Project partner Schneider Electric will provide smart load panels and connected wiring devices that integrate and control the distributed energy resources.

Construction Underway

Construction started a few months ago on the homes at Durango and Oak Shade, according to a KB Home spokesperson. About 50 houses have been sold so far, and residents will start moving into their homes in February or March.

The three- to five-bedroom homes range from 1,472 to 2,906 square feet and most are priced in the $500,000 range, according to KB Home’s website.

SunPower’s project was one of 10 that received “connected communities” grants from DOE last year totaling $61 million. (See ‘Connected Communities’ Get $61M in DOE Funding.) Connected communities tie together a group of grid-interactive efficient buildings (GEBs).

DOE is hoping the demonstration projects will accelerate the technology development, commercialization and deployment of GEB systems across a range of locations, climates and building types.

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EBC Partners Tackle Decarbonization in the Bronx ‘Towers’

Canadian company SHARC Energy will build a combined wastewater energy transfer (WET) geothermal system for heat and water in two of Amalgamated Housing Cooperative’s (AHC) buildings in the Bronx as part of New York state’s Empire Building Challenge (EBC).

SHARC, AHC and geothermal energy company Egg Geo announced their plans last month to retrofit the two co-ops, collectively called “the Towers,” by installing their system, which uses heated wastewater from, for example, a building’s dishwashers, showers and laundry machines to bring energy, usable water and heat to tenants.

The partnership leverages some of the $50 million that was allocated by the New York State Energy Research and Development Authority (NYSERDA) through the EBC to improve building energy efficiency across the state with decarbonization systems. (See Empire Building Challenge Seeks to Decarbonize NY High-rises.)

So far, the EBC has selected 16 real estate partners, including AHC, who have sought to collectively decarbonize the more than 70,000 housing units they manage and develop a “Playbook” that other building owners can study to learn how they can make their assets more climate friendly.

Several of these partners have already made tangible commitments to decarbonize their building stock.

Towers Boiler Plant Map (Amalgamated Housing Corporation) Content.jpgGeographic representation of current heat & water generation system for Towers | Amalgamated Housing Corporation

Vornado plans to make its portfolio carbon neutral by 2030 through a combination of solutions, including upgrading façades with curtain walls of steel and glass, using steam to heat its buildings’ water with less energy input, and installing centralized air systems to better distribute air and keep buildings cooler.

Empire State Realty Trust (ESRT) has targeted 2035 to be carbon neutral by partially electrifying their heating, ventilation and air conditioning (HVAC) systems, installing large heat pumps in buildings, and replacing outdated systems during lease turnovers, which is already ongoing in the Empire State Building.

And Hudson Square Properties (HSP) plans to take a more phased approach where it retrofits buildings floor-by-floor since this avoids significant tenant disruption, allows for greater flexibility, and fewer budgetary concerns.

Buildings are one of the greatest barriers to New York’s climate and energy goals because they account for roughly 30% of the state’s total carbon emissions and much of the stock is decades old, meaning upgrades will be costly.

The Towers, located in the Bronx’s Van Cortlandt Village, together contain 372 units with an average of four people per apartment and extend 20 floors up. The first building was built in 1968 and the second in 1971. They currently depend on a far-away distribution boiler system based that uses steam for heating, cooling and hot water.

‘Indigenous Energy Supply’

Lynn Mueller (SHARC Energy) FI.jpgSHARC CEO Lynn Mueller | SHARC Energy

In an interview with NetZero Insider, SHARC Energy CEO Lynn Mueller said the WET system being installed in the Towers taps into the building’s wastewater stream and uses a patented direct heat transfer system, which functions through a heat exchanger located directly within Egg’s geothermal heat pump, to domestically pre-heat incoming water for future usage within the building.

Mueller said the combined system will require about “45% less space” than similar systems, “reduce costs by a similar magnitude” and provide the Towers with their own “indigenous energy supply.”

“If you are throwing away $5, and I can reach back in there and get it back for just $1,” then the economics “just make sense,” Mueller said. The system uses the “ubiquitous” supply of wastewater to “continuously grab energy from the waste stream,” which tenants can reuse from “birth to death.”

Mueller claims that the Towers can reduce their annual estimated carbon emissions by 1,200 to 1,500 tons, which he said equates to offsetting nearly “750 cars a year.” The CEO believes that wastewater heat recovery systems, such as SHARC’s WET system or its smaller single-building Piranha system, will be everywhere in the future, as sewers are a city’s “common artery.”

Steve Beyers, an engineer, researcher and building energy heat expert at Cornell University, told NetZero that the “the concept of using heat from wastewater as a heat pump source/sink is not new, but the SHARC technology is arguably simpler and requires no compression cycle or refrigerants.”

SHARC Geothermal Heat Pump System (Amalgamated Housing Corporation) Alt FI.jpgVisual representation of SHARC geothermal heat pump system | Amalgamated Housing Corporation

The company’s technology “may well be unique in its packaging and market maturity,” as he had not seen anyone else “offering a similar packaged system.” But, he noted, Cornell once considered a similar technology for its dorms that was never implemented because of the “upfront costs and maintenance concerns.”

In a statement to NetZero Insider, a NYSERDA spokesperson said, “SHARC’s Piranha system offers the potential to achieve a high-performance heat pump system that also captures and reutilizes waste heat from the project site. Wastewater heat recovery could potentially be an important technology for building decarbonization. The state’s Empire Building Challenge program is supporting a feasibility analysis of this novel technology, and we look forward to reviewing the results of this work as we continue to identify new technologies that support the goals of the state’s Climate Leadership and Community Protection Act.”

“Amalgamated has been ambitious in their decarbonization efforts,” Egg Geo President Jay Egg said in a statement. “That, along with the vision and support from NYSERDA’s Empire Building Challenge to carryout technical feasibility, have brought together an incredible team that will guide this project through to a fully capable retrofit that will decarbonize and electrify the Amalgamated Towers in the Bronx.”

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NJ BPU Opposes Community Solar Program Expansion

The New Jersey Board of Public Utilities (BPU) is opposing a bill that would more than triple the size of the state’s heavily oversubscribed community solar program, saying the expansion could stress an already overloaded grid and “bring everything to a screeching halt.”

Chance Lykins, the BPU’s director of government affairs, told the state’s Senate Environment and Energy Committee on Nov. 3 that the capacity increase outlined in the bill — from the 150 MW a year at present planned by the BPU to 500 MW a year — would have a series of consequences that could negatively impact agency solar programs.

Lykins made his comments at the first committee hearing of the bill (S3123), which was introduced Oct. 3. The committee did not vote on the bill. The hearing came as the BPU works to create a permanent community solar program, which will award incentives for 150 MW of capacity annually, after two rounds of pilot programs that together drew more than 650 applications and awarded 240 MW of capacity.

“This is one of the programs we’re most proud of,” Lykins said. “Because it both moves us towards our clean energy goals, while simultaneously helping us with our equity goals.”

Yet the agency is concerned about the impact of “moving these caps up so quickly,” he said. “We have to set these caps based on costs, on what the grid can support, on what the developers can do. … We think 150 megawatts is the correct cap for now.”

Sen. Bob Smith (D), the committee chairman and one of two primary sponsors of the bill, disagreed, saying the program’s success suggests it should be made bigger given the state’s goals.

“It is time to start thinking about a new allocation, in my opinion, because you already have the first one going and going well,” Smith said.

The proposed expansion highlights underlying tensions in the state’s solar programs that pit a desire by some stakeholders to expand rapidly against other stakeholders’ concerns about the cost, uncertain impact on other programs and logistical challenges.

The bill garnered support from solar developer Solar Landscape, solar software developer Arcadia, the Chamber of Commerce of Southern New Jersey, the mid-Atlantic representative of the Solar Energy Industries Association and the League of Conservation Voters.

But the New Jersey Division of Rate Counsel expressed concerns about the proposed expansion, saying it “had almost-certain potential for increasing costs to ratepayers.”

Director Brian O. Lipman, in a Nov. 2 letter to the BPU, said that forcing the agency to award such a large capacity each year would reduce its “ability to assure robust competition” between projects and make it difficult to ensure that incentives go to “projects that best serve the state’s clean energy goals.”

“Reducing the board’s ability to harness competitive processes in the community solar program may be in the interests of certain segments of the solar industry, but it is not in the best interests of ratepayers or the state overall,” Lipman said.

“In order to achieve the state’s clean energy goals, it is important to get the most ‘bang for the buck’ when ratepayers subsidize solar and other clean energy,” the letter said. “This will not happen if competition is reduced.”

Expanding Too Fast

The BPU’s community solar initiative is part of Gov. Phil Murphy’s push for New Jersey to reach 100% clean energy and generate 32 GW of solar by 2050. The state had 4.99 GW of installed capacity on Sept. 30, the latest BPU figure available.

The BPU expects to release a straw proposal for a community solar program soon and launch it next year. The two pilot programs held to date — which together awarded 150 projects — each attracted between four and five times as many applicants as were eventually awarded.

Still, the state has been slow in getting community solar projects installed. Only 18 projects have been installed since the state approved the first 45 community solar projects, totaling 75 MW, in 2019, according to BPU records. There are 108 community solar projects in the pipeline.

Lykins said a problem with greatly expanding the program and increasing the number of incentives is that developers could see it as more “lucrative” than other state programs, diverting them from those alternatives, including the Competitive Solar Incentive (CSI) program, which provides the “most economical projects.” The CSI program awards incentives to grid-scale solar projects — those larger than 5 MW in capacity — through a competitive process.

In addition, Chance said, the increased capacity of community solar could put “stress on the distribution grid,” which is already under great strain, with lengthy waits for some utilities to connect solar projects.

“There are certain territories where you cannot sign up even for a small rooftop program” to get connected to the grid, he said. “The concern is raising this cap this high is going to put those same pressures onto the local distribution grid and potentially bring the same problems we’re seeing at PJM here and just bring everything to a screeching halt.” (See Solar Developers: NJ’s Aging Grid Can’t Accept New Projects.)

Moreover, the community solar program to date has accepted only the “very best of the best” projects, he said. The sudden expansion of the program would require it to accept “less quality projects moving forward.”

Chance added that existing community solar projects already struggle to attract subscribers and the difficulty of finding them would limit further program expansion.

Searching For Subscribers

Community solar projects target users who either cannot or do not want to have solar on their roofs but want to support a clean energy initiative. To make the projects work the developer must sign up subscribers, who commit to using the clean energy and in turn receive a credit on their utility bill, reducing the electricity cost by a set percentage.

New Jersey’s program requires 51% of the clean energy to go to subscribers from low- and moderate-income communities, but that requirement has proven challenging to developers, in part, they say, because low-income consumers shy away from providing documents to support their low-income status in their application to become a subscriber.

However, Smith, brushed aside the concern. He told Lykins that the difficulty of finding subscribers would diminish if they were able to “self-certify,” or simply attest to their low-income status without offering proof, as some developers have suggested.

With a “self-certification” system in place, “the program’s going to be filled,” Smith said.

Allison McLeod, policy director for the League of Conservation Voters, agreed that the state should be looking to help disadvantaged consumers. She said community solar so far accounts for only 3% of all residential solar.

“We support using this as an incentive to continue to expand access to low- and moderate-income communities to get the benefits of community solar,” she said.

Yvette Viasus, community solar engagement manager for Solar Landscape of Neptune, New Jersey, the developer of more community solar capacity in the program than any other, said the program could be a good economic driver for the state. She said the program has helped Solar Landscape quadruple its size, and it now has 120 employees and 54 of the 150 projects approved in the program.

“Commercial property owners across the state are eager to host more community solar installations,” she said. “Community solar is ready to go today. Now is the time to increase the capacity of this program.

“It harnesses the potential of one of New Jersey’s most successful shovel-ready clean energy programs and enables us to make progress towards our 100% clean energy future while giving everyone a part to play in fighting climate change,” she said.

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Dominion Announces Full Business Review During Q3 Earnings

Dominion Energy is embarking on a “top-to-bottom” review of its investments and operations to address underperforming share values, the company announced during its third-quarter earnings call Friday.

“Fundamentally we took a look at how we’re doing — how our share price is doing — and the market is telling us that we’re not performing the way investors expect, so we think it merits a complete review from top to bottom,” Dominion CEO Robert Blue said during the call. The company started the year with a share price of $80.21 and has seen that fall over the past three months to $67.13.

The review will include looking at investments in businesses that may be considered “non-strategic” and exploring unregulated investment activities and initiatives. Blue said that the possible changes, however, are not likely to impact the “core earnings growth driver of this company: the continued execution of what we view as an industry leading, highly visible regulated decarbonization growth capital investment opportunity.”

Despite the decline in share value, Blue noted that operating earnings per share are above the midpoint of the company’s quarterly guidance range and said the company is well positioned to meet its annual expectations. It is setting expectations for 98 cents to $1.13 in earnings per share and has narrowed annual 2022 operating earnings to be between $4.03 and $4.18, with the midpoint remaining the same as its original guidance, according to the company’s announcement of the earnings report.

Blue also said the company has “been steadily executing on our investment programs focused on decarbonization. This successful execution is already benefiting our customers, communities, the environment and our investors.”

The company reported $778 million in net income ($0.91/share), compared to $654 million ($0.79/share) for the third quarter of 2021.

Steve Fleishman of Wolfe Research questioned what reasons Dominion believes could be behind its stock performance.

Responding to an analyst’s question about what has driven the company’s stock price, Blue said, “Investors are telling us … what they’re looking for is predictability. What they’re looking for is earnings quality.”

Coastal Virginia Offshore Wind Project Remains on Track

Work on Dominion’s $9.8 billion Coastal Virginia Offshore Wind (CVOW) project is continuing according to schedule, with onshore construction projected to begin in the third quarter of 2023 and offshore work starting in second quarter 2024. Completion of the 2.6-GW project is expected in late 2026, according to Blue’s presentation.

“Development of the project has continued uninterrupted to maintain the project’s schedule, and we expect over 90% of the project costs, excluding contingency, to be fixed by the end of the first quarter 2023 at the latest, as compared to about 75% today,” Blue said.

The company’s turbine installation vessel is more than 60% complete, and it expects it to be in service ahead of the 2024 turbine installation season, Blue said. There are currently no changes to the estimated installation cost, lifetime capacity factor or levelized cost of electricity.

A draft environmental impact statement is anticipated from the U.S. Bureau of Ocean Energy Management, which is also expected to release a record of decision in mid-2023.

The company recently signed a settlement agreement with several parties, filed with the Virginia State Corporation Commission (SCC), that proposes an alternative to the performance requirement ordered by the commission in August. The proposed agreement would supplement the requirement — which Blue had called “untenable” — with a review process in which the company explains any capacity shortfalls and the commission can determine remedies. (See Dominion, Va. Stakeholders File Settlement over Performance Req for OSW Project.)

The agreement also contains consumer protections for possible construction cost overruns. The other parties to the proposal are Virginia Attorney General Jason Miyares, the Sierra Club, Walmart and environmental advocacy organization Appalachian Voices.

“The agreement provides a balanced and reasonable approach that allows the project to continue moving forward to meet the commonwealth’s public policy and economic development priorities and the needs of our customers,” Blue said during the earnings call. “If approved, significant customer benefits include protection from unforeseen increases in construction costs above the project’s budget and enhanced SCC review of performance in lieu of a performance guarantee. We look forward to a decision from the SCC later this year.”

Blue said the completion of the project will be a boon to the local economy and jumpstart the development of further offshore wind projects drawing off upgrades at the Port of Virginia’s Portsmouth Marine Terminal to support OSW installations. (See Dominion Secures 10-Year Va. Port Lease for OSW Staging.)

Steven Ridge Promoted to CFO

Blue also announced the promotion of Steven Ridge, who currently manages Dominion’s Western natural gas distribution operations, to take the place of James Chapman as chief financial officer. Chapman is leaving the company to become treasurer at ExxonMobil.

Ridge “has a wealth of experience in finance, is well known to many of our investors and is a strong, capable leader. We are very fortunate to have him in this new role,” Blue said.