The New York State Public Service Commission (PSC) has denied petitions for four offshore wind projects to raise prices in their previously agreed power purchase agreements (PPAS).
The projects are Orsted’s 924MW Sunrise Wind and Equinor and BP’s 1230MW Beacon Wind, 816MW Empire Wind 1 and 1260MW Empire Wind 2. The Alliance for Clean Energy New York (ACNY) petitioned on behalf of another 86 land-based renewable projects.
The offshore wind developers were seeking to adjust prices in their offtake agreements to address recent inflationary pressures that are impacting project economics. This would have incorporated an adjustment mechanism to account for inflation and other economic impacts cited by the developers.
The PSC stated that the contract amendments sought by the developers were not in the best interest of New York’s ratepayers.
Granting their request, the PSC stated, would have increased power prices by 6.7% for residential customers and as high as 10.5% for commercial or industrial customers on monthly bills.
“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 PSC 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 mobilise the industry to achieve our critical State goals dependably and cost-effectively, and we do so again through today’s action.”
Additional petitions making similar requests from Clean Path New York for the Clean Path New York transmission project and by HQ Energy Services (US) Inc. for the Champlain Hudson Power Express Project remain under review by the Commission.
The move has met with dismay in industry, with leaders saying it put the state’s climate goals in peril.
“With one shortsighted decision, the NYSPSC has thrown New York’s environmental and clean energy future into peril,” said American Clean Power Association chief executive Jason Grumet.
“Absent a robust offshore wind industry, it will not be possible for New York State to achieve its climate or environmental justice goals,” he added.
“Moreover, critical economic benefits from new manufacturing facilities and the revitalization of ports will be squandered along with the creation of good paying union jobs. New York State has been a national leader in the clean energy transition.
“We urge New York State to maintain its clean energy commitment and reconsider this decision.”