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A better wind bill

Renewable EnergyNatural GasPetroleum IndustryWind PowerConsumersAlternative Energy

For all its risks and potential costs, Gov. Martin O'Malley's unsuccessful 2011 bill to facilitate the construction of offshore wind turbines near Ocean City would have benefited the state — and its electricity customers — through predictable, clean energy for decades to come. The 2012 version of the legislation should be a no-brainer. The governor's new proposal further shelters consumers from the risks of such a project and reduces the costs they may eventually pay. The House of Delegates, which voted Friday in favor of the plan, amended the bill to reduce the cost even more. It deserves the support of the full General Assembly.

Although offshore wind farms are relatively common in Europe, they have been slow to develop in the United States amid debate about their cost effectiveness and environmental benefits. They are certainly not the sole answer to Maryland's future power needs, but if the state has any hope of achieving its aggressive goals for renewable energy — and particularly if it hopes to do so in a way that benefits Maryland's economy — offshore wind needs to be part of the picture. Maryland is committed to getting 20 percent of its energy from renewable sources by 2020, and that will almost certainly require harnessing the wind off the Atlantic Coast.

Critics of the administration's efforts question the value of an individual state setting renewable-energy goals when greenhouse gas emissions and the climate change they contribute to are a global problem. Why should Maryland bother if China is going to keep building coal-fired power plants? The reason is twofold.

First, moves by Maryland and other states are building a consensus toward national action on the issue, and no global accord to limit greenhouse gas emissions is going to succeed without the United States' participation. Nearly half the states now have renewable-power goals. As more adopt them, Congress will be increasingly open to action.

And second, wind power is a good long-term bet for Maryland's electricity consumers regardless of its environmental benefits. A glut of domestic natural gas production may have tamped down energy prices for the moment, but that won't last forever, particularly if the United States starts large-scale exports of liquefied natural gas. And although the price tag for constructing an offshore wind farm is large — $1 billion or more — it sets the stage for stable production of energy for decades to come. We don't know what will happen to the price of coal and natural gas in the future, but we can be sure that the wind will remain free.

The Maryland Office of People's Counsel, which looks out for the best interests of electricity consumers, had serious concerns about Mr. O'Malley's wind bill last year, but it supports the 2012 version. The reason is that the legislation has been transformed in fundamental ways that limit consumers' exposure to risk.

Rather than requiring power companies to enter into long-term contracts to purchase wind power, as last year's bill did, this one specifies that a portion of the state's renewable-energy target must be met through the use of offshore wind. The new version specifies that the Public Service Commission can only approve a project that benefits Maryland's health, economy and environment. The bill specifies that any cost overruns be borne by the developers, not electric ratepayers; that we are paying only for actual production of electricity, not the construction of generation capacity; and that any increase in costs for consumers not exceed $1.50 a month for the average residential ratepayer.

Essentially, Maryland has set up a framework for a developer to build an offshore wind farm if the economics of the project meet the price we are willing to pay. As a policy statement, it says that offshore wind is important — but that we do not want it at any cost.

There is no question that the changes in this year's version of the bill produce a better deal for electricity consumers and a worse one for potential developers, so much so that it is not absolutely certain that any of them will bid on the project. The answer to that likely depends on the extension of federal subsidies and loan guarantees, and on a commitment by the federal government to purchase offshore wind power. But the key to this legislation, and the reason the General Assembly should approve it, is that if we get offshore wind power, it will be at a reasonable price, and if we don't, Maryland consumers won't be out a dime.

Copyright © 2014, The Baltimore Sun
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