§ 365 — Offshore wind contracts

(a) Upon the development of a solicitation for an offshore wind contract, the State Energy Office shall submit a petition (the “petition”) to the Commission in accordance with § 8056(d)(8) of Title 29. Any Commission-regulated electric public utility shall be identified as parties to such petition, and shall have the opportunity to participate in the proceeding before the Commission considering such petition. All municipal electric companies and all rural electric cooperatives shall be served by mail with such petition.

(b) Within 90 days of submission of such petition, any municipal electric companies or rural electric cooperatives electing to participate in the solicitation shall submit such election in writing to the Commission, and shall indicate the amount of energy, in megawatts, that such entity would accept under an offshore wind contract negotiated pursuant to the solicitation. Any entity that potentially qualifies as a qualified purchaser may also submit, in writing, a request to be considered a qualified purchaser, and shall indicate the amount of energy, in megawatts, that such entity would accept under an offshore wind contract negotiated pursuant to the solicitation. Submission of such election or request binds such entity to the jurisdiction of the Commission for the limited purpose of approval and enforcement of any eventual offshore wind contract.

(c) The State Energy Office and the Commission shall confer regarding which proposed qualified purchasers should be included in any solicitation. The State Energy Office shall have sole discretion regarding which proposed qualified purchasers shall be included in the solicitation.

(d) The Commission shall, after opportunity for public comment, determine whether proceeding with the solicitation is in the public interest. This determination shall be based upon the following factors:

(1) Whether the State Energy Office has complied with the technical requirements and analyses contemplated in the OSW solicitation requirements.

(2) Whether the solicitation is consistent with the greenhouse gas emission reduction targets as outlined by § 10003 of Title 7, in light of the price and availability of all other new renewable or carbon-free alternative energy sources at a similar scale and production profile interconnecting to the PJM grid in Delaware, or states bordering Delaware.

(3) Whether proceeding with the solicitation is consistent with goals of the current Climate Action Plan.

(4) Whether proceeding with the solicitation is consistent with meeting the minimum percentage of electric energy sales with eligible energy resources as required by § 354(a) of this title.

(5) That proceeding with the solicitation will not adversely affect system reliability on the Delmarva Peninsula.

(6) That proceeding with the solicitation will likely result in submitted bids in a range that would ultimately lead to rates that are just and reasonable. Any rate change arising from a project which conforms with the Delaware benchmark price shall be presumed to be just and reasonable. Participation in the solicitation by municipal electric companies, rural electric cooperatives, or qualified purchasers, or the lack of such participation, shall not be a factor in whether the rates are just and reasonable.

Upon evaluation of the factors above, the Commission shall, if appropriate, issue an order confirming such findings (the “preliminary order”) within 180 days of submission of the petition. No extension of this period shall be granted by PSC absent good cause.

(e) After issuance of the preliminary order, the State Energy Office shall issue the solicitation. The docket shall remain open during the pendency of negotiations of any offshore wind contract, and the State Energy Office shall confer with the staff of the Commission, and any parties to the petition, in the development of terms of such offshore wind contract. The State Energy Office shall have sole discretion over final contract terms.

(f) Any offshore wind contract negotiated by the State Energy Office pursuant to § 8056(d)(10) of Title 29 shall be submitted to the Commission for final review and approval. The Commission’s review shall be to determine whether proceeding with the final offshore wind contract remains in the public interest, as defined by the factors set forth in subsection (d) of this section, and in light of the findings previously made by the Commission. Additionally, the Commission shall confirm, in light of its previous analysis, and in light of the actual winning bid, that proceeding with the offshore wind contract would result in rates that are just and reasonable. Consistent with the initial analysis prior to a preliminary order, any rate change arising from a project which conforms with the Delaware benchmark price shall be presumed to be just and reasonable. Participation in the solicitation by municipal electric companies, rural electric cooperatives, or qualified purchasers, or the lack of such participation, shall not be a factor in whether the rates are just and reasonable.

Upon confirming the findings required in this section, with no further testimony or intervenors allowed, the Commission shall issue an order (the “final order”) approving the offshore wind contract, and the costs of such contract shall be passed on to the customers of all utilities which are parties to the solicitation. The Commission shall issue a final order within 90 days of submission of the offshore wind contract. No extension of this period shall be granted by PSC absent extraordinary circumstances.

(g) Upon a showing of necessity by the State Energy Office, and upon a finding of good cause by the Commission, any solicitation can be considered on an adjusted schedule, either accelerated or extended, including when required to facilitate a coordinated solicitation with another state.

Legislative History

84 Del. Laws, c. 401, § 9