ANNAPOLIS — Facing mounting concerns about his plan to spur development of an offshore wind farm, Gov. Martin O’Malley said on Wednesday he will tweak the measure to initially limit the costs that could be passed along to consumers.
“Make no mistake,” O’Malley said at a news conference, backed by union steelworkers and environmentalists. “This bill is the right choice for ratepayers. It stabilizes over a long period of time prices and decreases our reliance on either imported fuels, or fuels that under current technology, contribute to the degradation of the ozone [layer].”
O’Malley’s top energy proposal this session would require the state’s electric utilities to enter long-term energy purchase agreements for a total of 400 to 600 megawatts from a wind farm to be built off the state’s Atlantic coast.
Lawmakers cooled to the proposal after receiving a wide range of cost estimates. Wind energy is one of the most expensive types of energy to produce, according to a Sage Policy Group Inc. report, and a variety of state sources initially estimated the governor’s bills, SB 881 and HB 1054, would add between $1.50 and $8 to monthly residential power bills. The Public Service Commission has revised its initial projections to a range between 92 cents and $3.
The governor’s amended proposal would require the PSC to disqualify any long-term purchase proposals that cost consumers more than $2 a month for the first year.
“I think that will provide some level of comfort,” House Economic Matters Committee Chairman Dereck E. Davis said of applying a price cap. “Whether it gets us there or not, I don’t know.”
His counterpart in the upper chamber, Sen. Thomas M. “Mac” Middleton, D-Charles, said the cap “addresses some concerns.”
Middleton, the chairman of the Senate Finance Committee, said he supports the governor’s effort but added there are “just lots and lots of questions.”
“It’s a real, real challenge to get a bill out right now,” he said.
Middleton said some lawmakers have indicated they want to relegate the bill to a study for the summer. His committee began holding meetings with lawmakers and the governor’s staff on Friday to work through their issues regarding the bill, and Davis said his committee will likely start heavy lifting on the bill on Tuesday.
“I’ve committed to them that I’ll try to work on the issues,” Davis said.
O’Malley said he wants to see action on the legislation this session after offering lawmakers the $2 guarantee for the first year. After that, however, the price per consumer would be uncapped because, the administration said, it anticipates the cost of wind power will decline and the cost of other energy sources will increase.
“I think people are still so skittish over the deregulation vote that many of them cast years ago that had the unintended consequence of the big spike in energy prices, and they want to make sure they’re guarded against that,” O’Malley said.
The governor touted the economic benefits he anticipates will come with his wind plan. The state estimates construction of a wind farm large enough to accommodate the generation needs would create some 2,000 construction and manufacturing jobs in the state, and another 400 permanent jobs to keep the turbines spinning.
Tim Weller, project manager for Phoenix International, said his company is considering expanding its presence in Maryland to tackle wind projects proposed up and down the East Coast. Phoenix is an underwater engineering and surveying firm that works on gas and oil drilling in the Gulf of Mexico and explores underwater landscapes and shipwrecks.
The work that would need to be done to survey the sea floor and install the pilings that would support the turbines, Weller said, “that’s our bread and butter.”
O’Malley called the legislation “a win-win for Maryland.”
“It’s a win for jobs, it’s a win for the environment, it’s a win for every consumer who wants to do their part to make sure we combat climate change and are able to improve the health of our environment,” he said.