Delmarva Power appeals energy decision

Delmarva Power filed an appeal in Sussex County Superior Court on Wednesday, challenging the state’s decision to direct the power company to negotiate with several would-be energy providers, including BlueWater Wind, which has proposed to build an offshore wind farm.

Delmarva Power has consistently argued, and did in Tuesday’s appeal, that any of the proposed supply options would be too pricey for their customers and recommended striking all the bids to provide long-term energy.

Those bids included the wind farm, a “clean-coal” plant at Indian River and a natural gas plant upstate. The Public Service Commission and three other state agencies agreed last month to direct Delmarva to negotiate with BlueWater as a primary provider and the other two companies to serve in a backup capacity.

“The intent of the legislation enacted by the General Assembly last year, which resulted in these negotiations, was to lower, not increase customer bills,” Kirk J. Emge, a Delmarva Powre attorney, said in a statement Wednesday.

State legislators approved legislation last year to search for long-term, innovative and cost-effective supply options for Delmarva Power after rates jumped dramatically in May 2006. In its appeal, Delmarva Power also argued that state officials deviated from the rules of the process by favoring a hybrid approach that was not supported in any of the submitted bids.

“In essence, the commission ignored (the legislative) mandate for cost-effective power by requiring negotiation for not just one but two over-priced contracts,” Delmarva Power’s appeal reads.

Delmarva Power officials said they plan to continue negotiations as the situation plays out in court but refused to comment further. Jim Lanard, a spokesman for BlueWater, said company officials are “troubled” by the appeal. “But we remain hopeful that if Delmarva negotiates in good faith we can reach an outcome that is in the best interests of Delmarva’s customers.”

Lanard said a negotiation meeting was scheduled for Thursday. Michael Sheehy, deputy director of the Public Service Commission, said the commission staff had received a copy of the appeal by Wednesday afternoon. A staff report issued before the commission vote first recommended a hybrid approach, with BlueWater as the primary provider.

“We’re planning on pressing forward until told to do otherwise,” Sheehy said. “Delmarva Power has exercised a legal right that it has.”

Secretary John Hughes of the Delaware Department of Natural Resources and Environmental Control, one of the state agencies that directed Delmarva Power to negotiate, commented on the situation Wednesday.

“They don’t seem to be able to accept the thrust and reality of wind power,” Hughes said of Delmarva Power. “Delmarva Power is engaged in turf battles, and perhaps for good reasons.” Hughes added, “Never in my career have I seen Delawareans so uniformly in agreement with an energy proposal as they have been for wind. There’s cross-cutting, broad-spectrum support.”