BLOCK ISLAND POWER COMPANY CONNECTED – SHUTS DOWN GENERATORS
The Block Island Power Company successfully transfers the Island’s electrical system to Deepwater Wind’s Block Island Wind Farm and National Grid’s Sea2Shore submarine cable.
Block Island, Rhode Island (May 1, 2017) - The Block Island Power Company silenced their diesel generating plant in the pre-dawn hours this morning, on purpose. The Island went dark momentarily in a well-planned sequence of high voltage switching intended to shut down the diesel generators. The Block Island Power Company employees then systematically turned the lights back, this time powered by energy provided by the nation’s first off-shore wind project and the mainland grid. The silence is symbolic of saving nearly one million gallons of diesel fuel annually.
The early morning transfer of the Island’s electrical grid was the final step in a process that began more than a decade ago, with customer’s concerns peaking in 2008 when the high cost of fuel for the generators drove electrical costs to over 60 cents per kilowatt/hour. Current Block Island Power Company Board Chair, past Town Manager of New Shoreham and long-time Block Island resident Nancy Dodge remembers those days well. “It was impossible to effectively budget for the town's energy expenses when fuel prices were so unpredictable and more than half of the bill for every town building was attributable to the fuel adjustment. That was impeding needed spending in other critical areas,” stated Dodge.
The idea of running a submarine cable turned to reality when the Deepwater Wind Block Island Wind Project was proposed. The project, which would become the nation’s first offshore wind farm, needed a connection to the mainland grid that could be used to deliver its output to the residents of Rhode Island. The cable to Block Island, which was built and will be owned and operated by National Grid, was christened by National Grid as the Sea2Shore Project when the company bought the cable rights in 2015. Without the Block Island Wind Farm Project, the cable would still be out of reach for Block Island.
“It’s only fitting that Block Island has made history as the first town in the United States to be powered by offshore wind,” said Deepwater Wind CEO Jeffrey Grybowski. “It’s our honor to celebrate this historic milestone with Block Islanders. We’re confident that the example Block Island has set will inspire communities up and down the Eastern Seaboard to chart their own path toward a renewable future.”
“National Grid is honored to be part of this landmark event that benefits the people of Block Island while providing a new source of clean, renewable energy to our mainland customers,” said Timothy F. Horan, President & COO of National Grid in Rhode Island. “This collaborative project between National Grid, Deepwater Wind, Block Island Power Company, elected officials, regulators and the people of Block Island shows what can be accomplished when all parties work for the common good.”
In addition to having access to the Block Island Wind Farm output, the cable presents the Block Island Power Company customers an opportunity everyone had had been waiting on for decades. At last, the approximate 2,000 electric customers on Block Island will now have access to lower cost, cleaner and stable whole energy markets. “Wholesale energy prices are at historic lows right now and to have the opportunity to secure some long-term contracts for our customers provides price stability and allows customers to budget month to month, rather than have their electric bills tied to volatile diesel fuel prices,” said Interim Block Island Power Company President Jeffery Wright. “Our power contract, that went into effect today, will take us into the fall of 2018. Between now and then we will monitor the regional energy markets and seek out even better opportunities that will provide our customers with predictable electric rates.”
Block Island electric ratepayers will see immediate relief in their electric bills. “The simplest way to explain the immediate impact to the bills is that the Fuel Cost Adjustment is going to be replaced by a Standard Offer and Transmission Charge that will be a combined 12.44 cents/kWh,” said Wright. To calculate the impact on your individual bill, replace the Fuel Cost Adjustment, which was 16.82 cents/kWh in April, with this new rate. Ratepayers have been enjoying recent relief in the form of lower Fuel Cost Adjustment charges due to lower fuel costs but that has not always been the case. The average Fuel Cost Adjustment since 2012 is 25.6 cents/kWh.
Access to the wholesale markets changes how the Company will look at its costs. The Company will be preparing a restructuring plan and cost of service study during the summer of this year to review how the Company’s costs will be distributed amongst the ratepayers. Until the plan is completed, the other charges on the bills will be staying the same. Two of the charges frequently asked about are the Demand Charge and the System Charge which will be reviewed.
In anticipation of the May 1st connection to the Sea2Shore Cable Project and the Block Island Wind Project, the Town of New Shoreham First Warden, Ken Lacoste summarized the milestone as historic. “The construction of the Block Island Offshore Wind Farm and the undersea cables represent a monumental engineering effort. On Block island, where the wind once powered gristmills and filled the sails of the fishing fleet, electric power will now be generated with each rotation of the giant turbine blades. The nature of our energy supply has taken a giant step forward and in doing so sets the pace for other offshore wind development. It is gratifying to have The Town of New Shoreham be a part of and benefit from this endeavor.”
An additional benefit of the project is that the Town of New Shoreham now has access to fiber optic cable built into the Sea2Shore Cable. The Town of New Shoreham is looking into how best to make use of that high-speed connection to the mainland. “Today is the final step of this particular project, but as well today opens new doors and opportunities for everyone on Block Island.”
The Block Island Power Company serves approximately 2,000 customers and has been serving the Island with locally generated power since 1925. The Town of New Shoreham recently purchased a two-thirds share of the Company and is in the process of transitioning to a Public Utility District.
Deep Water Wind-
Deepwater Wind is proud to be America’s leading offshore wind developer. The company’s path breaking Block Island Wind Farm is the first in the nation. Led by a veteran management team with experience in developing complex energy projects worldwide, Deepwater Wind is making offshore wind in America a reality.
Headquartered in Providence, RI, we are actively planning offshore wind projects to serve multiple East Coast markets located 15 or more miles offshore, including New York, Massachusetts, Rhode Island, Maryland, and New Jersey.