Energy

Toray wants commission to mull potential negatives of wind farm

BLOOMBERG NEWS/KEN JAMES
THE R.I. ECONOMIC DEVELOPMENT CORPORATION admitted in public filings that its study on the potential impacts of the proposed Deepwater Wind offshore wind energy facility does not take into account what might be negative impacts of the project, including what is projected to be a higher price for electricity.
Posted 7/30/10

WARWICK – The R.I. Economic Development Corporation said Thursday that its study of the economic impact of an offshore wind farm looked only at the positives. Asked by Toray Plastics (America) Inc. if the study factored in potential negative effects of the farm’s above-market electric rates, the EDC replied, simply, “No.”

The EDC made the reply in filings with the R.I. Public Utilities Commission as the commission mulls approving a power-purchase agreement between National Grid and offshore wind farm developer Deepwater Wind.

Toray, which operates a plastics manufacturing plant in North Kingstown, has complained that the wind farm off Block Island would lead to higher electricity rates. That, Toray says, would harm the local economy. It commissioned its own report in which a University of Rhode Island economics professor called the economic gains of a wind farm speculative at best.

Shigeru Osada, a senior vice president at Toray, added in an interview Friday that he believed the price of electricity coming from the wind farm would not be competitive with that from traditional sources, even if those prices increase.

Osada pointed to the proposed 20-year contract before the PUC that allows Deepwater to increase rates by 3.5 percent annually regardless of the economy. Prices for electricity generated from traditional sources like coal and natural gas fluctuate widely depending on the global market.

In its own report, an EDC consultant that said the Block Island farm would generate $107 million in economic impact.

But Toray took issue with the modeling undertaken by the consultant, Levitan & Associates. Toray said the method employed, known as IMPLAN, ignored affects caused by Deepwater selling electricity at rates above market prices. And while the EDC acknowledged as much Thursday, it said that the question was “not relevant to the proceeding.”

Lawyers in the case have until Aug. 6 to file arguments on that point.

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