Power plant hearings delayed as regulators consider request to cancel contract

Power plant hearings delayed as regulators consider request to cancel contract

BURRILLVILLE – In a turn of events seen as a win by power plant opponents, the final round of hearings on Invenergy’s proposed Clear River Energy Center will be delayed until at least November while the Federal Energy Regulatory Commission (FERC) considers a request by the regional grid operator to cancel the plant’s energy contract.

In September, ISO New England, the nonprofit responsible for overseeing the regional energy market, sent a letter to FERC requesting permission to cancel Invenergy’s capacity supply obligation contract due to the company’s failure to meet “critical path schedule milestones” in building its Clear River Energy Center. The contract, first awarded in 2016, is scheduled to take effect on June 1, 2019.

Opponents of the plant see the request as proof that energy produced by the Clear River Energy Center is not needed in the region, a key argument in the company’s attempt to operate despite fierce opposition from local residents and officials. The proposed plant is currently in its final round of hearings before the state Energy Facility Siting Board, which will decide whether Invenergy can move forward with the plant in a proposed location off Wallum Lake Road.

“Invenergy was really relying on this component to make this case, and if FERC does uphold the ISO decision, then I think the arguments they’ve made before the (Energy Facility Siting Board) are significantly weakened,” said Burrillville Town Manager Michael Wood.

Originally scheduled to complete hearings by the end of October, the Energy Facility Siting Board (EFSB) granted a request to await the federal decision before resuming hearings. FERC has 60 days to consider ISO New England’s request, and status conferences have tentatively been scheduled for Nov. 5 and 27.

Despite the setback, representatives from Invenergy said they still plan to move forward with the power plant without the energy contract. Michael Blazer, the company’s chief legal officer, issued a statement saying the regional energy need continues to grow, a need Invenergy intends to fill.

“As thousands of megawatts of existing capacity are coming off the grid and residents are facing some of the nation’s highest electric rates, the need for the Clear River Energy Center in Rhode Island is only growing,” he said. “Invenergy remains committed to filling this need, and as the project makes sense for the state, we are continuing development work and look forward to the EFSB hearing resuming.”

However, opponents say the gas and oil-burning plant is no longer needed in a market that has begun to shift toward renewable energy projects over the past three years. Jerry Elmer, the attorney representing the Conservation Law Foundation in the case, pointed out ISO New England has never before cancelled a capacity supply obligation contract due to building delays, further evidence, he claimed, that the plant’s energy is not needed.

“The EFSB by law has to look at two things. One is, ‘Is the proposed power plant needed?’ and two, ‘Would building the power plant cause unacceptable environmental harm?’ You now have very strong evidence before the EFSB that Invenergy loses on both of those legally required criteria,” he said.

Elmer also explained that even without permission to move forward with the plant, Invenergy has already received approximately $26.7 million in income from its capacity supply obligation (CSO) contract with ISO New England. The contract, scheduled to take effect in 2019, essentially guarantees the Clear River Energy Center will have the capacity to supply energy if necessary. However, with the plant not scheduled to come online until at least 2021, over the past two years, the company has sold its CSO to other energy companies at regional reconfiguration auctions for a combined $26.7 million.

“That’s now a done deal, but now that the ISO has yanked Invenergy’s CSO, they no longer have a CSO to sell for future years, so that sort of profiting off of ratepayers is going to come to a stop now,” said Elmer.

Hearings on the proposed plant will now likely continue into the winter, with a decision due 60 days after the conclusion of the final hearing. While opponents of the plant were hopeful the decision by ISO New England will lead the board to rule in their favor, Wood told The Breeze residents and officials continue to be watchful as the process moves into its fourth year.

“We look at this and we don’t understand how they can continue on with all of the setbacks they’ve had and yet they continue to push forward,” he said. “We’re not going to underestimate them, and we’re going to pay attention to what’s going on under the surface here.”