September 19, 2018

Millstone casts bid for state contract

HBJ File Photo
HBJ File Photo
Millstone Power Station in Waterford.

The state's largest power plant, the nuclear Millstone Power Station in Waterford, has cast its bid for a long-term Connecticut utility contract.

The plant is competing with dozens of other wind and solar proposals that also bid into the request for proposals overseen by the Department of Energy and Environmental Protection (DEEP).

The RFP drew dozens of bids Sept. 14 for solar projects inside and outside of Connecticut, including commercial-scale proposals in communities like East Windsor, East Granby, Bristol and Southington. It also drew bids from major offshore wind projects Vineyard Wind and Constitution Wind.

The RFP is the first opportunity of its kind for Millstone, as Connecticut has typically reserved such competitions to help spur the growth of renewable power, which nuclear is not.

However, nuclear plants emit no carbon dioxide, so state legislators crafted a law last year calling for a "zero-emissions" procurement. The RFP is seen as a way to help Millstone, whose executives have warned that the plant could close in the coming years, prior to its license expiring, due to financial constraints.

Millstone submitted several proposals to DEEP, covering varying contract lengths and amounts of power, though DEEP redacted the specifics, as it usually does for RFPs.

Plant owner Dominion has lobbied for a long-term contract for the past several years, an effort that faced opposition from other power plants and environmental groups, some of whom called the contract a subsidy or bailout that would ultimately cost ratepayers more money.

Some also worried that allowing a nuclear plant to compete with renewables could be unfair to the latter because Millstone could likely undercut renewables on price. Whether or not that's true, many renewable projects still chose to bid.

Millstone supporters have pointed to the plant's economic impact -- including a $100 million annual payroll -- and the fact that it produces 95 percent of the state's carbon-free power.

Emissions could rise as more nuclear plants retire, including in New England, forcing the region to rely even more heavily on natural gas to generate electricity. Millstone's nameplate capacity is a massive 2,100 megawatts. It could sell as much as 75 percent of its output to utilities Eversource and Avangrid, should it win a contract in the DEEP RFP.

Dominion is hoping DEEP will assess its bid as an "at-risk" facility, which would give it a leg up in the scoring. The company says it urgently needs the contract before March of next year, when it says it faces a "critical decision" of whether or not to delist itself from the forward capacity market in anticipation of retiring the plant.

DEEP has said it could make selections later this year.

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