2016 Press Release
June 6, 2016
DEEP Says RFP Process Will Bring Cleaner, More Affordable, and More Reliable Energy to CT Families and Businesses
RFP process will allow comparison of projects for
large and small scale clean energy as well as natural gas resources
Connecticut’s Department of Energy and Environmental Protection (DEEP) continues to make progress on a series of historic Requests for Proposals (RFPs) to secure new, cost-effective clean energy resources that will help to ensure affordable and reliable electricity for Connecticut families and businesses – especially during winter months when demand for electricity is high.
DEEP has issued the final version of an RFP for natural gas resources, seeking bids for liquefied natural gas, natural gas pipeline capacity, and natural gas storage. The intent of this RFP – issued on June 2 – is to procure natural gas resources that will be utilized by natural gas generators in the New England region to improve the affordability and reliability of regional electric supply. Bids will be due on this natural gas RFP on Wednesday, June 29, 2016. Once bids have been received, DEEP will evaluate the submissions for possible selection towards the end of the summer. This is the third and final RFP DEEP is issuing as required by Public Act 15-107.
The two previously issued RFPs sought project bids for:
- Large-scale clean energy, (20 Megawatt and above) and associated transmission
- Small-scale clean energy, energy efficiency, and energy storage (2-20MW).
Information for the large-scale clean energy procurement is available on the New England Clean Energy RFP Website. Information on for the two other RFPs is available on DEEP’s Website.
A lack of natural gas pipeline capacity to serve electric power plants in the region is threatening the reliability and affordability of power in New England. Due to a limitation in the design of the regional energy market, natural gas power plants do not invest in the pipeline capacity needed to secure the fuel they need to run on the coldest winter days. As a result, the region is relying on dirtier oil and coal plants to maintain reliable electric power in winter peak periods.
DEEP has recognized that a variety of resources offer the potential to address this problem, such as gas pipelines, gas storage, and liquefied natural gas; as well as clean energy generation such as renewables and hydropower, energy storage, and energy efficiency. Projects to accomplish this may be selected through the three competitive RFPs, which are open to a very broad range of resources in order to secure the greatest benefits for electric ratepayers at the lowest costs.
The RFPs are authorized under Public Act 15-107, which, together with an earlier statute, Public Act 13-303, authorizes the Department to seek proposals from a broad range of resources that can help to address energy infrastructure constraints in New England. Under these two Public Acts, DEEP has the authority to select clean energy projects to meet up to 15% of the state’s electric demand, and natural gas resources up to 375,000 mmcf/day.
More than 100 Bids Received in Small Clean Energy RFP Bids
In May, the Department received 107 proposals from bidders in response to an RFP for new, small-scale clean energy projects. The 107 project proposals included a wide range of technologies: 66 solar projects, 12 fuel cells, 15 energy storage systems, 1 hydropower, 7 wind, 1 combined heat and power, 3 anaerobic generation and 2 energy efficiency projects. Most of the projects would be located in Connecticut, with a handful in the rest of New England, New York and Canada.
Bids in response to the RFP were due Wednesday, May 4th. Public versions of all bids received are posted on DEEP’s website, along with other information about the RFP. Many developers submitted multiple bids reflecting different pricing and project formulations. DEEP has commenced a rigorous evaluation of the bids’ project viability, bid price and other project benefits. DEEP expects final selection of the projects to take place later this summer.
Evaluation of Bids Continuing for Three State RFP
DEEP, in coordination with utility and state partners in Rhode Island and Massachusetts, is currently evaluating more than 50 responses to an RFP for large-scale renewables and hydropower, including six new transmission lines to deliver incremental clean energy to New England. Projects are being evaluated on a broad range of threshold eligibility, pricing, and qualitative factors.
The Commissioner of DEEP will make the final selection of any projects under all three RFPs, after consulting with the Connecticut Attorney General, Consumer Counsel, and Procurement Manager. The costs and benefits of projects will be compared among the three RFPs. No project may be selected unless its benefits exceed the costs to Connecticut ratepayers. Contracts awarded under this RFP will be subject to review and approval by the Connecticut Public Utilities Regulatory Authority.
Comment on RFP Process
“We believe the response to the three RFPs will bring us potential projects that offer practical and cost effective solutions to Connecticut’s energy needs,” said DEEP Commissioner Robert Klee. “We will be able to select from a full-range of projects – large and small clean energy, and natural gas resources as well as from new technologies such as energy storage – and select those that offer the best price and the best advantages for Connecticut’s electric ratepayers.”
“Our use of open and competitive RFPs is a creative and innovative approach to securing the energy resources we need to meet the needs of our families and businesses,” Klee said. “Through these RFPs we can transition to cleaner forms of power generation while addressing gaps in the system that drive up prices and threaten the supply of the electricity we need.”