Connecticut Releases Clean Energy Solicitations
Solicitations for Offshore Wind and Other Zero Carbon Energy Resources to Advance Energy Affordability, Reliability, and Reduce Greenhouse Gas Emissions
(HARTFORD, CT) — The Connecticut Department of Energy and Environmental Protection (DEEP) today released two Requests for Proposals (RFPs) for new grid-scale zero carbon electricity resources. The proposals will help advance Governor Lamont’s Energy Action Plan to improve energy affordability and reliability for Connecticut ratepayers, and help achieve the state’s statutory mandates for a 100 percent zero carbon electric sector by 2040 and economy-wide greenhouse gas (GHG) emissions reduction of at least 80 percent below 2001 levels by 2050.
“Grid-scale clean energy projects are critical investments to diversify our grid, which will help protect Connecticut residents and businesses from price spikes linked to global fossil fuel markets and geopolitical events, while making our energy supply more reliable and our air safer to breathe,” said DEEP Commissioner Katie Dykes. “Continuing to make progress toward a zero-carbon grid is essential, as the public health and economic costs of carbon pollution are now being felt more regularly and severely here at home, from July’s devastating heavy rainfall that caused significant flood damage to farms and crops statewide, to Canadian wildfire smoke impacts throughout the summer.”
The two RFPs are for new offshore wind and other new zero carbon electricity generating resources, which include solar, onshore wind, energy storage paired and co-located with a zero carbon resource, zero carbon fuel cells, geothermal, energy efficiency, and run-of-river hydropower. The offshore wind RFP, for up to 2,000 megawatts (MW), is aligned with the procurement efforts of Massachusetts and Rhode Island. The three states announced in early October a first-of-its kind agreement to explore potential multi-state offshore wind procurements. Combined, the states’ solicitations are for up to 6,800 MW of offshore wind. The three-state agreement creates a pathway for a potential coordinated selection of competitive offshore wind bids as each state solicits offshore wind energy generation through their respective state procurements.
The new zero carbon RFP seeks bids for up to approximately 15% of the state’s electricity load, or 3,975,000 megawatt hours (MWh). The RFP includes requirements to ensure projects located in Connecticut are consistent with the state’s broader environmental policy goals, including by prohibiting projects located in core forest, prohibiting development on prime farmland unless a project follows specific dual-use design requirements, and prohibiting solar projects on slopes greater than 15%.
Actual project selections and resource amounts under the offshore wind and zero carbon RFPs will depend on the bids received and DEEP’s evaluation of the ability of proposed projects to provide affordable and reliable clean energy and other benefits to Connecticut residents and businesses. Both RFPs request private developers to submit bids to DEEP by January 31, 2024, to build new clean energy resources. Any selected bidder would enter negotiations for contracts with the state’s electric distribution companies, which would be submitted to the Connecticut Public Utilities Regulatory Authority (PURA) for review and approval.
Following recommendations from the state’s Commission on Environmental Standards, DEEP incorporated into the offshore wind RFP robust requirements for bidders’ environmental and fisheries mitigation plans, including requirements that selected bidders provide at least $5,000/MW to support regional fish and wildlife monitoring, $5,000/MW for wildlife mitigation funding, and $5,000/MW for fisheries mitigation funding (i.e., at least $15,000/MW combined for these purposes).
A new provision in the offshore wind RFP allows bidders to submit pricing at a fixed rate or at a rate that is indexed to the price of listed macroeconomic factors and commodities and that would be fixed at a date certain in the future. This indexed pricing option adjusts for changes, such as inflation, that may occur after the bid due date but before the project reaches financial close (i.e., when project costs for the developer are more locked in) to adjust the final price up or down by no more than 15%. Additionally, the RFP allows bidders to submit bids to Connecticut alone as well as multi-state bids to Connecticut along with Massachusetts and/or Rhode Island.
The RFPs are consistent with decarbonizing Connecticut’s electricity grid by 2040; achieving the state’s economy-wide GHG emissions reduction goals, including an interim GHG emissions reduction target of at least 45 percent below 2001 levels by 2030; and other energy and environmental goals and policies established in DEEP’s Integrated Resources Plan (IRP) and Comprehensive Energy Strategy. The solicitations follow the recent announcement of the State’s strategic roadmap for offshore wind to drive local economic development in the offshore wind industry, which will be supported by a newly-formed public-private group known as the Connecticut Wind Collaborative.
With the passage of the federal Bipartisan Infrastructure Law and the federal Inflation Reduction Act, which constitutes the single biggest climate investment in U.S. history, DEEP anticipates that new clean energy resources are poised to benefit from new federal incentives designed to lower costs. Bidders into both RFPs are required to detail how they will take advantage of available federal funding and incentive opportunities to maximize benefits to ratepayers.
In addition to these two RFPs, DEEP is also preparing an RFP for energy storage facilities, to further enhance grid reliability; that RFP will be released in draft form for public comment later this year. The forthcoming solicitation for energy storage will be conducted under Conn. Gen. Stat. § 16-243dd and in furtherance of Conn. Gen. Stat. §16-243cc, which sets a state deployment target of 1,000 MW of energy storage by 2030 with interim targets of 300 MW by 2024 and 650 MW by 2027.For more information, please visit the DEEP Energy Filing webpage here: Energy Filings (state.ct.us): Offshore Wind RFP and Zero Carbon RFP