Energy LawR.I. PUC Filing: Passing Offshore Wind Cable Costs onto Ratepayers

September 22, 20200

It’s no secret in Rhode Island that the first offshore wind farm pilot project, the Block Island Wind Farm, has seen its share of issues with the cable that runs from Block Island to Crescent Beach in Narragansett. But what is the regulatory process for National Grid to obtain a decision from the Rhode Island Public Utilities Commission, or PUC, declaring that they can pass the costs associated with repairing and re-burying the cable on to the ratepayers? Our blog today explores the regulations on these PUC filings.

Block Island Wind Farm Cable Repairs

The Block Island Wind Farm went online in 2016. The project developer was a company called Orsted. During that same year, the cables bringing energy created by the turbines to Block Island and Crescent Beach were exposed near the shore. The Coastal Resources Management Council (CRMC) and the Town of New Shoreham (Block Island) sought repairs to re-bury the cable in 2018, after allowing a temporary fix.

The CRMC staff and Executive Director recommended that the cable be buried to 8-10 feet at a minimum using horizontal directional drilling. But, the CRMC approved a lower-cost burial at four feet using jet plowing, which benefited National Grid and the project developer at the time. The jet plowing failed to bury the cable appropriately under the boulders and rocky areas closer to land, however, which exposed the cables. The fact that the cable failed to reach the target burial depth was not relayed to the CRMC by the drilling contractor. Eventually, after trying other methods, National Grid and Orsted completed the re-burying using the initially recommended horizontal directional drilling.

Orsted owns the cable that runs from the wind farm to Block Island and is paying for the reburial of that cable. National Grid owns the cable that runs from Block Island to Crescent Beach in Narragansett, and it filed with the PUC for a determination as to whether it could pass the costs of re-burying its cable (an estimated $30 million) along to its ratepayers. According to ecoRI News, National Grid will be able to recover these costs “through an undetermined surcharge on ratepayers’ bills.”

The National Grid RI PUC Filing

In Rhode Island, National Grid is the dominant electricity supplier. Their customer base, or ratepayers, consist of the majority of Rhode Islanders. The PUC has the powers of a court of record when it comes to matters within its jurisdiction, including “the rates, tariffs, tolls, and charges, and the sufficiency and reasonableness of facilities and accommodations of railroad, gas, electric distribution, water, telephone, telegraph, and pipeline public utilities, the location of railroad depots and stations. . .” The PUC adopted regulations to carry out its hearings pursuant to R.I. Gen. Laws § 39-1-11, which are located in the RI Code of Regulations.

Regulation 810-RICR-00-00-1.10(B), states that rate change PUC filings, such as the one National Grid filed to determine if it could pass the costs of cable re-burial on to the ratepayers, must additionally be accompanied by the documents required in the Additional Requirements for Filings of General Rate Schedule Changes. The regulations for the additional requirements state that PUC filings for rate changes must be noticed in the Providence Journal, and in the next billing statement or by mail. For the PUC to investigate the requested rate change, National Grid must submit written testimony and exhibits in support of the proposed rates, copies of its annual reports, and information on its rate base and costs of service, among other items. It must also serve these documents upon the Attorney General.

Ratepayers have the right to intervene in PUC filing proceedings where their interests are directly affected or where participation may be in the public interest. If you are wondering about this process or in regulatory proceedings before the PUC, contact our attorneys today! Email or call us at 401.477.0023.

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