Maryland PSC denies Skipjack's Motion to Disqualify US Wind Inc bids

4C Offshore | Tom Russell
By: 07/10/2021 PSC
The Public Service Commission of Maryland (PSC) has announced that its has denied a Motion to Disqualify in Part US Wind, Inc.'s (US Wind) offshore wind application. The Motion was submitted by Skipjack Offshore Energy, LLC (Skipjack) on 9 September 2021.

On 22 December 2020, the PSC commenced its Round 2, Year 1 Offshore Wind Application Period and opened a 180-day window during which developers could submit offshore wind applications. At the close of the application period, five offshore wind bids were received by two entities – namely US Wind and Skipjack.

US Wind submitted three mutually exclusive bids for projects with commercial operation dates (CODs) of 2026, 2027, and 2028. Specifically, US Wind submitted: Bid 1, which proposes a 411.6 MW project with a COD of 2026; Bid 2, which proposes that 411.6 MW be built and commence operation in 2026, with a second tranche of 396.9 MW to be built and commence operation in 2027; and Bid 3, which proposes that 411.6 MW be built and commence operation in 2026, with a second tranche of 793.8 MW to be built and commence operation in 2028.

In its Motion to Disqualify, Skipjack argues that Bids 2 and 3 of US Wind’s application do not meet a provision which requires offshore wind project proposals submitted during the Application Period for Round 2, Year 1 to begin creating offshore wind renewable energy credits (“ORECs”) “not later than 2026.” Skipjack claims that, contravening that requirement, the price schedules included in US Wind’s Bids 2 and 3 “will not begin creating ORECs until 2027 or later,” and fall outside the scope of applications the Commission is permitted to consider during the Round 2, Year 1 Application Period.

Skipjack argues that “[i]f the Legislature intended to allow the consideration of a project proposed in the Round 2, Year 1 application period to also include projects that were to be considered in the Round 2, Year 2 application period,” it would not have required separate application periods. Skipjack further contends that differences between the Round 1 requirements of the Offshore Wind Energy Act of 2013 and the Clean Energy Jobs Act of 2019 “demonstrate a legislative intent to regulate the OREC application process in a way that places equal burdens on each developer to propose project plans that achieve OREC creation by the same date.”

In a response issued on 17 September 2021, US Wind argued that its application fits within the plain meaning of the statutory text, asserting that Bids 1, 2 and 3 each propose projects that would begin creating ORECs no later than 2026. US Wind also outlined that that nothing in the statute requires that an applicant “create the entirety of their ORECs not later than 2026,” and that the plain meaning of the word “begin” is to commence, not to complete.

The PSC found that it would be inappropriate to grant Skipjack’s Motion to Disqualify at this time. It noted that both Skipjack and US Wind made arguments based on legislative intent in their respective briefs and during oral argument, raising issues that go beyond the pleadings. Therefore, the Motion to Disqualify is better considered as a motion for summary judgment.

The parties may further address the factual and legal arguments raised in the Motion to Disqualify and responses during the evidentiary hearing to be held on 27 October 2021, including opportunities for witness testimony.

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