Despite Obama move to cut ‘red tape,’ proposed Great Lakes wind farms are still snarled in it

Source: Daniel Cusick, E&E reporter • Posted: Tuesday, April 10, 2012

Obama administration officials last week effectively opened a new frontier in U.S. wind energy development by clearing a permitting path for energy firms to build wind farms in the Great Lakes.

White House Council on Environmental Quality Chairwoman Nancy Sutley described the new agreement between the federal government and five states as an effort to “cut through the red tape” of permitting offshore wind energy projects. Doing so, she said, would allow Illinois, Michigan, Minnesota, New York and Pennsylvania to begin harvesting some of the estimated 700 gigawatts of electricity bound up in their offshore winds.

But what Sutley and her administration colleagues failed to note is that there are varying opinions about the best way to develop wind energy in freshwater environments like the Great Lakes, or even whether such projects should be approved at all.

The U.S. agreement also overlooked the policy of Ontario, which owns more Great Lakes shoreline than seven of the eight U.S. Great Lakes states combined.

In February 2011, Ontario’s Ministry of the Environment imposed a moratorium on offshore wind farms in its part of the Great Lakes, citing the need for more research into the impacts of wind turbines on the marine environment as well as to wildlife like birds and bats that may fly into spinning blades.

In announcing its decision, Ontario officials put off potentially hundreds of millions of dollars in renewable energy investment made possible under the province’s Green Energy and Green Economy Act, which offered generous feed-in tariffs to developers of renewable energy like wind farms.

Still, the agency, for the second time this decade, determined that too many questions remained unanswered about offshore wind. An earlier moratorium had been in place from 2006 to 2008.

“Offshore wind in freshwater lakes is early in development, and there are no projects operating in North America,” the ministry said, noting that only one other known freshwater wind farm — on Sweden’s Lake Vanern — had been built, and another pilot project in Lake Erie off Ohio remained in the planning stages.

Tangle of state and federal jurisdictions

In the United States, permitting responsibility for offshore energy facilities is divided among multiple agencies, including the departments of Homeland Security and the Interior, U.S. EPA, and the Army Corps of Engineers.

But states are also actively pursuing their own offshore policies. Among the Great Lakes states, Ohio has led the charge, with the Ohio Department of Development working in conjunction with the Ohio Energy Office and the Ohio Department of Natural Resources to develop wind energy resources on Lake Erie.

Draft rules for the siting and operation of wind power facilities on Lake Erie are under review before the Ohio Office of Coastal Management.

Ohio officials say that Lake Erie, as the shallowest and southernmost of the Great Lakes, has a unique opportunity to develop offshore wind energy that could be consumed locally in load centers like Detroit and Cleveland but also could be routed to the two major electricity grids serving the region.

But to date, only one wind facility has been proposed on any of the U.S. Great Lakes, by Cleveland-based Lake Erie Energy Development Corp. (LEEDCo), a nonprofit representing both public and private interests. LEEDCo’s pilot project, dubbed “Icebreaker,” would place turbines atop five to seven 300-foot towers about 7 miles off the Cuyahoga County shoreline east of Cleveland.

LEEDCo President Lorry Wagner said recently that the agreement “changes the landscape” and should prove beneficial to the company when it files its permit applications to begin work on its 20- to 30-megawatt project in 2014 (Greenwire, March 30).

Another project that remains in the conceptual phase, and has not yet sought state or federal permits, is Lake Erie Alternative Power LLC’s 2,500 MW offshore wind power proposal for Lake Erie, which calls for installing up to 700 turbines in offshore areas of Ohio, Pennsylvania and New York, according to the firm’s website.

Jeffrey DiLaura, CEO of the Malvern, Pa.-based firm, said yesterday that his project remains in the pre-construction phase, in part due to difficulties he’s had negotiating lease terms with the three states that have jurisdiction over his preferred project site, which extends across more than 1,500 square nautical miles.

“If the Obama administration and the states really wanted wind [energy], they could open up a number of avenues for us,” DiLaura said. “What they’re talking about is an excellent first step. But it’s not enough.”

For commercial-scale wind power to succeed in the offshore Great Lakes, DiLaura said, the states and federal government should form an interstate commission that would have broad regulatory oversight of siting, leasing and permitting of such facilities.

“Obama’s new [policy] is great in that it will help bypass some of the permitting hurdles,” he added, “but these other issues still need to be rectified.”

Litigation and political wrangles in Canada

The Obama administration policy push may also garner a cool reception in Canada, where the Ontario government is being battered for its wind energy policies both onshore and offshore.

While some rural Ontarians have protested the provincial government’s pro-growth policies for onshore wind farms, saying the turbines are eroding quality of life for thousands of Ontario farmers, the government is also being sued for its conservative stance on offshore wind power (ClimateWire, Feb. 5).

Last month, the provincial government was hit with a $1.2 billion lawsuit from energy developer SouthPoint Wind of Leamington, Ontario, which alleges the moratorium on offshore wind turbines has caused undue hardship for the family-owned company.

A lawyer for SouthPoint told the Windsor Star newspaper that the company had negotiated with the government since 2004 to construct three wind farms in Lake Erie off Leamington, Kingsville and Union, and that by virtue of its early action, the company had been granted special status as the “applicant of record” in those areas.

But the 2011 moratorium effectively stripped SouthPoint of its preferred status, leaving the company without a development site and rendering all of its previous site work, including environmental studies, moot, according to the complaint filed in the Ontario Superior Court of Justice in Windsor.

In addition to $1 billion in direct compensation, the SouthPoint lawsuit asks for $100 million in punitive damages and another $100 million to penalize the Ontario government for bad-faith negotiations.

Meanwhile, Ontario officials must decide whether its ban on offshore wind farms will remain in place if firms on the U.S. side of the border begin siting turbines off Chicago, Detroit, Milwaukee, Cleveland and Buffalo, N.Y.

Kate Jordan, a spokeswoman for the Ministry of the Environment, said in an email that there was no immediate plan to consider lifting the moratorium and that “Ontario will collaborate and share research with other jurisdictions to ensure we continue to base renewable energy development on sound science.”

A White House CEQ official, speaking on background, said that although Ontario was not consulted on the five-state permitting agreement, the Obama administration would continue working with Canada on cross-boundary energy issues, including wind power development.

Permitting will be ‘complex,’ Army Corps says

U.S. officials said last week that there are no applications currently before a federal agency to build an offshore wind farm on the Great Lakes, nor did they identify any proposals at the state level beyond LEEDCo’s pilot project for Lake Erie.

But the Army Corps of Engineers, in a March 20 fact sheet, noted that pre-application discussions have occurred between the corps’ Buffalo District Office and several wind power developers, including the New York Power Authority, LEEDCo and Lake Erie Alternative Power.

The corps said that utility-scale offshore wind farms have been under discussion for several years, and that initial findings from those meetings were that Lake Erie, particularly in Ohio, “might be the likely location for the first of these projects, due to lake morphology, wind resource and proximity to large population centers.”

But permitting such projects will be complex, the corps said, citing potential impacts to migratory birds and bats as well as concerns about “shifts in littoral/wave action processes, difficulties due to ice flows and currents, impacts to air traffic/radar capabilities, acoustic disturbances to aquatic species, potential shipping disruptions and aesthetic concerns for onshore residents.”

Other experts said the impacts from offshore wind turbines will be primarily limited to bird and bat mortality, as well as possible disturbances to subsurface species from the driving of pilings for turbine towers into the lake bottoms.

Willett Kempton, a professor of marine policy at the University of Delaware who has studied offshore wind farms in Europe and on the Atlantic Coast, said such concerns can be mitigated with careful siting of turbines and other safeguards to protect species, such as avoiding pile-driving during certain seasons of the year.

“We’ve reviewed a tremendous amount of this stuff on what wind turbines can do, and it all boils down to birds,” said Kempton, who is also director of research and external affairs for the university’s Center for Carbon-free Power Integration. “If you put up a big wind turbine, you’re going to kill some birds.

“But you have to consider how many birds are saved by displacing that amount of power [from fossil-fuel energy sources] — because when you make power without making pollution, you’re reducing human deaths and wildlife deaths.”