Will CT catch or miss the boat on offshore wind energy?

Source: By Jan Ellen Spiegel, Connecticut Mirror • Posted: Thursday, March 30, 2017

Deepwater Wind

A “jack-up vessel” installs the final blade on a wind turbine in the Block Island Wind Farm.

Connecticut has a love-hate relationship with wind power. Okay, so far it’s mostly hate.

While wind power is soaring nationally – now accounting for the most renewable generating capacity in the U.S. electric grid – eclipsing hydro for the first time late last year, Connecticut has been a laggard.

There are just a couple of utility-scale turbines in Colebrook – the upshot of citizen opposition followed by a three-year moratorium while siting regulations worked their way through the state’s bureaucracy. Only now is a small amount of wind even being attempted again.

State plans to buy wind power from Maine have been stalled by insufficient transmission capacity to get it here.

But Connecticut still has the potential to become a player in, and economic beneficiary from, wind – offshore wind. And it won’t need to put a single turbine in its own waters, let alone on its own land, to do that.

However the state may need to act quickly, and it may need to put some financial skin in the game to get a piece of what could be very big action.

With offshore wind developers snatching up tracts in federal waters off the Northeast U.S. coast – that’s three miles or more offshore – states from New Jersey to Maine stand to benefit with jobs and shoreline industry, from port staging areas, manufacturing and more.

Connecticut is talking with offshore wind developers about using its ports, according to Connecticut Port Authority Director Evan Matthews and others. But so are most, if not all, of the states in the region, and several of them are far ahead of Connecticut in that process.

“This is always going to be a multi-port solution,” said Matthews, who came to Connecticut last fall from a similar position in Rhode Island, bringing with him contacts in the offshore wind industry he developed through Rhode Island’s first-in-the-nation offshore wind project. “With the amount of projects that are out there, it’s going to take as many port terminals as possible.”

But Massachusetts already has a port facility designed for offshore wind and letters of intent to use it from three wind developers. It and New York already are committed to purchasing, or are in the planning process to purchase, offshore wind power, which some feel will give them a leg up on Connecticut for the economic development associated with offshore wind.

“I don’t think that we are behind,” Matthews said. ”I definitely feel that given Connecticut’s position – it’s well-positioned, and we are open for business.”

Connecticut does have some advantages, but others caution it still needs to get in the game more forcefully.

What’s on the horizon?

Offshore wind has been a staple for decades off northern Europe, which has thousands of megawatts of spinning turbines. But the first U.S. offshore wind project fired up only late last year – a paltry five turbines in Rhode Island state waters off Block Island, providing 30 megawatts, about enough for 30,000 homes.

A lot more is coming, even in the face of President Donald Trump’s recent policy moves favoring fossil fuel use.

Since 2013, 12 commercial leases for wind have been executed in U.S. federal waters off the East Coast by the Bureau of Ocean Energy Management, BOEM (pronounced like Rome), part of the U.S. Department of the Interior.

The areas off New England and New York are considered the biggest prizes

For starters, they’re very windy – widely regarded as having the best offshore wind in the U.S., if not the world. The water is generally shallow, making it easier to sink the massive towers that support the turbines into the ocean floor. The Northeast also has the right economics: It’s densely populated, the grid is congested and therefore in need of relief, and power prices are high. That makes the declining infrastructure cost of offshore wind, with its relatively easy hookup to land, an ideal solution.

U.S. Department of the Interior. Offshore wind tracts leased in New England and the mid-Atlantic.

And importantly – you probably won’t be able to see the turbines from land. The prospect that you could see them all-but-doomed the ambitious 130-turbine Cape Wind project off Cape Cod and Martha’s Vineyard proposed some 15 years ago.

Also nothing we are talking about here involves wind power in Long Island Sound. The waters of the Sound are controlled by Connecticut and New York state, not the federal government. For multiple reasons, not the least of which is that it’s not windy enough, the Sound is not suited to wind power. There are just about zero odds of ever seeing turbines there.

In addition to the Block Island tract, four areas are leased off New England. Two are controlled by Deepwater Wind – which built the Block Island project. One is called Vineyard Wind – owned by Copenhagen Infrastructure Partners. And the fourth is Baystate Wind, a 50-50 venture between offshore wind giant DONG – Danish Oil and Natural Gas – and Eversource. All are roughly off the coasts of Massachusetts and Rhode Island.

The most recent lease auctioned in the region was off the south shore of Long Island. An intense 33-round competition resulted in the steep price of $42.5 million, with the winning bid coming from Statoil, a giant Norwegian energy company. It brought to about 600,000 acres – or nearly 1,000 square miles – the lease total in the New England and New York area so far.

And just in the last few weeks, BOEM has received three more unsolicited requests for leases – another off New York and two off Massachusetts. German-based PNE is after all three, and Statoil also is interested in the latter two.

Even with U.S. bases of operation, all offshore wind components and equipment are manufactured in Europe. For the Block Island project, everything had to be shipped to the U.S., and then four ports in Rhode Island were used as staging areas.

Given the potential for hundreds of turbines, even for just the existing New England/New York-area leases, many ports probably will be needed. That’s where Connecticut’s three deepwater ports – New London, New Haven and Bridgeport – come in.

The ports have no overhead restrictions or other barriers that would hamper moving the enormous towers and turbines. New Haven and New London have freight rail access that comes all the way to the docks. In particular the Thames River estuary, with its military-grade operations at the Navy submarine base and at Electric Boat, is always well-dredged and secure.

While all the ports in the region are said to be in the mix, New London is thought to be well positioned in Connecticut. Several people have said that representatives of DONG and Eversource have met with Gov. Dannel P. Malloy’s administration to discuss Connecticut’s potential for offshore wind work.

Neither the governor’s office nor representatives of DONG or Eversource would confirm that. An emailed statement from Malloy spokesman Chris Collibee read in part that Malloy “has been apprised of the emerging partnership between Dong Energy and Eversource regarding potential plans for offshore wind. With that said, this project is still very much in the preliminary stages, and the state is eager to ascertain what the needs will be of such a project as plans develop.”

If offshore wind really takes off, needs other than ports could include manufacturing and other supply chain activities that may move to the U.S. There might even be a call for shipbuilding – to manufacture the specialized jack-up vessels that extend legs to the ocean floor and are literally jacked-up over the water to become construction platforms. Similar ones are built for use in the Gulf of Mexico.

Existing Connecticut industries. such as submarine building and the workforce skilled in it, may turn out to be a perfect match for offshore wind. There already are at least four companies in the state that provide components to the broad wind power supply chain.

Collibee’s statement made note of that: “We believe that Southeastern Connecticut is very well suited to be able to meet such needs. We have a talented workforce, ample available space, and an ideal location for access to the build site in the Atlantic Ocean.”

The statement went on: “We believe that our state is in a very competitive position.”

But some states already have begun workforce training in anticipation of an offshore wind boom. At least three – Massachusetts, New York and Rhode Island – would seem to be ahead of Connecticut for a piece of the action, with Massachusetts clearly first.

Paying to play

The Massachusetts Clean Energy Center – the state’s clean energy economic development arm – outfitted part of the New Bedford Marine Commerce Terminal specifically for construction of the aborted Cape Wind Project. It has double the lifting capacity of normal ports, among other capabilities. While Cape Wind failed, “it also was built for the future,” said Bill White, the center’s director for offshore wind.

Even with the three letters of intent from developers in hand, Massachusetts is getting itself in line for more. “I will tell you that every developer and every major turbine manufacturer and all the major suppliers of offshore wind components are all carefully looking at sites in the Northeast where, if there’s enough of a pipeline, they can move manufacturing over,” White said.

To that end Massachusetts has nearly completed analysis of other potential port and manufacturing areas. It already has a wind-blade testing facility in Charlestown, adjacent to Boston.

New London and its harbor (Photo by JJBers / Creative Commons)

Perhaps most important, it has a policy backbone to support all of it. Last summer, the legislature approved, and Republican Gov. Charlie Baker signed, legislation that requires contracting for 1,600 megawatts of offshore wind power by June 2027. The first solicitation is set for June.

New York also has mandated the purchase of offshore wind – 2,400 megawatts by 2030. The Long Island Power Authority has committed to buying the power from 15 turbines generating 90 megawatts from Deepwater Wind in a part of its lease territory off Montauk, Long Island, to be called South Fork Wind Farm.

Connecticut has no plans for a similar procurement policy in its new Comprehensive Energy Strategy, due out early next month.

Opinions are mixed on whether it should.

“Yes, I want a detailed offshore wind participation plan to be included in the CES,” said Rep. Lonnie Reed, D-Branford, co-chair of the Energy and Technology Committee, responding to questions on email. But she said to force the state’s utilities to buy wind would be “redundant” because both already are involved in offshore wind development. Avangrid won BOEM’s most recent auction off Kitty Hawk, N.C. “They are already motivated to buy what they themselves generate.”

But Bruce Hamilton, director of energy practice at Navigant Research, a global technology clean energy consulting firm, said Connecticut needs to help with the single biggest piece of the offshore wind paradigm – creating demand.

“For Connecticut to play in this game, I think it will have to show some kind of commitment to buy the power,” he said. “That’s their ticket to play, which would then help them to bargain for a share of some of these other, I’ll call them goodies – the ports and the manufacturing and the jobs and the economic development that goes with them.”

Andrew Gohn, Eastern region director for the American Wind Energy Association, the industry’s trade group, said given the expected volume of work, the whole region was likely to benefit regardless of a particular state’s procurement policy.

Connecticut, he said, has a couple of options to show its commitment besides doing what Massachusetts and New York are doing. One is to increase its target for how much renewable power the state is required to buy. Right now 20 percent of power has to come form the cleanest renewables by 2020. The new energy strategy is likely to increase that – known as the Renewable Portfolio Standard – over another few decades.

Gohn also said the structure of a recent three-state procurement competition, in which clean energy developers competed to sell power to Connecticut, Massachusetts and Rhode Island was ideal for offshore wind.

“I would think it would be a great structure to invest in offshore wind energy as well,” he said. “I can tell you that any number of folks were really excited to see that level of collaboration between states, especially in the clean energy procurement sector. It’s been sort of the holy grail for a lot of state policymakers for a long time.”

But the region’s largest collaborative effort aimed specifically at offshore wind development does not include Connecticut.

Other states planning

It’s a multi-state initiative to create a roadmap for offshore wind development in the Northeast and it’s been underway for more than a year. The Clean Energy States Alliance (CESA) is handling the process on behalf of New York, Massachusetts, Rhode Island and Maine. All states in the area had been offered the opportunity to join in 2015. It’s unclear why Connecticut did not.

The various components, due to be released at the end of June, include a “roadmap” itself, cost analyses and long-term market scenarios through 2030, analysis of the potential for building ships for offshore wind, and a detailed jobs and economic analysis of offshore wind’s potential in the region.

Navigant, which is doing some of the research, estimated about a year ago that a large-scale, hypothetical regional offshore wind development of 500 megawatts of offshore wind per year over 20 years could create the equivalent of more than 225,000 direct and indirect jobs and more than $51 billion in investment.

That’s a total of 10,000 megawatts. By comparison, the Millstone Nuclear Power Station is rated at just under 2,100 megawatts.

Val Stori, CESA’s project director, said the economic analysis is looking at the supply chain across 12 categories to figure out where jobs could be and “which can we guarantee to be developed locally.”

If Connecticut is to benefit from this information, she said, it won’t be until some point down the road when other states may again get an opportunity to join the group.

But will that be too late?

“No I don’t think so,” said Peter Shattuck, director of the clean energy initiative and the Massachusetts office of the regional environmental advocacy group Acadia Center. “It’s taking off now, so if Connecticut acts within the next couple of years – the sooner the better … I would say they haven’t missed out yet. But some of the decisions given what other states are doing are going to be made in the near future.”

Reed signaled caution, saying the state should “move at a responsible speed.”

“I found out a long time ago that being the first is not nearly as important as being the best when it comes to crafting customized energy policies that truly benefit Connecticut,” she said.

There are any number of roles Connecticut could play in offshore wind other than buying it and helping to build it. Possibilities include financing through the Connecticut Green Bank, grid and transmission coordination, and research and development. There’s also a school of thought that states should split up roles to keep themselves out of direct competition with each other.

“It’s not a zero-sum game; it’s going to take all of us working together,” said the Port Authority’s Matthews, “There is a very real possibility that we invest zero and we get a lot of this work anyway.

“All of the key developers and their logistics people have my number. I’ve talked to them about our capabilities. We’re definitely not on the outside looking in.”

American Wind Energy Association. Current onshore wind capacity by state in blue. Red dots designate existing wind-related manufacturing.