New England Offshore Wind Update
While New England's first two offshore wind projects, Cape Wind and the Block Island Wind Farm, await the outcome of key appeals, initiatives to lease sites off of Rhode Island and Massachusetts moved forward as federal efforts to streamline the permitting effort began to take shape. Meanwhile, Maine released a feasibility study of a floating offshore wind industry in the Gulf of Maine and took steps toward the first development activities.
DOE and DOI Announce National Offshore Wind Strategy
The Obama Administration announced major new initiatives this winter to boost offshore wind.
Smart from the Start Initiative
In November, the Department of Interior (DOI) launched its Smart from the Start wind energy initiative implemented by the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE). This initiative is identifying appropriate designated areas for siting, coordinated environmental studies, large-scale planning, and expedited approval processes to speed offshore wind energy development. Smart from the Start includes the following components:
- BOEMRE will help states identify Wind Energy Areas in federal waters that are appropriate for leasing where conflicts with existing uses can be minimized.
- BOEMRE will issue requests for information inviting site nominations and environmental comments for the Wind Energy Areas designated.
- BOEMRE issued a new rule change to streamline the permitting process where a determination of "no competitive interest" is made, potentially eliminating 6 to 12 months from a project's permitting timeline.
A National Offshore Wind Strategy
In February 2011, the DOI and Department of Energy (DOE) announced A National Offshore Wind Strategy (PDF 1.4 MB), including new funding opportunities. Under the National Offshore Wind Strategy, DOE is pursuing a scenario that includes deployment of 10 gigawatts of offshore wind generating capacity by 2020 and 54 gigawatts by 2030. Those ambitious scenarios include development in both federal and state offshore areas, including along Atlantic, Pacific, and Gulf coasts as well as in the Great Lakes and Hawaiian waters.
As part of this strategy, the DOE Wind and Water Power Program issued three competitive solicitations, representing up to $50.5 million over 5 years, to develop breakthrough offshore wind energy technology and to reduce specific market barriers to its deployment:
- Technology Development (up to $25 million over 5 years): DOE will support the development of innovative wind turbine design tools and hardware to provide the foundation for a cost-competitive and world-class offshore wind industry in the United States. Specific activities will include the development of open-source computational tools, system-optimized offshore wind plant concept studies, and coupled turbine rotor and control systems to optimize next-generation offshore wind systems.
- Removing Market Barriers (up to $18 million over 3 years): DOE will support baseline studies and targeted environmental research to characterize key industry sectors and factors limiting the deployment of offshore wind. Specific activities will include offshore wind market and economic analysis; environmental risk reduction; manufacturing and supply chain development; transmission planning and interconnection strategies; optimized infrastructure and operations; and wind resource characterization.
- Next-Generation Drivetrain (up to $7.5 million over 3 years): DOE will fund the development and refinement of next-generation designs for wind turbine drivetrains, a core technology required for cost-effective offshore wind power.
Proposals for these solicitations are currently being reviewed by DOE.
Identifying Offshore Wind Energy Areas
In addition to DOE's competitive solicitations, the DOI consulted with task forces of state officials and identified Wind Energy Areas offshore Delaware (122 square nautical miles), Maryland (207), New Jersey (417), and Virginia (165) and issued a Notice of Intent to conduct environmental assessments before issuing leases for site assessment and site characterization studies there.
Based on stakeholder and public participation, BOEMRE will prepare regional environmental assessments for Wind Energy Areas to evaluate the effects of leasing and site assessment activities on leased areas. If no significant impacts are identified, BOEMRE could offer leases in these mid-Atlantic areas as early as the end of 2011 or early 2012. Comprehensive site-specific National Environmental Policy Act (NEPA) review will still need to be conducted for the construction of any individual wind power facility, and BOEMRE will work directly with project managers to ensure that those reviews take place on aggressive schedules.
In the near future, BOEMRE hopes to announce Wind Energy Areas off of North Atlantic states, including Massachusetts and Rhode Island, and launch additional environmental assessments for those areas. BOEMRE has convened several joint meetings of the Massachusetts and Rhode Island Offshore Renewable Energy Task Forces to discuss the areas to be leased off Massachusetts and Rhode Island. An initial meeting was held on December 10, 2010 at Roger Williams University in Bristol, Rhode Island.
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Leasing Offshore Lands off Massachusetts and Rhode Island
Prior to seeking proposals for leases in Federal waters off of Massachusetts and Rhode Island, BOEMRE received two unsolicited applications for leases (PDF 1.8 MB) in Rhode Island Sound in the area of mutual interest off Massachusetts and Rhode Island. Deepwater Wind New England LLC proposed a 200-turbine, 1,000-MW Deepwater Wind Energy Center in Rhode Island Sound that would interconnect by submarine cables to multiple locations in New England and Long Island.
In addition, Neptune Wind LLC also proposed a project in Rhode Island Sound. Subsequently, Neptune Wind announced that it had submitted two additional Expressions of Interest for offshore wind leases in federal waters off Massachusetts.
Based on the receipt of numerous bids in the subsequent Request for Interest (described below), some of which overlap the blocks designated by these unsolicited bids, a competitive auction process is likely to be triggered, potentially adding a year to the leasing process relative to an uncontested lease.
In December 2010, BOEMRE issued a Request for Interest (RFI) inviting bids and comments on leasing submerged federal lands at least 12 miles south of Martha's Vineyard and Nantucket Islands. The RFI area was identified by a task force of federal agency representatives, Massachusetts and Rhode Island state officials, and BOEMRE staff. Comments on environmental concerns are also invited. If there is no geographic overlap for specific nominated sites, BOEMRE will release of a call for information on the specific site for further public comment before a final determination of no competitive interest. Before BOEMRE may issue a lease, the developer must submit a site assessment plan and undergo a NEPA review.
Nominations for specific 9 nautical square mile lease blocks were due February 28, 2011, but extended into April at the request of local fishermen concerned about infringement on their fishing grounds. On April 19, the Governor's office in Massachusetts issued a request to BOEMRE to alter the area of the blocks by removing certain areas identified by commercial fishermen, fisheries scientists, and other maritime users as vital to the state's fishing industry. The request was to remove from the federal leasing process approximately half of the 3,000 square mile area in federal waters south of Massachusetts originally identified by BOEMRE. Among the territory exempted from consideration were shipping lanes and waters on the eastern side of the original lease area important to the fishing industry. On May 2, BOEMRE approved the state's request and reduced the size of the lease area by roughly half. Ten companies have submitted 11 indications of interest to develop offshore wind farms in the area, and the proposals are expected to be released soon. The companies are Condor Wind Energy LLC, Energy Management Inc. (parent company of Cape Wind Associates LLC), Fishermen's Energy LLC, Free Flow Power Corp., Iberdrola Renewables Inc., Neptune Wind LLC, No Fossil Fuel LLC, NRG Bluewater Wind Massachusetts LLC, Offshore MW LLC (which also includes a partnership with Vineyard Power called the Martha's Vineyard Offshore Wind Alliance), and US Wind Inc. A list of the companies and proposed development blocks (PDF 37 KB) is available.
The Federal Register notice for Massachusetts (PDF 177 KB) is available.
The map of the eligible lease blocks (PDF 477 KB) is available.
Although the Massachusetts Ocean Management Plan released a year ago designated two large areas in state waters south and southwest of Martha's Vineyard, opposition from Martha's Vineyard due to visual impacts less than 10 miles from shore has delayed the proposed state-sponsored auction for those sites.
BOEMRE has indicated that a Wind Energy Area will be identified for Rhode Island after consultation with federal and state officials leading to an RFI for Rhode Island for the area just south of the Massachusetts RFI lease blocks.
BOEMRE plans to conduct a regional environmental assessment for Rhode Island Sound to cover the Rhode Island and Massachusetts areas, which is likely to rely heavily on the Rhode Island Ocean Special Area Management Plan for Rhode Island Sound, recently completed after a 3-year stakeholder process. If there is competition for any nominated offshore sites in Massachusetts or Rhode Island, BOEMRE must design and implement a competitive auction process for the site. After receiving a lease, the developer must then initiate a multi-year survey and permitting process, including a full Environmental Impact Statement before the final lease is issued with conditions for commencing construction.
For more information, see the BOEMRE State Activities website.
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Project Development Activity
On April 19, Secretary of the Interior Ken Salazar announced BOEMRE approved a construction and operations plan submitted for the Cape Wind Energy Project, granting the project the final federal permit needed for construction. Construction could start as early as this fall. However, despite announcing the completion of its permitting process, Cape Wind opponents continue to appeal various environmental approvals in federal courts. In addition, Cape Wind continues to seek additional contracts for power beyond the 15-year, 234-MW contract with National Grid recently approved by the Massachusetts Department of Public Utilities. That contract, whose price starts at 18.7¢ per KWh and escalates over time, is under appeal at the Massachusetts Supreme Judicial Court. National Grid's initial contract would fulfill their mandated requirement to sign renewable contracts for 3% of their load under the 2008 Green Communities Act. Senator Kerry and the entire Massachusetts Congressional Delegation asked DOE to approve the federal loan guarantee to facilitate project financing. In May, DOE announced that it would not be moving forward with a loan guarantee for Cape Wind this fiscal year.
Deepwater Wind LLC was selected by the state of Rhode Island in a competitive process to develop a small (eight-turbine, 28.8-MW) wind farm off Block Island and transmit the power through Block Island to the mainland. Deepwater negotiated a contract for the pilot-scale Block Island Wind Farm with National Grid, which was originally rejected by the Rhode Island Department of Public Utilities. However, after new legislation revised the standard of review, the RIPUC in August 2010 approved the revised contract, which provides for a price of 24.4¢ per KWh, escalating over time. The RIPUC approval is now under appeal at the state Supreme Court.
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Maine Offshore Deepwater Floating Turbine RFP
The University of Maine's (UMaine) Advanced Structures and Composites Center and the DeepCwind Consortium released the 4-year Offshore Wind Feasibility Study examining every facet of deepwater offshore wind technology and supply chain. The 557-page report concludes that deepwater offshore wind could be produced at 8¢ to 10¢ per KWh within 10 years by constructing floating turbines in dry dock and then towing them offshore to be anchored in deep water.
Funded by more than $1 million from the DOE and compiled by UMaine and the James W. Sewall Co., the report examines economics and policy, electrical grid integration, and wind, wave, soil, and environmental research. It also includes summaries of assembly and construction sites, critical issues for project development and permitting.
The report consists of the compilation and preliminary analysis of relevant data on the Gulf of Maine to provide information for parties seeking to respond to an RFP for a 30-MW deepwater offshore wind project that was released in September 2010 by the Maine Public Utilities Commission (PUC).
The RFP calls for bidders to propose the sale of renewable energy produced by a deepwater offshore wind energy pilot project that employs one or more floating turbines in the Gulf of Maine at a location 300 feet or greater in depth no less than 10 nautical miles from any land area. The RFP also includes a tidal energy demonstration project up to 5 MW.
Pursuant to legislation last year, the PUC may authorize one or more long-term contracts for an aggregate total of no more than 30 MW of installed capacity (along with associated energy and renewable energy credits) from deepwater offshore wind energy pilot projects or tidal energy demonstration projects (5 MW maximum aggregate for tidal).
With $12 million in funding from the DOE, UMaine has undertaken a multi-year program focused on the development and testing of floating offshore wind energy platforms. As part of this program, UMaine has led an evaluation of more than 14 different platform technologies submitted by designers from around the world. Beginning this year, the first of these platform concepts will be designed at an intermediate (approximately one-third) scale to carry a 100-kW turbine.
This first intermediate-scale platform is expected to be fabricated and deployed into UMaine's Deepwater Wind Test Site off Monhegan Island in July 2012, for a period of approximately 3 to 4 months. Performance data will be gathered during this deployment and will be used to refine the design for potential full-scale development.
UMaine is currently developing plans to build and deploy additional intermediate-scale platforms in 2013 and 2014 to evaluate other platform technologies, validate numerical models and study the interaction of the platforms with the environment. The university will then share this information with the selected bidder in support of the development of a 100+MW deepwater wind farm. For more information, see the DeepCwind Consortium website.
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This information was last updated on 6/3/2011