Monthly Archives: January 2022

A proposal to revamp Massachusetts offshore wind programs is pitting cost-wary Democratic lawmakers against the states Republican governor, who wants to make ocean turbines a centerpiece of climate goals.

Gov. Charlie Baker appeared yesterday before a joint energy committee controlled by state Democrats, to promote what he called a "game-changing" bill for Massachusetts offshore wind industry. Sponsored by Baker himself, the bill aims to bolster the industry and would eliminate an existing requirement that each new offshore wind project be cheaper than the last.

That condition, which kicks in when utilities and the state select project proposals, was put in place by Massachusetts in 2016, when the cost of offshore wind electricity was largely a matter of guesswork. It was intended to protect the public from untenably expensive contracts.

Now, Baker and the bills supporters say the requirement is causing Massachusetts the first U.S. state to contract for offshore wind to lose out to neighbors like New York and New Jersey in the ongoing competition for industry investments.

"Without prompt action, and continued growth and evolution, we lose risking our status and this is something we all talk about as a leader in this space," said Baker yesterday during his appearance before the Legislatures Joint Committee on Telecommunications, Utilities and Energy.

Bakers proposal highlights broader debates about the offshore wind sector, including how laws can affect company behavior and whether the cost of scaling up new technologies is achievable without hurting low-income ratepayers.

The fate of Bakers proposal also could alter the landscape for offshore wind in other parts of the East Coast, supporters say. If the legislation passes and functions as intended, Massachusetts could win new investments in manufacturing that have increasingly flowed toward New York and New Jersey, which have the nations biggest mandates for buying offshore wind power.

The cost of offshore wind is likely to decline as the industry gains size, regardless of state requirements, Baker and other energy officials say. The flexibility to reach slightly more expensive deals would let developers build in creative solutions for transmission and new technologies, like hydrogen and long-duration storage, that could save money or juice progress toward local climate goals, they say.

At least one influential opponent state Sen. Michael Barrett, a Democratic co-chair of the joint committee counters that erasing the price requirement would be unnecessarily risky for Massachusetts ratepayers, however.

"Massachusetts consumers are better off with constraints on project prices," Barrett wrote in a Jan. 10 letter to the governor.

The states climate goals, which include a 50 percent greenhouse gas emissions cut by 2030 and net-zero emissions by 2050, envision a massive shift from gas cars and building heat appliances toward electric technologies, he wrote, making controls on the price of electricity especially important in coming years.

Other Northeastern states have often agreed to pay far more for offshore wind, ranging up to about double the per-kilowatt rate in Massachusetts, Barrett noted in the letter.

The price requirement had been successful in bringing new jobs and investment to the state, Barrett told the governor during the latters appearance before the joint committee yesterday. Baker supported the requirement five years ago, when the economics of offshore wind were far less well-established.

"My hat is doffed to you. But I cant believe that you would want to put us where New York is today by lifting the cap altogether, or putting us where, God forbid, New Jersey or Connecticut ratepayers are today," said Barrett.

"We cant depend on market competition to substitute for a price cap as a protection for Massachusetts consumers," he said.

Known as "An Act to Power Massachusetts Clean Energy Economy," the bills odds of passage are unclear, although the governor has important allies for his proposal. The state Houses Democratic speaker, Ron Mariano, has backed the plan, along with offshore wind developers and environmental groups like the Sierra Club and Environment Massachusetts.

The bill also includes other features that may attract Democratic legislators, like the launch of a new $750 million fund for innovative clean energy technologies, in part using federal money from last years American Rescue Plan stimulus package. Separately, it would shift some decisionmaking power over offshore wind contracts from the utilities toward the state executive branchs energy authority.

The legislations clean energy fund could also open a new path for Massachusetts as it seeks to meet its climate goals, if it works according to the governors vision.

Lifting the price requirement, Baker argued yesterday, could free up Massachusetts to settle on deals that pair offshore wind with next-generation technologies that would provide 24/7 sources of clean energy, like hydrogen and long-duration energy storage.

"Im one of these people who really does believe that if we actually figure out storage and turn offshore wind and solar into a hard, completely reliable and dependable [solution] strategically, it changes kind of everything with respect to the way we think about some of this stuff," said Baker.

Such "firm" resources would mark a change from current energy transition plans in Massachusetts, which has counted on Canadian hydropower as a round-the-clock substitute for oil and gas. But neighboring states have repeatedly rejected the huge transmission lines that would transport the hydropower into Massachusetts.

"The power of innovation, in this space, may be much bigger than we realize," said Baker.

The debate also shone a light on the recent consolidation of the offshore wind sector, a phenomenon that could shape clean energy goals in unforeseen ways.

In 2018, for instance, 11 developers submitted formal bids to the Interior Department for three federal lease areas off the coast of Massachusetts.

In 2021, just two offshore wind project proposals were submitted to Massachusetts, which was awarding the rights to produce the power. In the end, both competitors won project rights.

Two major developers, rsted and Equinor, decided to sit out the state solicitation. In a statement to E&E News, spokespeople for rsted and its utility partner, Eversource, attributed their absence to the price requirement, saying it "impacted our ability to accomplish" objectives like investing in the local supply chain. "We look forward to future reforms that will help us achieve these goals," the companies wrote.

During the governors appearance before the Massachusetts committee, however, Barrett noted that only a slightly larger handful of developers were leading offshore wind investments in Northeastern states.

"Unfortunately, at the moment, with or without a price cap, the entire upper East Coast has attracted very few players, and thats a sobering thing to think about," Barrett told the governor.

One version of a compromise, Barrett suggested, might involve removing transmission solutions from the price requirements, rather than abandoning the latter entirely.

"I ask you if there is grounds here for compromise," he said. "Can we find our way to some measured outcome here, rather than rolling the dice, as New York, New Jersey and Connecticut have done?"

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How much should offshore wind cost? Look to Massachusetts - E&E News

The Biden administration today announced a blockbuster wind sale in the waters off New York, alongside a bundle of clean energy initiatives aimed at speeding up renewable deployment and modernizing the countrys aging and vulnerable electricity grid.

The efforts include $20 billion in grid funding from the Department of Energy, a rural renewables pilot program from the Department of Agriculture and a multiagency collaboration to advance onshore solar, wind and geothermal energy projects.

In addition, the Interior Department next month will hold an offshore wind lease sale in a shallow-water region off the coasts of New York and New Jersey called the New York Bight.

This is the first lease sale for the Biden administration, which has already committed to rapidly expanding the fledgling offshore wind industry in the United States. The White House plans to deploy 30 gigawatts of offshore wind power by 2030, part of the larger push to zero out carbon emissions from the U.S. electricity sector.

The New York Bight lease area alone could support enough offshore wind to power 2 million homes.

We are at an inflection point for domestic offshore wind energy development. We must seize this moment and we must do it together, Interior Secretary Deb Haaland said in a statement.

To support the massive growth of renewables anticipated by the Biden administration, the Department of Energy also announced today the launch of an initiative to deploy funding to accelerate grid improvements.

The foundation of our climate and clean energy goals is a safe, reliable, and resilient electric grid that is planned hand-in-hand with community partners and industry stakeholders, said Energy Secretary Jennifer Granholm in a statement.

Granholm said the initiative would be a job booster to upgrade the nations grid, connect more Americans to clean electricity and broadband, and reliably move clean energy to where its needed most.

A senior White House official said in a briefing last night that the grid efforts would be crucial to meeting Bidens goal of reaching 100 percent carbon emissions-free electricity in the United States by midcentury, but they also respond to the need to prepare an aging grid in the face of climate change.

Extreme weather events like the Dixie wildfire, Hurricane Ida and the 2021 Texas [grid] freeze have been made it clear that our existing energy infrastructure will not endure accelerating impacts of extreme weather spurred by climate change, said the official, who spoke with reporters on the condition of anonymity.

He added: On top of that, the queue of projects waiting to connect to the grid, both clean generation projects as well as electricity storage projects, theyre looking for interconnection.

Biden administration officials also hinted at the need for greater action through Congress, where a reconciliation package filled with clean energy and climate-focused spending stalled shortly before the New Year.

Sen. Tom Carper (D-Del.) today echoed the need for that legislation to move forward, while praising Bidens renewable initiatives.

Meeting our climate goals requires a well-coordinated approach across the U.S. economy one that taps into American ingenuity and harnesses our most abundant resources, including the wind that blows off our coasts, he said in a statement. Its time for Congress to do our part. We must pass the clean energy investments in Build Back Better Act and truly unleash our nations clean energy future.

The clean energy announcements pleased environmental groups in many respects but also spurred some criticism that renewable deployment isnt paired with dramatically curbing fossil fuel emissions.

The progress this administration has made to advance offshore wind and other renewable energy deployment is a valuable asset to a national climate strategy, said Chase Huntley, the Wilderness Societys vice president of strategy. But the administration needs to be turning all the knobs as far as they can for the sake of climate, especially on public lands.

The New York Bight lease sale on Feb. 23 will offer 480,000 acres to offshore wind developers. It is the largest single lease offering to date in the United States.

Amanda Lefton, director of the Bureau of Ocean Energy Management, noted in a call with reporters today that the sale also shows that the administration is working with other ocean users, like fishermen.

Criticism from fishermen has been a long-standing hindrance for offshore wind developers and the federal agencies promoting offshore wind deployment.

But Lefton noted that BOEM removed more than 70 percent of the area considered for the sale to respect environmental concerns and other ocean users. She stressed that fishermen should be involved from the beginning of the process of wind development.

The administration has also built-in several provisions to tie the outcome of this sale to its clean energy and jobs goals, such as including measures meant to encourage developers to bundle union labor commitments into their bids.

The leases will also offer financial incentives for project proposals that will use turbine blades and other offshore wind components that are manufactured in the United States.

The announcement of the sale drew praise from industry groups that have been pushing for the New York Bight lease sale for years.

With their large economies and massive populations, New York and New Jersey are two coastal states critical to the development of American offshore wind, Erik Milito, president of the National Ocean Industries Association, said in a statement, also noting that the economic benefits of this sale will cascade outside of the New York region.

We are just scratching the surface of what American offshore wind will achieve, he said.

Interior also announced today a new working group among BOEM, New York and New Jersey to collaborate on supply chain growth, job creation and other shared issues.

The two states have set some of the most ambitious targets in the country to procure offshore wind power and helped drive the growth of the industry in the United States.

New Jersey is already committed to creating nearly one-quarter of the nations offshore wind-generation market, Gov. Phil Murphy (D) said in a statement. By acting on this shared vision, we can promote our joint offshore wind goals, and deliver benefits to residents of both states, particularly those in overburdened communities.

New York Gov. Kathy Hochul (D), who recently announced a $500 million state investment in offshore wind, said growing a clean energy economy will take collaboration at all levels.

We must chart an ambitious path toward a cleaner energy economy now more than ever, and todays milestone further highlights New Yorks commitment creating a greener tomorrow, she said.

Other aspects of the clean energy rollout today include an agreement between NOAA Fisheries and Interior to collaborate on offshore wind.

Meanwhile, DOE will also be releasing a report identifying priorities for offshore wind growth, like grid development, improved permitting processes and supply chain expansion, according to a fact sheet released by the White House.

The Department of Energy today disclosed its targeted strategy to channel more than $20 billion in funding to secure construction of major high-voltage transmission line projects that link prime sources of wind and solar energy to population centers.

Transmission is critical to addressing the climate crisis through the decarbonization of the power sector and electrification of transportation and other sectors, DOE said in a notice of intent on the program.

DOEs statement also called transmission grid expansion a critical security investment: Modernizing and expanding the nations electric transmission grid will improve the reliability and resilience of electricity delivery in the face of extreme weather and supply disruptions; unlock access to cleaner, lower-cost energy for consumers and businesses; and create good-paying American jobs.

DOE said it will develop a national blueprint for transmission lines that help states achieve clean energy goals and strengthen power facilities against increasingly severe extreme weather assaults. A top priority, DOE said, is managing the distribution of thousands of megawatts of new power supplies coming into Atlantic states from offshore wind farms.

According to DOE, the plan seeks to overcome planning, funding and siting roadblocks that have effectively blocked large-scale power line projects in the United States for several decades. The notice includes the first details on how DOE, working with the Federal Energy Regulatory Commission, plans to use the authority in the infrastructure law to designate national corridors where federal agencies and transmission developers could focus top priority project development. DOEs collaboration with developers can entail the design, development, construction, operation, maintenance, or ownership of a project, the notice said.

Where necessary, DOE will become an anchor customer on new or upgraded transmission lines, buying up to 50 percent of a lines power deliveries for up to 40 years, to ensure upfront financing of top priority projects. Once a project is fully funded, DOE would market its capacity to private parties.

Using new authority in the federal infrastructure law, DOE would team up with transmission line developers and with federal and state agencies including the Interior Department and the Forest Service to create rights of way for major power line projects. Existing rail and highway rights of way could be included in the new transmission paths, DOE said.

Timetables for carrying out the new policies are still being developed, DOE said.

The Biden administrations agencies are also signing on to a memorandum of understanding to coordinate and rapidly roll out clean energy projects onshore.

Though the announcement was sparse on details, this would include collaboration among the departments of the Interior, Agriculture, Energy and Defense and EPA.

"To reach a carbon-free electricity sector by 2035, the United States has to streamline the permitting process to deploy more renewable energy projects," said Deputy Secretary of Energy David Turk in a statement. "This Memorandum of Understanding between the U.S. Departments of the Interior, Agriculture, Defense, Energy, and the Environmental Protection Agency will prioritize and expedite permitting decisions, create new jobs, and protect our Nations diverse land."

Streamlining the permitting process for energy projects has long been a concern for industries, both fossil fuel-based and nontraditional. But accelerated federal review has also often raised the ire of environmental groups that fear public input and environmental concerns will take a back seat to efficiency.

That conflict was particularly heated during the Trump administrations push to tighten the timeline of environmental reviews for energy projects on public lands.

At last nights press briefing, the senior White House official said that the Biden agency collaboration would not reduce the environmental review process.

This is not about curbing any review; its about making more robust our ability to partner with folks who want to harness this clean energy on public lands, he said.

Some conservation policy groups praised the administrations efforts today.

Christy Goldfuss, senior vice president for energy and environment policy at the left-leaning Center for American Progress, said Bidens efforts will modernize the electric grid and fuel economic growth.

The largest offshore lease sale to date will keep and create good union jobs, she said. Expediting clean energy deployment onshore will ensure that our public lands help tackle climate change rather than contribute to it. These are the benefits of taking climate action that can support communities across the country.

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Biden admin to hold huge offshore wind sale, modernize grid - E&E News

The Interior Department today advanced reviews of how offshore wind farms could affect the Gulf of Mexico and the northern Pacific Ocean, paving the way for the burgeoning industry to extend to the major coastal regions.

The Bureau of Ocean Energy Management (BOEM) announced it will study roughly 30 million acres of ocean, extending from Louisiana along the Texas coast to the Mexican border, for potential wind energy development.

The bureau, which manages offshore energy leasing, also released a draft assessment today of offshore wind impacts in roughly 206 square miles off the coast of Northern California known as the Humboldt Wind Energy Area.

The studies lay the groundwork for advancing offshore wind projects in federal waters: BOEM assesses potential offshore wind activities like seismic surveys and construction against resources that may need protections like marine habitats and archaeological sites.

In the Gulf of Mexico, the environmental reviews will help the federal government define what areas can best support offshore wind arrays, with the least impacts to other industries, marine life and the environment.

BOEM Director Amanda Lefton said the Gulf review will help ensure that any development in the region is done responsibly and in a way that avoids, reduces or mitigates potential impacts to the ocean and to ocean users.

If Interior establishes specific wind energy areas in the Gulf, it could then hold lease auctions, enticing developers to compete for rights to build offshore wind farms.

The process in California is further along. With the Humboldt Wind Energy Area already determined, BOEMs next step after finalizing its draft review would be to hold a lease sale. Its accepting public comments on the draft for 30 days.

The Humboldt energy area could support up to 1.6 gigawatts of offshore wind energy, enough to power half a million homes.

If Interior holds offshore wind lease sales in two regions, developers also would face another round of environmental review specific to their proposed project before BOEM would grant the right to build.

The Biden administration has committed to greatly expanding the offshore wind sector in the U.S., a nascent market with just two pilot projects currently operating. The administration aims to approve 16 full-scale offshore wind farms by the end of the presidents first term.

Some Gulf political leaders, like Louisiana Gov. John Bel Edwards (D), have also voiced support for offshore wind, which could blend with the existing offshore oil and gas sector in the Gulf of Mexico, relying on its workforce and offshore expertise.

For the Biden administration, this blending is about supporting a shift away from fossil fuel development.

The Gulf of Mexico is well-positioned to support a transition to a renewable energy future, as much of the infrastructure already exists to support offshore wind development in the region, Lefton said in a statement.

California political leaders also support the industry growing there. Last May, the Biden administration announced it had reached an agreement with state leaders on deploying offshore wind in the Pacific Ocean (E&E News PM, May 25, 2021).

The potential impacts of a growing offshore wind sector have become a concern for fishermen in the Northeast, where the first wind farms will be built.

Just today, the Responsible Offshore Development Alliance, a fishermens group, published recommendations for BOEM to strengthen mitigation measures and work closely with fishermen when considering offshore wind development.

Commercial fishermen should be considered partners and be meaningfully engaged throughout the process with a reasonable expectation of informing the result, said Eric Brazer, deputy director of the Gulf of Mexico Reef Fish Shareholders Alliance in Galveston, Texas.

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Biden admin advances Gulf and Calif. offshore wind reviews - E&E News