The Future of Offshore Wind on Delmarva Could be in Question - WBOC TV 16
The Future of Offshore Wind on Delmarva Could be in Question | Latest News | wboc.com
OCEAN CITY, Md. -- US Wind and Orsted are both working to bring wind energy to the East Coast. Orsted, a Danish company, has pulled the plug on a few projects amid big losses.
It has raised questions about the industry's future. On Wednesday, Orsted scrapped two projects it had planned for New Jersey. Those projects were Ocean Wind 1 and Ocean Wind 2.
What does that mean for us here on Delmarva? Orsted said its Skipjack project, which would place turbines around the border of Maryland and Delaware is still moving forward.
According to the New York Times, the Danish company was facing billions of dollars in losses in the New Jersey projects. The companies CEO worried the losses were only going to get worse. So, the company pulled out.
The Skipjack project is still in the early stages of federal approval. The Bureau of Ocean Energy Management is assessing a site plan off the coast of Delaware. It means there are still a lot of boxes to check before Orsted could get the 'go-ahead' from the feds.
In light of the recent news, if that day never comes, Ocean City leaders won't be too upset.
"We would like the projects moved further offshore," said Terry McGean, Ocean City's City Manager. "If that's unable to occur then we would prefer the projects not happen at all."
Orsted told WBOC they remain committed and in a statement said:
"Orsted continues to develop Skipjack and expect to have more clarity on its path forward as we continue discussions with stakeholders in Maryland and Delaware."
There are people like Mike Dunn with the Greater Salisbury Committee who hope Orsted can get its project off the ground.
"First and foremost it's clean energy, right, and it's providing energy for hundreds of thousands of homes," said Dunn. "But as importantly, it's jobs."
Dunn said locally we have an offshore training facility, Arcon, companies like Crystal Steel in Federalsburg that will be building turbines and operations and maintenance facilities in West Ocean City.
While there could be a number of benefits to offshore wind on Delmarva, Dunn said the recently scrapped projects in New Jersey are a bit unsettling.
"These are global economic pressures that caused them to have to back out," said Dunn. "so is it a red flag for here, I don't think it's a red flag for here but I think it certainly is a cautionary signal about the future of offshore wind in North America."
A hiccup in New Jersey does not appear to have deterred Orsted from Delmarva, for now.
Related Knowledge Center: Offshore wind energy
Over the next decade, U.S. offshore wind power is expected to grow from a single 30-megawatt wind farm off Rhode Island to more than 2,000 MW of capacity along the Atlantic Seaboard. There are contracts for wind power off the coasts of Massachusetts, Connecticut, New York, Maryland, New Jersey, Rhode Island, and Virginia.
The National Renewable Energy Laboratory has estimated the United States has over 4,000 gigawatts (GW) of offshore wind potential, enough to power the country four times over.
The growth in part being spurred by state solicitations, including in New York, where then-Gov. Andrew Cuomo (D) set a commitment of 9,000 MW of offshore wind by 2035, and in Connecticut, where in June 2021, Gov. Ned Lamont (D) signed legislation authorizing the construction of 2,000 MW of offshore wind by 2030.
The offshore development is also being driven by an investment tax credit set to end in December 2019 and is equal to 12 percent of expenditures. U.S. Sens. Susan Collins (R-Maine) and Tom Carper (D-Del.) have introduced a bill to extend the tax credit for up to eight years.
The Interior Department has held eight competitive lease sales that resulted in 15 offshore wind leases over 1.7 million acres that has the potential for 21 GW of capacity. In February 2022, the Bureau of Ocean Energy Management completed a bidding process that realized $4.37 billion for 488,000 acres across six lease areas in federal waters off New York and New Jersey.
Projects have also been proposed off the Southeast coast, off California and Hawaii, and for the Great Lakes.