Hydropower project asks New York for more money, imitating offshore wind developers - Crain's New York Business
Hydropower project asks New York for more money, imitating offshore wind developers | Crain's New York Business
The developer behind a massive clean-energy project set to deliver Canadian hydropower to New York is arguing for a bigger state subsidy, now that offshore wind developers are also petitioning the state.
Blackstone-owned Transmission Developers is leading the $6 billion Champlain Hudson Power Express Project and argued in filings to the Public Service Commission last week that their undertaking is just as deserving of "cost adjustments" as the four offshore wind projects. The wind projects' developers called on the state this summer for greater subsidies due to unforeseen costs.
“Like the other many developers that have filed petitions, Petitioners faced global supply chain shortages and market disruption, and the substantial negative impacts of inflation and interest rate increases on construction costs in both the United States and Canada,” the CHPE developer wrote in an Aug. 28 filing to the state.
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.