New York Gov. Hochul announces 4 GW of offshore wind contracts as industry criticizes recent actions
New York Gov. Hochul announces 4 GW of offshore wind contracts as industry criticizes recent actions | Utility Dive
Dive Brief:
- New York Gov. Kathy Hochul, D, announced solicitation awards for 25 new renewable energy projects totaling 6.4 GW on Tuesday, including three offshore wind projects — days after vetoing an offshore wind transmission planning bill, and after a state commission rejected a petition from three offshore wind developers seeking project contract adjustments due to inflation.
- The American Clean Power Association warned that the veto had the state coming “dangerously close to serving a death knell” for offshore wind in the region and saying Hochul “must get serious” about the state’s clean energy goals, but praised the 25 awards and said the state’s investment would deliver “much-needed benefits.”
- In addition to conditionally awarding new contracts, Hochul’s office announced $300 million of state investment to develop facilities that will manufacture nacelles and blades for offshore wind turbines.
Dive Insight:
The three offshore wind projects announced were the 1,404-MW Attentive Energy One being developed by TotalEnergies, Rise Light & Power and Corio Generation; the 1,314-MW Community Offshore Wind being developed by RWE Offshore Renewables and National Grid Ventures; and the 1,314-MW Excelsior Wind being developed by Vineyard Offshore.
Hochul vetoed an offshore wind transmission planning bill Friday over an aspect of the bill that would temporarily take over parkland in Long Beach while a subterranean conduit and electrical distribution cable system were constructed to support the Empire Wind 2 project 14 miles off shore.
The 1,260 MW Empire Wind 2 project is already facing financial difficulties, along with other offshore wind projects in the region and across the country. The project’s developer Equinor, along with fellow regional developers Ørsted and BP, recently petitioned the state for relief.
The petition to amend the power supply contracts for relief from spiking project costs was denied because the adjustments the companies were seeking would have resulted in billions in additional costs to ratepayers, the New York Public Service Commission said.
But Wednesday’s announcment brought more positive news for the state’s offshore wind sector. New York’s awarding of three contracts for more than 4,000 MW of offshore wind shows the state is “prepared to double down” on the resource, said Fred Zalcman, director of the New York Offshore Wind Alliance, in a release.
Zalcman had said the week before that Hochul’s “actions are not matching her works,” and that it was “hard to square this [veto] decision, along with last week’s silence regarding the Public Service Commission’s denial of inflation adjustments, with public statements that momentum continues for New York’s offshore wind industry.”
After Hochul’s veto of the transmission planning bill, Zalcman said in a release that the decision “put another nail in the coffin of the Empire Wind project.”
Ross Gould, vice president of supply chain development & research at the Business Network for Offshore Wind, who had also questioned the state’s recent actions on offshore wind, praised Tuesday’s announcement.
The awards are an “important step toward getting the state’s offshore wind industry back on track,” he said in a release.
“It’s no secret that New York’s clean energy and offshore wind goals are in doubt after the state’s recent decisions threw uncertainty into the market, and we encourage the state to fulfill its Action Plan by finding paths forward for previously awarded projects and stabilizing the state’s offshore wind industry,” Gould said.
In her veto message, Hochul cited the City Council of Long Beach’s opposition to any alienation of parkland. “It is incumbent on renewable energy developers to cultivate and maintain strong ties to their host communities,” she said.
Molly Morris, president of Equinor Renewables Americas, told CBS that Hochul’s veto along with the petition denial “sends another troubling signal to renewable energy developers.”
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.