NY State to issue new offshore wind power solicitation on Nov. 30 - Reuters
NY State to issue new offshore wind power solicitation on Nov. 30 | Reuters
NY State to issue new offshore wind power solicitation on Nov. 30
New York Governor Kathy Hochul speaks during a press conference to announce vehicle congestion pricing plan in New York City, U.S., June 27, 2023. REUTERS/Brendan McDermid/File Photo Acquire Licensing Rights
- Companies
Nov 16 (Reuters) - New York State will issue a new offshore wind solicitation on Nov. 30 with bids due in January 2024, the state government said, in a move that should lend support to the troubled industry.
The solicitation will be open to bidders with existing contracts to sell power from offshore wind projects. Final proposals for offshore wind power will be due Jan. 25 with award announcements expected by the end of February 2024, New York Governor Kathy Hochul said in a release.
By including bidders with existing contracts, the state's plan could provide a lifeline to projects being developed by several European energy firms, including Orsted (ORSTED.CO), Equinor (EQNR.OL) and BP (BP.L).
The companies have warned that they could cancel their projects as uneconomic after failing to increase the amount of money they would receive for the power produced once their projects enter service as soaring inflation and interest rate hikes and supply chain problems boosted the cost to build and finance their projects.
Reporting by Scott DiSavino; editing by Jonathan Oatis and Nick Zieminski
Our Standards: The Thomson Reuters Trust Principles.
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.