Three US States to Ask Developers to Submit Multi-State Offshore Wind Proposals | Offshore Wind - Offshore WIND
Three US States to Ask Developers to Submit Multi-State Offshore Wind Proposals | Offshore Wind
Three US States to Ask Developers to Submit Multi-State Offshore Wind Proposals
Massachusetts, Rhode Island and Connecticut have signed a memorandum of understanding (MOU) that enables the three states to employ a coordinated selection of offshore wind projects through each of their respective offshore wind energy generation solicitations.
Under the MOU, the first of its kind in the United States, Massachusetts, Rhode Island and Connecticut request that offshore wind developers submit multi-state offshore wind project proposals for consideration through each state’s respective offshore wind procurement for selection in 2024.
Project selections will depend on states’ individual assessments of proposals’ costs and benefits to ratepayers and other evaluation criteria specified in states’ requests for proposals (RFPs). Any two or three states may agree to select a multi-state proposal(s) up to each states’ procurement authority and split the anticipated megawatts and renewable energy certificates from a single project, a press release from the Massachusetts Governor’s office states.
According to the MOU, through their offshore wind solicitations, the states may request bidders to submit at least one multi-state proposal for all parties (state agencies and/or electric distribution companies running the solicitations) to consider proportional sharing under the MOU, with instructions for the bidders on how to submit such proposals contained within the Multi-State Proposal Form.
The three states’ MOU also binds each state to consider a multi-state proposal regardless of whether a bidder has submitted an associated single-state proposal.
Currently, Massachusetts, Rhode Island and Connecticut are set to procure up to 6,000 MW of offshore wind generation capacity.
In August, Massachusetts opened its largest-ever offshore wind solicitation, seeking to procure 3.6 GW of generation capacity by June 2024.
Rhode Island Governor announced last month that the state would soon be issuing a new RFP to solicit approximately 1,200 MW of offshore wind.
The solicitation is expected to be launched later this month, with proposals due in early 2024 and a potential selection of projects to be made in the Summer of next year.
In a press release issued on 28 September, the Rhode Island government said the new RFP would be released to coincide with offshore wind RFP procurement efforts in Massachusetts and Connecticut, driving a unique offshore wind industry opportunity and economies of scale across New England.
Connecticut is also preparing an offshore wind RFP that will see the state selecting offshore wind projects next year.
In a statement welcoming the signing of the MOU, the country’s offshore wind organisation, Business Network for Offshore Wind, said that this would allow for procuring larger projects that would drive new investment in the supply chain and were more beneficial for ratepayers while posing less risk for project developers.
“For years, the Business Network for Offshore Wind has championed procuring offshore wind at scale, however, we were not thinking big enough. Procurement at this scale is exactly what industry needs to solve some of its most pressing issues. Big scale drives real cost reductions, fosters a pipeline large enough for new manufacturing investments, and should create enough certainty to entice developers and vessel owners to enter into framework agreements that would unlock capital sitting on the sidelines,” said Liz Burdock, founder and CEO of the Business Network for Offshore Wind.
“The New England coast is already a hub of activity, and this regional collaboration helps to maximize the hundreds of millions of dollars already dedicated to preparing ports like New London, Providence, and New Bedford, local workforces, and local supply businesses.”
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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.