Posted Oct 28, 2016 at 10:42 AM
“Worldwide, leaders are sensing and seeing the opportunity,” says Tom Kiernan, CEO of the American Wind Energy Association. “The completion of the Block Island Wind Farm is far more than just a ribbon-cutting – it is the dawn of an entirely new source of U.S. energy.”
Rewind five or six years and developers up and down the East Coast were competing against each other to reach a milestone known in their industry as “steel in the water.”
The pack included Bluewater Wind, which was touting a project off the Delaware coast, Fishermen’s Energy, with a pair of proposals in New Jersey, and, most notably, Energy Management, the Boston-based company that was moving ever closer to bringing to fruition the attention-grabbing Cape Wind project in Nantucket Sound.
As anyone who follows the industry knows, Providence-based Deepwater Wind prevailed in the competition, this summer completing the Block Island Wind Farm, a five-turbine test project in Rhode Island waters. As for the other projects, some have fallen apart (Bluewater’s proposal), some appear permanently stalled (Cape Wind) and some are still crawling ahead (Fishermen’s Energy’s projects).
Undeterred by these decidedly mixed results, a new wave of companies, many with financing from overseas, has come forward with plans to build offshore wind farms off Massachusetts, Rhode Island and beyond — the mid-Atlantic, the Great Lakes, Oregon, California and Hawaii.
They want to tap into an energy source with huge potential — the U.S. Department of Energy estimates that total offshore wind capacity in American waters is double the amount of electricity the nation generated in 2015. And in the Deepwater project they have a model of how it can be done.
“Worldwide, leaders are sensing and seeing the opportunity here in the U.S.,” Tom Kiernan, CEO of the American Wind Energy Association, said in a statement. “The completion of the Block Island Wind Farm is far more than just a ribbon-cutting — it is the dawn of an entirely new source of U.S. energy.”
On a recent afternoon at the Crowne Plaza hotel in Warwick, some of the old and new developers were on hand at AWEA’s annual offshore wind conference to update regulators, suppliers, government officials and the hundreds of others in attendance on their projects.
Chief among the developers is still Deepwater — “the reason we are in Rhode Island today,” as one conference emcee said. The company has proven itself with the Block Island pilot project, which is expected to start generating enough power for 17,000 Rhode Island homes before Thanksgiving.
Deepwater is also planning a wind farm of up to 200 turbines in federal waters in Rhode Island Sound and is negotiating to sell power to the Long Island Power Authority from what would be the 90-megawatt first phase of the project.
Fishermen’s Energy isn’t far behind. CEO Chris Wisseman said the company is close to securing a power purchase agreement for its Atlantic City project that could put it on track for installation in 2018. And there is also US Wind, which is planning a project off Maryland that could start construction in 2020.
But, in a telling sign that the industry is maturing beyond a single project in Rhode Island, companies with connections to Europe — where 12,000 megawatts of offshore wind has been installed since the mid-1990s — have set their sights on U.S. waters.
Lars Pedersen, co-CEO of Copenhagen Infrastructure Partners, said his firm joined up with OffshoreMW on a project off Massachusetts because of “fundamentals” that include major cities near the coast with large energy needs and relatively shallow waters that are easier to build in.
Danielle Lane, of DONG Energy, which is also planning a wind farm off Massachusetts, said the potential for the industry in the United States could exceed what’s been achieved so far in Europe.
“It’s not just about one state,” she said. “There’s an opportunity on the whole Northeast coast and perhaps the Pacific as well. We’re potentially on the threshold of something great.”
Competition is critical to the growth of the industry, said Deepwater CEO Jeffrey Grybowski.
“The fact that they’re here and competing is a good thing for our market, a good thing for ratepayers,” he said. “With competition, price comes down. It’s the way we build a market that is real and sustainable and not just based on government subsidies.”
The Block Island project has been criticized for the high price of power it will charge utility National Grid — the starting price of 24.4 cents a kilowatt hour is far higher than the rates from fossil-fuel energy sources — and for state legislation that some critics say tilted the regulatory process in its favor.
But coal-fired generators and other older fossil-fuel power plants are shutting down, creating a need for alternatives. Paul Rich, managing director of US Wind, described this as a “pivotal moment” for offshore wind power. Grybowski agreed.
“We’re living through a moment in history where the entire energy sector is changing before our eyes,” he said.
He and the other developers hope that offshore wind will be part of the new mix.
“How many times in your lifetime can you create an industry?” said Alla Weinstein, founder of Trident Winds, which is proposing a wind farm off California.