Greenpower Offshore Wind Power USA Conference Focuses on How and When (not if) the U.S. Offshore Wind Industry Moves Forward, as Financing for the Deepwater Block Island Offshore Wind Project is Completed
This post was guest written by my NRDC colleague Andrea Leshak, who is a Ford Legal Fellow at NRDC.
Recently, I had the opportunity to attend the Greenpower Offshore Wind Power USA conference in Boston. This annual conference brings together the emerging leaders in the U.S. offshore wind industry, European offshore wind developers, federal and state energy regulators, supply chain manufacturers and environmental advocates, and there are always lively discussions on how to move offshore wind forward in the United States. Despite continued difficulties for Cape Wind's financing and power purchase agreements, the panelists and attendees at this year's conference remained optimistic about the future of the U.S. offshore wind industry. This optimism was validated last week by thegood news that Deepwater Wind's Block Island offshore wind project has reached financial close and is expected to be America's first offshore wind farm, with construction slated to begin this summer.
Indeed, the opening keynote address by Kathryn Thornton, Physicist & Former NASA Astronaut (what she described as the "entertainment portion" of the conference) which focused on the history and future of space exploration, made the challenges posed by offshore wind development seem relatively simple. While challenges remain, panelists and attendees seemed to agree that it is a matter of how and when (rather than if) the offshore wind industry will gain traction in the United States.
A question which arose quite frequently during the two-day conference was whether the best path forward for the U.S. offshore wind industry to succeed is a multi-state regional approach rather than the current state-by-state approach with each state developing separate policies. Proponents of a regional approach argue that this is the best way to spur regional economic development, reduce costs, and create a pipeline of demand. Others argued that significant differences in existing regulatory and incentive structures across states could make it much more difficult for a regional approach to work and were concerned that moving to a regional approach could cause further damaging delay. These and other considerations resulted in an interesting debate over the course of the two-day conference. In the end, it became clear that - whether or not a regional approach is a wise approach - some states have already begun moving forward with offshore wind development, while others are at least very seriously considering paths forward.
One of the states seriously considering the appropriate path forward is New York State. John Rhodes, President and CEO of the New York State Energy Research and Development Authority (NYSERDA) was a speaker at the conference and described in detail initiatives that New York State is contemplating pursuing to encourage offshore wind development and to provide New Yorkers with clean, affordable and reliable power. As Rhodes explained, New York State is taking a thoughtful approach that is expected to result in a comprehensive market for offshore wind in the long-term. Implementing this approach, however, will require a number of actions including: changing the market to recognize the value of system benefits provided by offshore wind power; addressing capital cost barriers; increasing the availability of information; and encouraging speedy, responsible siting.
Even while some states carefully plot their way forward on offshore wind development, the conference made clear that significant progress in this industry has already been made. As noted above, what will be America's first offshore wind project, Deepwater Wind's Block Island project, is fully financed, will begin construction this year, and is slated to begin providing clean reliable electricity to Americans by the summer of 2016. Currently in the U.S., there are thousands of megawatts of projects in advanced planning stages, and to date, the Bureau of Ocean Energy Management (BOEM) has issued seven commercial wind energy leases. And we heard from Abby Hopper, the new head of BOEM, that the federal government is just getting going, with more exciting developments for offshore wind in store. Even more, three demonstration projects funded by the Department of Energy are expected to begin installation by 2017 and will showcase advanced technologies such as floating turbine technologies. Indeed, it is an exciting time for offshore wind development in the U.S., with much more progress on the horizon.