CT bails on offshore wind, chooses solar projects instead
Dec 20, 2024
After months of will-they-or-won’t-they speculation, the Connecticut Department of Energy and Environmental Protection announced it would not buy into a new offshore wind project through the very process it has long advocated and helped set up.
“We have closed our solicitation for offshore wind resources without selecting any bids,” said DEEP Commissioner Katie Dykes.
With that, what was supposed to be New England’s biggest and most innovative offshore wind initiative ever ended with a thud that also killed a project Massachusetts had planned.
The DEEP also announced procurements of grid-scale solar and storage projects, roughly equal in power to what a wind project might have been but not as reliable.
What made the offshore wind initiative unique was that it was a three-state solicitation by Connecticut, Massachusetts and Rhode Island, designed to get the best prices and efficiencies for electricity created by new offshore wind that would be key in creating carbon-free energy to help curb climate change and provide enough power to meet anticipated increased needs.
It was also the first such effort in the U.S.
The decision on wind was expected. Gov. Ned Lamont had expressed reluctance to accept the proposals arising from the three-state RFP over the cost to ratepayers, most recently in an interview Wednesday on WNPR’s “The Wheelhouse.”
“It seems very expensive, and I care deeply about green and affordability,” Lamont said.
Sen. Ryan Fazio, R-Greenwich, and the ranking member on the energy and technology committee, agreed with that assessment and decision from the governor.
“A long term purchase agreement for offshore wind at this point would have significantly raised electric bills for consumers in Connecticut who are paying too much already,” he said. “I’m glad that the advocacy of Republicans in this state over the last several months have been persuasive in stopping an above-market purchase of offshore wind power, which would have inflated consumers’ bills far more.”
Several grid and energy experts contacted by The Connecticut Mirror said impacts from offshore wind projects would not be felt on consumer bills until the projects begin generating power, years after an initial agreement.
“The risk to ratepayers only occurs when the electrons start to flow, many, many years from now,” Jeremy McDiarmid, managing director and general counsel at Advanced Energy United, a group that advocates for clean power, said last month.
Dykes didn’t respond to whether Connecticut’s decision to bow out of the group effort might make partner states leery of teaming up with Connecticut again on such a project.
“We see coordinated procurements as a valuable tool,” she said. “We remain committed to coordinate our procurements. It makes a ton of sense and is something that we will continue to rely on.”
At the same time, DEEP announced it was moving ahead with other grid-scale projects under its first zero-carbon solicitation. There are three solar projects: a 200-megawatt project to be located in Connecticut, and then two projects totaling 318 megawatts that will be located in Maine. DEEP also approved 200 megawatts of storage capacity for a project that would be built in Connecticut on an unidentified abandoned brownfield.
All the projects will now need to negotiate long-term contracts with the state’s two utilities, Eversource and United Illuminating, followed by approval from the Public Utilities Regulatory Authority.
“These decisions were made based on cost and other factors, all of which are important,” said Sen. Norm Needleman, D-Essex and co-chair of the Energy and Technology Committee. “I am glad that we are adding generating capacity on the grid. We are going to need it.”
“The failure to support offshore wind in this procurement round places Connecticut’s energy future in jeopardy and strands the infrastructure investments that we have already made to support offshore wind projects,” said Charles Rothenberger, director of government relations at Save the Sound, a nonprofit advocacy group.
He did praise the selection of solar projects but said: “Offshore wind not only provides the greatest opportunities for meeting the state’s zero-carbon electricity goal, it is also an ideal cost-effective solution for addressing the region’s winter reliability concerns.”
McDiarmid of Advanced Energy United called the decision disappointing.
“Offshore wind — like solar and storage — will continue to be a key part of Connecticut’s energy future. We’re confident that the days ahead will provide new opportunities to develop offshore wind projects that serve our pressing energy and economic needs,” he said.
Rothenberger also said he was concerned that backing away from offshore wind could mean less work at State Pier in New London, which has become a regional assembly and staging port for offshore wind as neighboring states develop their own ports and developers divert work to states securing their power.
A report called Winds of Prosperity, released a month ago, touted the nexus of the offshore wind industry in New England, job creation — especially for unions — and economic development.
The Connecticut Roundtable on Climate and Jobs participated in the report. Aziz Dehkan, its executive director, did not return calls to comment on the latest development but last month told CT Mirror that his organization was continuing to advocate for offshore wind and put pressure on the governor.
“This isn’t just about climate. This is about jobs,” he said. “And I think that’s what we need to pivot to. Let’s talk about jobs and climate.”
Rothenberger also said: “With the incoming Trump administration signaling that it will obstruct the permitting process for offshore wind projects, it is imperative that we secure contracts now to ensure that offshore wind energy will be available when we need it.”
President-elect Donald Trump for years has stated his hatred for offshore wind. He has threatened to stop all offshore wind projects on day one, referring to subsidies for them as “insane.” During his first administration, permitting and other approvals for offshore wind slowed dramatically.
By contrast, the Biden administration set a goal of deploying 30 gigawatts of offshore wind by 2030. It has approved more than 16 gigawatts from 11 projects. The latest was for a New England project and was announced Friday as Connecticut made its decision public. The Biden administration also expanded leasing for offshore wind to the entire East Coast as well as the Gulf of Mexico and the Pacific coast. Offshore wind has been a staple of European power for more than two decades.
The multistate idea was hatched earlier this year after offshore wind developers on the East Coast wanted to renegotiate a number of existing deals after higher costs from COVID, the Ukraine war and the ensuing inflation made their financing unworkable. Others pulled out of their deals.
Among them was Avangrid. It pulled out of an 804-megawatt contract for Connecticut called Park City Wind, which included jobs and port development in Bridgeport. It also pulled out of a 1,200-megawatt contract in Massachusetts called Commonwealth Wind.
A new solicitation was held with several of the existing projects out for new bids.
Just after Labor Day, Massachusetts and Rhode Island announced their decisions, but DEEP said simply, “The evaluation of project bids remains underway in Connecticut, and we will announce a final decision in our solicitation at a future date.”
Massachusetts announced it would grab the old Park City Wind project, which is the farthest along with its permitting in place, making it hard for the Trump administration to shut it down. Massachusetts also chose 1,087 mw of a project called South Coast Wind, a rebid project. Rhode Island opted for the remaining 200 mw of South Coast.
In not choosing a project, though, Connecticut upended one of Massachusetts’ large offshore wind plans: acquiring part of Vineyard Wind 2, a 1,200 mw project.
Massachusetts chose 800 mw out of Vineyard Wind 2. But the project’s distance from shore requires more expensive cabling, so it is not viewed as cost effective unless the entire parcel is chosen. However, the expectation was that Connecticut would opt for the rest of the Vineyard Wind 2 project. That has now not happened.
Hours later, that project’s developer, Vineyard Offshore, pulled the plug.
A statement from spokesperson Kathryn Niforos read: “We were proud to submit our Vineyard Wind 2 proposal in response to the New England three-state solicitation, and we are grateful to Massachusetts for its provisional award of 800 MW. With Connecticut’s decision today not to purchase the remaining 400 MW we are unable to contract the project’s full 1200 MW at this time. We look forward to advancing this project and participating in future solicitations to meet the region’s growing energy needs while spurring economic investment and creating thousands of American energy jobs.”
A spokesperson for the Massachusetts Department of Energy Resources said: “Massachusetts’ selection of Vineyard Wind 2 was contingent on the project securing an offtake agreement for the remaining 400 MW of capacity. We will continue to explore all possibilities for moving this project forward and encourage Vineyard Offshore to participate in our anticipated 2025 solicitation.”
Connecticut’s opt-out leaves it with only one small offshore wind project, a 300 megawatt portion of Revolution Wind, which is under construction. There are no projects in the works that would go towards the authorization for up to 2,000 megawatts of offshore wind the legislature approved in 2019.
Lamont cast today’s wind decision in the broader context of turning to more affordable sources of renewable energy, including solar and on-shore wind from Maine, plus Connecticut’s participation in Revolution Wind.
“We took a pass on this round. But as you know, we’re the state right now that’s building out Revolution Wind. That’s going to turn on in about a year and a half. We contracted for solar coming down from Maine,” Lamont said Friday.
“Every state has got different priorities about how we increase capacity, which is how, ultimately, we’re going to bring down the cost of electricity and do it in as green away as we can,” Lamont said.
Mark Pazniokas contributed reporting.