April 15, 2008
Rhode Island

Uncertain future for wind farm

Gov. Donald L. Carcieri’s recent decision to court private developers interested in building a large wind farm in state waters puts Rhode Island in league with several states that have recently moved forward with plans for offshore wind-energy projects.

But large, offshore wind farms are an unproven – if promising – energy source in the United States, and several such projects that have already been proposed nationally face an uncertain future.

On April 3, Carcieri announced he had put out to bid waters south of Block Island to gauge interest in the private development of a very large, offshore wind farm capable of generating 1.5 million megawatts of power, or about 15 percent of Rhode Island’s electricity needs.

The wind farm would require about 105 wind turbines, making it about as large as the Cape Wind project off Cape Cod – the first proposed offshore wind project in the country, which has faced bitter opposition and has spent seven years wending its way through a Byzantine federal permitting process.

About 20 major offshore wind-energy projects are currently being considered in the U.S., many of which were proposed in the past year, said Matt Kaplan, an analyst for the North American wind-energy division of Emerging Energy Research, an energy-consulting firm with offices in Cambridge, Mass.

Several states already have done what Rhode Island is now doing in making state waters available to private developers, including Texas, which recently put out a land-lease tender so developers could secure sites off the coast, and New Jersey, which recently released a tender that received a few bids for offshore projects.

But in a handful of cases around the country, offshore wind farms are being second-guessed or cancelled entirely because of concern that they won’t be profitable, Kaplan said.

“In most cases, it comes down to the fact that offshore wind energy is more expensive than land-based projects,” he said.

In both cases the projects stalled when private utilities that would buy electricity from the offshore wind farms have sought to renegotiate or opt out of the agreements after financial forecasts showed the electricity would cost more than originally expected, Kaplan said.

Offshore wind farms cost more than similarly-sized wind farms built on land for a few reasons: wind turbines used in offshore farms are still a relatively new, expensive technology; more environmental engineering and maintenance is needed for wind farms built in the ocean; and the price is also driven up by a lengthier permitting process and the risk of grassroots and political opposition.

In Europe, however, offshore wind projects have had some success for several reasons, including public financing mechanisms that exist in several countries.

Many would-be developers of large, offshore wind farms in the U.S. are wary of becoming involved in a drawn-out and contentious battle to get a project built, having watched the price tag associated with the Cape Wind project in Massachusetts rise from $700 million to an estimated $1.6 billion today.

Developer Cape Wind Associates is in the final stages of a regulatory process that began in 2001, and could get permits to begin construction by the end of the year. The project was almost derailed and still faces pressure from a highly organized campaign against it from some Cape Cod residents and environmentalists.

“It all comes back to Cape Wind,” Kaplan said. “Seeing the opposition there has been, to be honest, a big turnoff to developers.”

But state ocean-zoning regulations that Rhode Island plans to draft could significantly speed the permitting process for an offshore wind farm and reduce the risk of “not-in-my-back-yard” opposition, making such a project more attractive to developers.

The R.I. Coastal Resources Management Council (CRMC), the agency that regulates the state’s coastline, hopes to begin work within the next couple of months to create a Special Area Management Plan (SAMP) to determine suitable locations in Narragansett Bay for wind farms that would not interfere with shipping lanes, sensitive wildlife habitats or the fishing industry.

The state ocean-zoning regulations, which would be modeled on zoning regulations created in Great Britain and other European nations to site wind farms, would be the first in the nation.

While the U.S. Army Corps of Engineers, which has federal jurisdiction over projects built in state waters, would still have to conduct its own review of a proposed offshore wind farm, the process would likely be more limited than a full-blown environmental review, said Tim Dugan, a spokesman for the New England district of the U.S. Army Corps of Engineers.

“We believe a Special Area Management Plan could speed up an environmental review, if say a company were to apply to construct a wind farm,” Dugan said.

Both the Army Corps of Engineers and the U.S. Minerals Management Service, which regulates federal waters, plan to participate in Rhode Island’s work to develop state ocean-zoning regulations, said Grover Fugate, the CRMC’s executive director.

But funding for the work, which would cost at least $4 million and take two or three years to complete, has not yet been lined up.

Fugate said he hoped that about $3 million could be made available from the state’s renewable- energy fund. CRMC is also pursuing federal funding. The $2 million needed for a meteorological tower that would be built in Narragansett Bay to gauge wind speeds and frequency could probably be paid for by a potential developer, who would share the data with the state or other developers if it did not win a contract to build a wind farm here, he said.

By David Ortiz
PBN Staff Writer