WASHINGTON President Barack Obama on Wednesday declared North Carolina’s coastal waters and the rest of the Atlantic Ocean off-limits to drilling for oil and gas, reversing a policy his administration established this spring – just weeks before an oil platform exploded in the Gulf of Mexico.
The decision means there will be no exploratory drilling or oil and gas leases in the Atlantic through at least 2017.
Interior Secretary Ken Salazar said Wednesday that the BP oil blowout in April showed that the federal government is not yet prepared for large-scale offshore drilling in new regions.
“We learned a number of lessons – most importantly that we need to proceed with caution and focus on creating a more stringent regulatory regime,” Salazar said.
His announcement came on the same day as a report from the National Wildlife Federation that shows the Tar Heel state could turn to a different energy resource; the report said North Carolina has the greatest offshore wind potential of any state along the Eastern Seaboard.
The news could mark a path for N.C. companies, policymakers and researchers looking at how best to harness energy from the state’s coast. Salazar announced last week that the administration would speed up the permitting process for offshore wind development.
North Carolina could have the most viable offshore wind power on the East Coast, with the ability to bring power to hundreds of thousands of homes and to generate 10,000 to 20,000 new manufacturing jobs, according to the new National Wildlife Federation study, called “Offshore Winds in the Atlantic.”
The state has “great potential” for offshore wind power, thanks to its shallow waters, lengthy coastline and excellent wind speeds, according to the report.
That’s based on studies from the U.S. Department of Energy and UNC Chapel Hill.
The Department of Energy’s “20 percent by 2030” report predicts that 5 to 10 gigawatts of energy could come from the Tar Heel coastline.
Perdue weighs in
Gov. Bev Perdue already is working to open the coastal waters to wind power development, said her spokeswoman, Chrissy Pearson.
“She wants to see wind turbines off the coast. She wants to see if it can be developed cost-effectively and safely,” Pearson said. “She’s pushing the Department of Commerce to woo companies to North Carolina to invest in that. In the next two years, she’d like to see a company or two committed.”
The Obama administration’s decision not to open Atlantic waters to offshore oil and gas drilling doesn’t change Perdue’s opinion, Pearson said. She has been open to the idea, with conditions.
“If a resource is tapped off North Carolina’s coast, the governor wants to make sure it’s done safely, with an eye toward protecting our natural resources and our fishing resources, and that there is some ability to share revenue,” Pearson said.
A continued ban on drilling just gives the state more time to look into those issues, she said.
Private companies already are expressing interest in the N.C. coastline.
Apex Wind Energy has applied for a federal exploratory lease for 216 square miles of ocean more than 20 miles off the coastline. The project could use more than 500 turbines, generating enough energy to power 550,000 homes.
The first phase of the project, which could cost $3 billion could begin as early as 2015, according to the study.
Progress Energy Carolinas signed a deal in June to develop a three-year study of the coastline’s wind potential, working with UNC Chapel Hill.
But Duke Energy this summer killed its proposal to develop an offshore wind project with UNC Chapel Hill to put three demonstration turbines at the coastline.
Looking to the mountains
Dennis Scanlin, a professor of technology at Appalachian State University’s wind center, said policymakers might do well to consider mountain wind resources too.
The state has 2,000 miles of ridgeline, which is an easier and cheaper spot to plant turbines than the ocean, he said. A kilowatt-hour of wind energy from ocean turbines could cost up to 20 cents, he said, about four to five times more than a kilowatt-hour from a land-based turbine.
“The mountains would be far better, far lower cost energy,” Scanlin said.
Harnessing the resolve
The National Wildlife Federation report cautions that southern Atlantic states have not pushed the aggressive renewable energy initiatives of their northern brethren.
“Now the question is, can we collectively harness the resolve to harvest that wind and, in doing so, bolster our economy while preserving our air, water and wildlife resources?” said Tim Gestwicki, executive director of the N.C. Wildlife Federation, based in Charlotte.
North Carolina’s renewable energy standard is 12 percent by 2021 – “a low bar,” the report says.
By comparison, New Jersey’s is 22.5 percent in the same time frame, and New York expects to reach 20 percent as soon as 2015.
North Carolina also poses risks, including its proclivity to get hit by hurricanes. Electricity costs in the South also are relatively low, which could discourage investment.
“The barriers as they stand now are great,” said Rob Sargent, energy program director of Environment America. “If nothing changes, we’re unlikely to see any significant offshore wind before 2020.”
Wednesday’s announcement on offshore drilling means that with the Atlantic off the table, the administration will focus on areas of the country where leasing already is taking place, notably the Gulf of Mexico and Alaska, Salazar said.
“Our revised strategy lays out a careful, responsible path for meeting our nation’s energy needs while protecting our oceans and coastal communities,” he said. Staff writer Bruce Henderson contributed.
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