The earliest Virginia offshore commercial wind development could occur would likely be 2022, or even five years later than that, energy officials said Thursday.
Getting the required permits to build an offshore wind farm could take seven years alone.
More than 50 people – representing firms interested in wind energy development, government agencies, consultants, law firms, and environmental groups – came to a federal agency’s presentation Thursday in Henrico County on the proposed offshore lease auction.
Eight firms, including Richmond-based Dominion Resources Inc., have expressed interest in commercial development of the lease area 22 miles off the Virginia coast, but the federal government has not yet set a date for the online auction of the 112,799-acre tract.
The required final notice of the auction, however, should come later this year, according to Darryl K. François with the federal Interior Department’s Bureau of Ocean Energy Management. The auction could occur no earlier than 30 days after the official notice is posted.
Bidding for the lease area will start at $5 an acre, the federal officials said. Besides the annual rent, the auction winner also will pay the federal government annual operating fees and transmission line easement rents.
Eventual commercial development of the tract in the Atlantic Ocean would depend on a number of other factors, officials said, including the project’s costs and competition from other sources of electric generation.
“It all depends on what we see as the ability to bring the cost down,” said Mary C. Doswell, Dominion Resources’ senior vice president for alternative energy solutions.
The winner-take-all auction “might not be in the best interests of competition,” said Aviv Goldsmith, managing director for development with Fishermen’s Energy LLC, which is based in Cape May, N.J.
“Why give one player 2,000 megawatts, when you can develop 300-350 megawatts” in phases offshore by a variety of developers, Goldsmith said. “We’d like it to be more competitive.”
Electricity from sea-based wind now costs more than twice as much to produce as power from Dominion Virginia Power’s current generation sources, the company said.
However, the company doesn’t want all its generation eggs in just a few baskets. “We need … fuel diversity,” Doswell said.
Once wind-powered generators are built, their “fuel” – wind – is free, but wind doesn’t blow predictably and sometimes it doesn’t blow at all. The federal ocean energy agency expects the wind farm would operate at about 40 percent of the theoretical capacity.
Dominion Virginia Power is in the running for a federal grant of up to $47 million for an offshore wind energy test project, aimed at generating electricity from two 6-megawatt wind turbines by 2017.
Commercial operation would start about five years after that, said Tyson Utt Mid-Atlantic development director for Apex Wind Energy Inc. in Charlottesville, while Fishermen’s Energy’s Goldsmith said the time could be five to 10 years after 2017.
No wind turbines are currently making electricity in U.S. offshore waters.
Under Dominion Resources’ test project proposal, the full-scale turbines’ hubs would be about 325 feet above the water, while their rotor diameter would span nearly 500 feet, said Guy W. Chapman, the company’s renewable energy research and program development director. “They’re big.”
While the turbines’ combined 12-megawatt output would provide enough electricity for 3,000 homes at peak demand, “the real gain out of this (test project) is the data,” Chapman said.
A 2,000-megawatt wind farm “is not unreasonable,” Goldsmith said, but “the permitting process will take longer than to build a coal plant on land. We think there’s something wrong about that.”
Justin Allegro with the National Wildlife Federation expressed concern that sonar testing for the wind turbines could disturb the migration of North Atlantic right whales.
On the other hand, Allegro said, “We’re really excited about offshore wind.”
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