New Bedford officials are up in arms against a bill before the Massachusetts Legislature that they say could jeopardize the city’s offshore wind energy future.
The bill, currently being discussed in committee, would require Massachusetts utilities to collectively purchase 2,000 megawatts of renewable energy through long-term contracts with generators.
The contracts would last 20 to 25 years and generators would have to competitively bid on the contracts.
But the bill includes hydropower generated in dams, along with wind and solar, as renewable energy, something New Bedford’s advocates say is a huge blow to the developing offshore wind industry the city is hoping to cash in on.
Officials here worry that including hydropower opens the door to preexisting projects in Quebec, Canada, that could easily out-bid proposed offshore wind projects that require power purchase agreements to secure investments.
“The current bill … threatens the commonwealth’s nascent offshore wind industry,” Mayor Jon Mitchell said Tuesday in testimony before the Joint Committee on Telecommunication, Utilities and Energy. “Without a buyer for domestic clean energy, the private sector will not develop the abundant wind resources off our coast.”
New Bedford Wind Energy Center Director Matthew Morrissey noted that it’s not just the offshore wind industry’s future at stake – it’s New Bedford’s, too.
The state is already halfway through constructing the $100 million South Terminal project, meant to be a staging area for future offshore wind projects. If successful, the city expects the terminal to spur economic development.
But, Morrissey said, that won’t happen if the Legislature subsidizes Canadian hydropower instead of Massachusetts offshore wind.
“The most important component that is required for the offshore wind industry to emerge in New Bedford is for there to be a purchaser of the renewable power these projects will produce,” he said.
Rep. Antonio Cabral, D-New Bedford, who also testified Tuesday, put it more bluntly:
“We do not want to have us in Massachusetts subsidize jobs in Quebec.”
“We want to subsidize jobs in Massachusetts and give local projects such as offshore wind the ability to compete,” he said. “We should be subsidizing our investments like South Terminal.”
Michael Durand, a spokesman for Northeast Utilities (which owns NStar), noted that the bill, even as written, actually solves a number of obstacles facing the electricity market. Over the past 15 years, the combination of old coal and oil plants retiring and the decreasing price of natural gas has led to New England getting almost half its electricity from natural gas generators.
At the same time, utilities have complained that the falling price of natural gas means using electricity from renewable sources like solar or wind doesn’t always make financial sense.
Allowing renewable resources, even if they are hydro-powered, to bid on long-term contracts that would lock-in electricity prices would help solve those problems.
“We are committed to ensuring there are reliable sources of energy at affordable prices for our customers,” he said.
Representatives of Cape Wind declined to comment on the issue, but Deepwater Wind President Jeffrey Grybowski said in a statement he hopes the legislation will be modified to give preference to “locally-generated sources.”
“We urge lawmakers to consider the local emission reduction, price suppression, job creation and economic development benefits when reviewing energy proposals,” he said.
Morrissey and Cabral said there are a number of easy ways to fix the bill so that it can move forward without putting New Bedford’s economic future at risk.
Morrissey suggested that the Legislature could require a certain percentage of megawatts up for competitive bid to be given to offshore wind projects.
Cabral said the Legislature could also require that the contracts not all be bought by one type of energy generation, or that a certain amount of them stay in-state.
Changing the legislation could drastically affect its impact on offshore wind, according to Morrissey.
“If the Legislature chooses to amend the language to include provisions for offshore wind, we will have the beginning of an industry,” he said.