OFF BLOCK ISLAND, R.I., SEPT. 21, 2021…..Hoping to expand the universe of developers that bid on the offshore wind projects that will be key to the next several decades of Massachusetts energy policy, House leaders said Tuesday they are preparing legislation to change the bid requirements, including eliminating the price cap that has been in place for the first three procurement rounds.
During a boat tour Tuesday of the Block Island Wind Farm off Rhode Island, House Speaker Ron Mariano said he charged Telecommunications, Utilities and Energy Committee Chairman Jeff Roy with producing a bill to “help us restore our place in this whole competitive market.”
“We had a tremendous advantage and it is beginning to slip,” Mariano said from the aft deck of the Ava Pearl.
The announcement comes as the bids for the third Massachusetts offshore wind procurement are about to be made public Thursday. Just two companies opted to compete for the state’s third offshore wind project, according to Mariano and sources in the offshore wind industry. The two companies already under contract to generate cleaner wind power for Massachusetts — Vineyard Wind and Mayflower Wind — confirmed that they have submitted multiple proposals for this round. Ørsted, which owns the turbines off Block Island, confirmed that it did not submit a bid this time around.
“We’re hoping to create an industry and we just had two companies bid,” Mariano said. He added, “That’s why we’re doing this, we want that universe to get bigger.”
Among the reasons the speaker gave for the slide he senses in the Bay State’s position in the emerging offshore wind world was the Massachusetts requirement that the price of each project be lower than the price of the project that preceded it. The price cap has been in place since the 2016 energy law that got the state into the offshore wind game.
“We’re going to be looking at those price caps. We’re going to be looking at quantifying and increasing the weight of economic development impacts in future bids,” Roy said. “We’ll make investments in offshore wind through an investment fund, trying to emulate what we did for the life sciences. We’re gonna look at port infrastructure … we’re going to look at grid modernization and transmission planning issues, and increase funding for higher ed institutions who are working in the space.”
To this point in its foray into offshore wind, Massachusetts has put a great emphasis on low costs — the price of Vineyard Wind I’s clean power came as a pleasant surprise for many and the Mayflower Wind project came in with an even lower price.
The elimination of the price cap alone may not be enough to generate significantly more interest in Massachusetts’ offshore wind solicitations. In the middle of the state’s second solicitation, in 2019, Gov. Charlie Baker signed a bill temporarily suspending the price cap and just three bids came in that round — from Mayflower Wind, Vineyard Wind and Bay State Wind.
The legislation Roy described would essentially pivot the state from focusing mostly on cost and towards other aspects of the bids, like job creation and long-term economic development.
“We want to open up the process so that we could encourage companies to come in and bid. We had two bids on the last round and I think Massachusetts would benefit from seeing more than that in the next round,” Roy said. He added, “We’re going to go up to 5,600 megawatts very quickly. So let’s put policies in place that encourage people to want to be a part of the Massachusetts offshore wind.”
Massachusetts has about 1,600 MW of offshore wind power under contract between Vineyard Wind I and Mayflower Wind, and the latest procurement round sought as much as another 1,600 MW. To meet its climate goals, Massachusetts will have to get on pace of bringing about 1 gigawatt (or 1,000 MW) of offshore wind power online each year in the 2030s, the Baker administration has said.
Roy said his plan is to put a bill before the House this session. To that end, Mariano said he was glad 23 representatives joined him for the boat tour Tuesday, which gave lawmakers an up-close look at five of the seven offshore wind turbines in operation along the East Coast. The Environmental League of Massachusetts and Ørsted sponsored the trip.
Mariano got to see massive wind farms off Denmark in person during a 2015 trip and said that getting a first-hand look at them “went an awful long way to convince me that this is worthy of our investment.”
“I wanted other reps who I have to ask to vote for this stuff to see this, and I thought it would be very, very helpful as Jeff [Roy] continues to work on bills to support this industry that these people understand what we’re doing,” the speaker said.
“There’s been a lot of criticism about how obtrusive they are and how upsetting they are to the environment. But I wanted people to see how far offshore they are and how really non-invasive they are, and get a sense of the magnitude,” he said. “We have come a long way but there is still a bit of the Cape Wind prejudice that is out there.”
‘What’s Wrong With Them?’
Twenty-four members of the Massachusetts House departed Tuesday morning from Quonset Point in Rhode Island for the one-hour trip out to the Block Island wind farm. When the visitors arrived and throughout the duration of the tour Tuesday, all five of the project’s turbines were completely still.
Bryan Wilson, who manages the Block Island Wind Farm for Ørsted, said it was undergoing regular maintenance and that he gets many questions about why its turbines aren’t spinning.
“Unfortunately, we have to maintain these right in the peak of tourism season. So lots of folks are asking, ‘what’s wrong with them?’ It’s that we’re making sure there’s nothing wrong with them,” he said.
The Block Island project was developed by Deepwater Wind, which was acquired by Ørsted in 2019, and became operational in late 2016 as the nation’s first commercial offshore wind farm. Its five structures, which are almost four miles from Block Island, each stand about 600 feet tall from the surface of the ocean to the tip of a blade pointed straight up.
The project used Haliade 150 6-MW turbines, which Wilson said were “the largest offshore wind turbines in the world” when they were installed.
“Now, they’re rather diminutive,” he said. The Vineyard Wind I project is expected to use 62 GE Haliade-X wind turbines, each with about a 13-MW capacity.
Not only will Vineyard Wind I’s turbines be more powerful, but each individual turbine structure will likely be much taller than what is offshore of Block Island. The added generation capacity comes from having longer blades on the turbine — the Block Island blades are 75 meters long, compared to 107-meter-long blades on the turbines Vineyard Wind I plans to use — which in turn requires a taller structure for the turbine to sit atop.
Procurement Round Three
The request for proposals published in May sought bids of at least 400 MW and as much as 1,600 MW of generation, though it said the evaluation team would consider projects as small as 200 MW. A 1,600-MW procurement would just about double the amount of energy that Massachusetts utilities have contracted for so far.
State energy officials said last year that one larger solicitation, rather than two procurement rounds of 800 MW each, “would give developers maximum flexibility to use transmission infrastructure efficiently” and could help “minimize the environmental and socioeconomic impacts of siting offshore wind structures in the ocean and on land and achieve many of the potential benefits” of an earlier idea to separately procure a means of transmission from multiple offshore wind projects.
Vineyard Wind said last week, when confidential bids were due, that it had submitted two proposals dubbed “Commonwealth Wind,” offering projects of 800 MW and 1,200 MW which the developer suggested would lead to thousands of jobs and would include “substantial commitments to environmental justice communities.”
Either size Commonwealth Wind project would be located just south of the Vineyard Wind I project and the firm’s Park City Wind, a Connecticut project that is under federal review.
Mayflower Wind confirmed to the News Service that it has submitted multiple proposals in response to the state’s latest solicitation. Details of the bids are expected to be made public Thursday.
The Ørsted and Eversource joint venture said that it decided to take a pass on the latest Massachusetts solicitation “[a]fter carefully considering the request for proposal issued by the Commonwealth of Massachusetts and reviewing our current activity in the U.S. offshore wind industry.”
The joint venture said it considered “lease area optimization, strategic fit with our existing portfolio of projects, and our ability to maintain a strong sense of fiscal discipline” in coming to its decision.
The evaluation team is expected to select a project or projects for contract negotiations by Dec. 17, a contract is expected to be negotiated by March 28, 2022, and a final contract is to be submitted for Department of Public Utilities approval by April 27, 2022.