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Presenting a live 90‐minute webinar with interactive Q&A

Offshore Wind Energy: Emerging Legal Challenges Navigating Legal Requirements, Obtaining New Government Funding, and Lessons From Successful UK Wind Projects

T d ’ f l f

1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific

TUESDAY, NOVEMBER 8, 2011

Today’s faculty features:

Chris Hart, Offshore Wind Manager, United States Department of Energy, Washington, D.C.

Kimberly Diamond, Counsel, Lowenstein Sandler, New York

Maria Scarlett, Irish Sea Zone Development Manager, Centrica Renewable Energy

Chris Elkinton, Senior Engineer, Garrad Hassan America, Portland, Ore.

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Offshore Wind

R h d D l t

Christopher G. Hart, PhD, MBAOffshore Wind Manager

5 | Program Name or Ancillary Text eere.energy.gov

Research and Development Wind and Water Power Program

October 19, 2011

Laying the Groundwork for an Emerging Industry

• The National Strategy is a roadmap of our effortsa roadmap of our efforts and how DOE and DOI plan to advance aplan to advance a nascent offshore wind industry

• DOE’s 2011 funded research is integral to securing a renewable

f h

6 | Energy Efficiency & Renewable Energy eere.energy.gov

energy future in the US

DOE Offshore Wind History

June RFI receives 113 responses

Large‐Scale Offshore Wind Power in the United States

2010

“Creating an Offshore Wind Energy Industry in the US” seminar series in Boston, Cleveland, and DC

DOE and DOI jointly announce A National2011

Sept

Feb

March

DOE and DOI jointly announce A National Offshore Wind Strategy and three FOAs

“Rising Tide” US‐UK Symposium

2011

Statement of Intent with the Province of OntarioJune

July DOE reviews FOA applicationsSept

DOE awards $50.5M for FOAs


DOE hosts FOA Recipient Kickoff MeetingOct

DOE is a National Leader

• Inform citizens and decision makers

• Convene leaders and facilitate national and international information exchange

• Support innovation partnerships to research, develop, demonstrate, and deploy unique technology solutions to offshore wind’s most challenging problemsoffshore wind s most challenging problems

“DOE as a non regulatory agency is in a unique position to provideDOE, as a non-regulatory agency, is in a unique position to provide national leadership through collaborative partnerships with other

federal agencies, the states, academia, and industry.” National Offshore Wind Strategy


- National Offshore Wind Strategy

Offshore Wind Innovation and Demonstration

54 GW at 7 c/kWh by 2030/k h b10 GW at 10 c/kWh by 2020

Reduce Cost of Energy

Promote Responsible Deploymentgy p y

Develop Innovative Technologies

Remove Market Barriers

Demonstrate Next Generation

Technology


TechnologiesTechnology

Funding Aligned with National Strategy

Close data gaps needed for efficient permitting;

Tension Leg Platform DemonstrationNext Generation efficient permitting;

develop cost-competitive O&M strategies;

Wind/Wave Hybrid Floating Platform Prototype Launch

Deep Water Platform Designsg

transmission and interconnection planning Modeling and Data Analysis Support

gDemonstration

ModelingD t C ll tiData Collection

and Analysis

$15.5M


$


Close data gaps needed for efficient permitting;

Market and Economic AnalysisRemove Market efficient permitting;

develop cost-competitive O&M strategies;

Environmental Risk Reduction

Manufacturing and Supply Chain Development

BarriersSiting and Permittingg

transmission and interconnection planning

Manufacturing and Supply Chain Development

Transmission Planning and Interconnection Studies

PermittingInfrastructure

Resource Planning

Optimized Infrastructure and Operations

$16 5M

Planning

Resource Characterization and Design Conditions

Impact on Electronic Equipment

$16.5M 22 Awards

3 Years


Impact on Electronic Equipment3 Years

MB 6.1 National Offshore Resource and Design Data Campaign

MB 6 2 Resource and

MB 2.2 Innovative Avian and Bat Monitoring Technologies

MB 5.3

MB 6.2 Resource and Design Conditions Measurement and Modeling

M k t B iInstallation, Operation and Maintenance Strategies

Market Barrier Removal Projects

MB 4.2 Utility Interconnection &

St ateg es

MB 2.1 Mid‐Atlantic Ecological Baseline Studies & Modeling

MB 4.1 National Off h Wi d G id

Integration Case Studies

MB 5.2 Optimized Vessels Assessment

MB 7.0 Impact on Electronic Equipment in the Marine Environment

Offshore Wind Grid Integration Study

MB 3.0 Manufacturing and SupplyMB 5.1 Optimized Ports MB 1.1 Annual

Market Assessment

MB 3.0 Manufacturing and Supply Chain Development

Optimized Ports Assessment


Develop modeling tools, optimized system designs, and

Modeling and Analysis Design ToolsDevelop Innovative y g ,

components necessary for long-term R&D to reduce cost of offshore wind

Innovative System Design StudiesTechnologiesComputational

Toolscost of offshore wind energy Innovative Component Development

ToolsTurbine DesignMarine Systems

Engineering

$26 5M

Engineering

$26.5M 19 Awards

5 Y13 | Energy Efficiency & Renewable Energy eere.energy.gov

5 Years

TD 3.0

TD 1.4 Coupled wind/wave simulation models

TD 1.1 Floating platform dynamics model

Technology TD 3.0 Advanced rotors and control systems

TD 1.5 Offshore wind plant array simulation models

gyDevelopment Projects

TD 1.2 Surface ice impact models

TD 1.3 mooring

j

TD 2.0 Offshore System Designs

and anchoring dynamics models

Hubs of Expertise:A National Investment


DOE’s RDD&D Portfolio

The Sum is Greater than its Parts

Commitment to National Strategy

Efficient Research Investments

Synergies Discovered

Opportunities Executed

A National Mobilization of Resources to Accelerate the Industry


y

Industry in Action

Plant the seed with funding awardsawards

Facilitate research synergies

Build hubs of expertise

Capitalize on lessons learned in Europe

Empower economic revitalization

54 GW by 2030


y

Thank you

Christopher G. HartOffshore Wind ManagerOffshore Wind Manager

Wind and Water Power Program


European Update and Lessons for the US Offshore wind marketOffshore wind market

M A R I A S C A R L E T T

8 N O V E M B E R , 2 0 1 1

UK background information

• UK’s government offshore wind target 11GW to 18GW by 2020.

20

• Renewables Obligation (RO) legislation is the main mechanism for incentivising deployment of large scale renewable electricity in the UK.

• The RO Requires electricity suppliers to submit a number of renewable obligation certificates (ROC) in respect of each megawatt hour of g ( ) p gelectricity they supply or pay a buy out price.

• Since 2002, the RO has been successful in tripling the level of renewable electricity in the UK from 1.8% to 6.64%.

h C li i G h i d • The Coalition Government say they are committed to support mechanisms through the Electricity Market Reform.

• Market uncertainty till end of 2012 and conclusions of the market reform. Risk of damage to investor confidence.g

• ROC banding review published recently (12 October, 2011)

• Government propose to establish an industry led task force to reduce the costs (development, construction and operations) of offshore wind to £ /MWh b £100/MWh by 2020.

Europe background information

March 2007 – 27 European U i H d f St t d

21

Union Heads of State agreed a binding target of 20% renewable energy in 2020.

The 2009 Renewable Energy Directive requires all Member States to submit National Renewable Energy Action Plans (NREAPs) to the European Commission by 30 June 2010.

By 4 January 2011, all 27 NREAPs had been submitted.

C t f EWEACourtesy of EWEA Pure PowerWind energy targets for 2020 and 2030A report by the European Wind Energy Association - 2011

Europe offshore wind power 201022

Table courtesy of Pure Power report - EWEA

Barriers to development

Europe

Project developers need to obtain permits in order to install a wind farm and obtain

23

grid connection. Based on the European Wind European Association Wind Barriers survey, the average total lead time in the EU is 54.8 months for onshore and 32 months for offshore.

Reasons for the long lead times vary from country to country, but they are often related to Environmental Impact Assessment (EIA) restrictions and/or grid connection constraints.

Six countries in the survey seem to have developed efficient and streamlined decision-making processes, including Maritime Spatial Planning (MSP) which accounts for less delays. The UK is currently working on MSP.

UK

The Planning Act 2008.

L li Bill i i i i i h l i Localism Bill - more power to communities to participate in the planning process.

Key message – Improve Grid processes

An absence of clear information on the available grid connection capacity, a lack of planning for future grid extension and reinforcements on behalf of system operators, p g g y p ,insufficient grid capacity, and other aspects such as land ownership and the EIA result in delays. In the UK, National Grid are working to resolve these issues.

Obstacles to wind farm development24

Courtesy of EWEA – WindBarriers report, July 2010

Administrative recommendations for the USA

Clear Government targets for Renewable Energy.

Set deadlines for the administrative process If the authority is not able to meet the

25

Set deadlines for the administrative process. If the authority is not able to meet the deadline, the project automatically goes to the next stage

Train and allocate the necessary civil servants to handle the expected applications

Lower the average administrative costs to 1.5% of the total project costsLower the average administrative costs to 1.5% of the total project costs

Give incentives to competent authorities to gather data and studies both externally collected and from the EIA process and make them public (similar to COWRIE in the UK)

Learn from past projects in the UK and Europe

For offshore, maritime spatial planning – encourage and facilitate cross border cooperation

Develop synergies with other sea users & shipping and navigation guidance

Disseminate transparent and unbiased information to the authorities and decision making bodies at all levels on wind energy technology and developments, addressing the myths associated with wind energyt e yt s assoc ated w t w d e e gy

Transferable consents

Transfer of knowledge

Strategic Energy Technology Plan

26

g gy gy

European Wind Energy Technology Platform

Several Member States have conducted comprehensive research programmes on offshore wind. Example – COWRIE (The Crown Estate)

http://www.offshorewind.co.uk/Pages/COWRIE/

Partnerships – example - The Carbon Trust (UK)

h i l i d h l i hi i d iThe Marine Energy Accelerator was aimed at helping achieve marine energy cost reduction through:

Developing new device concepts that could significantly marine energy lower costs

Research into lowering costs of specific components in existing marine energy devices g p p g gy

Developing strategies on how to improve ways marine energy devices can be installed, operated and maintained at a lower cost.

G d P ti Wi d E U i /S tti h G t j tGood Practice Wind – European Union/Scottish Government project

Carbon Trust Offshore wind acceleratorCarbon Trust Offshore wind accelerator

The research and development programme has four areas:

27

programme has four areas:

Developing new turbine foundations and installation techniques.

Facilitating access to distant turbines for maintenance.

Finding the best wind farm array Finding the best wind farm array layouts to optimise yield.

Researching ways to reduce electricity transmission losses. y

These research areas were chosen as they represented the greatest potential for reducing the total cost of constructing the total cost of constructing, operating, and financing large offshore wind farms.

Pictures Courtesy of The Carbon Trust

PwC Outlook survey results

Risk and investment:

28

Among financial institutions, perceptions of offshore wind development risk as a barrier to investment are improving and becoming positive.

Supply chain management: pp y g

Nearly all (91%) developers said supply chain capacity constraints are a significant problem for offshore wind construction and 55% think supply chain risks are likely to increase in the future.

Key issue: Suitable Ports, absence of a local supply chain, long lead time for items e.g. Strategic investment required.

Government support and regulatory certainty:

The survey highlights a gap between government and industry expectations.

PwC’s Offshore Proof survey, 2011

Thank you

Additional information

29

http://www.bwea.com/pdf/publications/RebirthVol2.pdf

http://www.ewea.org/fileadmin/ewea_documents/documents/publications/reports/OffshoreGrid__report.pdf

http://www.raeng.org.uk/news/publications/list/reports/Offshore_wind.pdf

http://www.ewea.org/fileadmin/ewea_documents/images/publications/offshore_report/ewea-offshore_report.pdf

htt // b t t k/ i t h l i / t f / i http://www.carbontrust.co.uk/emerging-technologies/current-focus-areas/marine-energy-accelerator/pages/default.aspx

http://www.project-gpwind.eu/

Contact information

[email protected]

Any Questions?

30

Any Questions?

2010 European union wind summary2010 European union wind summary31


2020 European union wind forecast2020 European union wind forecast32


Offshore Wind Turbine TechnologyChris Elkinton, Strafford Webinar, 08 November 2011

E t i blExperts in renewable energy

Onshore & Offshore Wind Wave & Tidal Solar PV & CSP

34

G hi l hGeographical reach• 775 staff, in 43 locations, across 23 countries

Glasgow

HeerenveenSint Maarten

Kaiser-Wilhelm-Koog

Copenhagen

BristolDublinVancouver

Ottawa

BeijingSeoulTokyo

Paris

CopenhagenHinnerupOldenburgHamburgWarsawImola

LondonSlough

PortlandSan Diego

MontrealPeterborough

ShanghaiMumbaiBangaloreNewcastle

IzmirCairo

LisbonBarcelonaZaragozaMadrid

AustinMonterrey

Porto AlegreSantiago

MelbourneWellington

35

A Key market driversON

TENT

B Overview of offshore wind turbine technology

CO

C Key technology trends and hurdles

36

M k t I tiMarket Incentives Federal

• Production Tax Credit (PTC) – set to expire end 2012Production Tax Credit (PTC) set to expire end 2012• Investment Tax Credit (ITC) – must be in service by end 2012• DOE research funding ($43m awarded Sept. 2011)• Offshore-specific incentives in the worksOffshore specific incentives in the works

– The Incentivizing Offshore Wind Power Act (H.R.3238) – 30% tax investment credit on first 3 GW offshore wind

St t State• 36 states + DC have state-level incentives• Of these, 29 states + DC have mandatory Renewable Portfolio Standards (RPS)• Of these, 14 Coastal states + 7 on the Great Lakes

Power purchase agreements (utilities / off-takers) Wind resource

37

Wind resource

M k t B iMarket Barriers Price certainty

• Competition with onshore wind, natural gas, hydroCompetition with onshore wind, natural gas, hydro• Large construction costs• PPAs – need secure off-takers• First US projects paving the wayFirst US projects paving the way

Permitting / consenting certainty• Not streamlined (e g Cape Wind 17 state & federal agencies reviewing)• Not streamlined (e.g. Cape Wind – 17 state & federal agencies reviewing)• State, federal• Numerous commenting agencies involved• At least 5 years for BOEM from time proposal is submitted to final permit• At least 5 years for BOEM from time proposal is submitted to final permit

Unstable federal incentives environment

38


TENT


CO


39

General O er ie of Wind T rbine TechnologGeneral Overview of Wind Turbine Technology Project anatomy

40

General O er ie of Wind T rbine TechnologGeneral Overview of Wind Turbine Technology Rotor-Nacelle Assembly: Siemens 3.6 MW wind turbine

1 Spinner 2 Spinner bracket 3 Blade 4 Pitch bearing

5 Rotor hub 6 Main bearing 7 Main shaft 8 Gearbox

41

9 Service crane 10 Brake disc 11 Coupling 12 Generator

13 Yaw gear 14 Tower 15 Yaw ring 16 Oil filter

17 Generator fan 18 Canopy

General O er ie of Wind T rbine TechnologGeneral Overview of Wind Turbine Technology Support Structure – current state of the art

Source: www.wind-energy-the-facts.org

42

Source: www.wind energy the facts.org

Ke Differences Offshore & OnshoreKey Differences – Offshore & Onshore Generally same overall turbine design

• Rotor, nacelle, towerRotor, nacelle, tower• …but “marinized” Different foundation concepts Size matters Size matters Reliability is especially critical to offshore Support infrastructure, e.g. access to turbines Cost

• Onshore: turbine ≈ 75-85% total Capex, foundation ≈ 5%• Offshore: turbine ≈ 50% total Capex, foundation ≈ 20%• COE: offshore wind approx. 2X onshore wind

43


TENT


CO


44

Technolog TrendsTechnology Trends Growth of wind turbine systems

1960, 24m →

45

2007, 126m diameter

Technolog TrendsTechnology Trends Larger machines

• Now: 5-6 MW with 120-126 m rotor diameters126m68m

164m

Now: 5 6 MW with 120 126 m rotor diameters• Short-term: 6-7 MW with 126-164 m rotor diameters • Mid-term: 8-10 MW with 150+ m rotor diameters• Long-term: ??

68m

Long term: ??

Spruce Goose 97.5m span

An-225 Mriya 88.4m span

Airbus A380 79.8m span

Boeing 747-8 68.5m span

46

Technolog TrendsTechnology Trends Deeper water

• Most projects installed to date are in waters 8-25 m deepMost projects installed to date are in waters 8 25 m deep• Current technology allows installation to approx. 50 m• Future may include floating platforms – currently in prototype testing Alternative drive trains Alternative drive trains

• direct drive (no gearbox)• split load path gearboxes with multiple generators• hybrid gearbox generator• hybrid gearbox-generator

47

Source: MTorres Source: Clipper

Technolog H rdlesTechnology Hurdles Lack of universally accepted design standards (especially in US) Supply chain constraints (large bearings monopiles)Supply chain constraints (large bearings, monopiles) Reliability – tower access constraints Knowledge of offshore wind construction deployment and logistics in North America

15 25% f C• 15-25% of Capex Limited room for OEM to reduce costs; more room within BoP Risks to financing:

• weather (access)• technology / performance• grid reliability

48

Thank you for listening

Chris Elkinton

[email protected]

The State of the States:The State of the States:The Impact of Governors’ Support,

Legislation and other Factors on U SLegislation, and other Factors on U.S. Offshore Wind Development

ByKimberly E. Diamond

November 8, 2011

Strafford WebinarOffshore Wind: Emerging Legal ChallengesOffshore Wind: Emerging Legal Challenges

State Renewable Portfolio Standards (RPS)State Renewable Portfolio Standards (RPS)

• Most states have an RPS• Most states have an RPS, or an RPS‐like goal

• A state RPS generally i i t t tiliti trequires in‐state utilities to

purchase a certain percentage of energy

i i fgeneration capacity from renewable energy sources by a certain future date

• Carve‐outs exist for specific resources, such as windGraphic courtesy of the Pew Center on Global Climate Change, last

Diamond 51

updated Oct. 12, 2011, http://www.pewclimate.org/what_s_being_done/in_the_states/rps.cfm

Who Controls the Seabed Differs B d h SBased on the State

• Important for Where Demo Projects are Sited

• Texas• Coastal Public Lands Management Act of 1973Coastal Public Lands Management Act of 1973

• Jurisdiction over submerged lands extends 10.35 miles out into the Gulf of Mexico

• Same boundary as in 1845, when Texas was an independent nation

• Texas General Land Office (“GLO”)• Issues Leases

• U.S. Army Corps of Engineers• Issues Permits

Diamond 52

Texas – No Federal Permits NeededTexas No Federal Permits Needed

• Texas (continued)Texas (continued)• 1899 Rivers and Harbors Act

• U.S. Army Corps of Engineers administers re: course, condition,or capacity of a port, harbor, or channel

• Federal Energy Regulatory Commission (“FERC”)• FERC permit not necessaryFERC permit not necessary

• Bureau of Ocean Energy Management (“BOEM”)• BOEM permit not necessary

Diamond 53

Example – Baryonyx ProjectsExample Baryonyx Projects

Photo courtesy of Baryonyx, “Projects” at http://baryonyxcorp.com/projects.html

Photo courtesy of Baryonyx, “Rio Grande Project” at http://baryonyxcorp.com/rio_grande_project.html

• Rio Grande North and Rio Grande South Projects• Texas state waters; 5 miles from TX coast; 160 turbines; 1.0 GW

j• Mustang Project• Texas state waters; 6 miles from TX coast; 200 turbines; 1.2 GW

Diamond 54

Example – Coastal Point EnergyExample Coastal Point Energy

• Galveston Wind ProjectGalveston Wind Project• 8.5 miles from TX coast

• Projected 300 MW capacity

• All necessary permits have been receivedhave been received

• Austin Energy PPA

• Four other proposedFour other proposed projects

Diamond 55

Control of Seabed – Atlantic CoastControl of Seabed Atlantic Coast

• East Coast States –St t t l th E t C t d diff tl th• State waters along the East Coast are measured differently than in Texas

• State Waters = Area between shoreline and 3 nautical miles out• State Waters = Area between shoreline and 3 nautical miles out

• Federal Waters = Area from 3 – 200 nautical miles out (this is the Outer Continental Shelf, or “OCS”)(this is the Outer Continental Shelf, or OCS )

• Important from the perspective of where demonstration projects are being sited

• State waters, rather than federal waters, are preferable• Fewer permits are required• Less administrative wait‐time

Diamond 56

• More expedited process for getting steel in the water

Example – Fishermen’s Energy Demo Project in N JNew Jersey

• 6‐turbine, 24 MW project

• In state waters, 2.5 miles of NJ coast, near Atlantic City, NJ

• NJ Board of Public Utilities (“BPU”) is reviewing

• Precursor to a Fishermens’ Energy project 10 times as large gy p j gin federal waters

• Fishermens’ Energy and 10 other developers applied for federal p ppleases in June 2011 to build in federal waters of NJ’s coast

Photo courtesy of Atlantic CVB

Diamond 57

Legislative Constructs –OREC R h h PPAORECs, Rather than PPAs

• NJ’s Offshore Wind Economic Development Act (“OWEDA”)p ( )• Enacted on August 19, 2010• Intended to support the development of 1,100 MW

offshore wind generationoffshore wind generation• OWEDA directs the NJ Board of Public Utilities (“BPU”) to

establish an OREC (Offshore Renewable Energy Credit) program

• NJ is the only state that has ORECs• ORECs can be used to meet NJ’s state RPS• ORECs may be used during the energy year they are

issued, and for two years thereafter• All other states use PPAs (Power Purchase Agreements)

Diamond 58

• All other states use PPAs (Power Purchase Agreements)

Utilities – What Role Should They PlayUtilities What Role Should They Play• Utilities Overseas – Serve

as a partner or parentp p

• Skin in the Game

• Utility shares the substation development costs

• There is an element of• There is an element of cost structure control

• The utility’s balance

Photo from Michael Hanibal, Siemens Wind Power A/S, presentation at AWEA’s Offshore WINDPOWER 2011

Example Garden State Offshore Wind in NJy

sheet assists in the project’s financial risk mitigation

Example – Garden State Offshore Wind in NJJoint venture partnership between • Public Service Enterprise Group (PSE&G)• Deepwater Windmitigation

Diamond 59

Example – Deepwater Wind’s Block Island P j i Rh d I l dProject in Rhode Island

• Rhode Island’s Law relating to Public Utilities and Carriers –Contracting Standard for Renewable Energy (formerly gy ( yH 8083 Substitute A & S 2819 Substitute A)

• This law is geared specifically• This law is geared specifically toward the 28.8 MW Block Island offshore wind project

D E Sh Fi i l b k• D.E. Shaw – Financial backer of the Block Island Project

Diamond 60

Picture courtesy of Daily Kos, located at http://www.dailykos.com/storyonly/2010/3/8/844165/-Offshore-wind-farm-constructionmore-pictures

Rhode Island’s Law re:D Wi d’ Bl k I l d P jDeepwater Wind’s Block Island Project

• General Assembly’s Original Intent• Enco rage and promote clean rene able energ thro gh a• Encourage and promote clean, renewable energy through a

demonstration‐sized offshore project• Have the additional benefit of attracting jobs and investment

dollars of offshore wind turbine manufacturers bladedollars of offshore wind turbine manufacturers, blade manufacturers and related businesses

• PPA between Deepwater Wind and National Grid (a Utility)• Filed with the RI Public Utilities Commission (PUC)Filed with the RI Public Utilities Commission (PUC)• Requires the RI Economic Development Corporation and the RI

Department of Environmental Management to offer testimony before the PUC on the economic development and environmental pbenefits of the project

• Lawsuit Challenging PPA Defeated• In July 2011, RI Supreme Court upheld the PPA, stating that the PUC

Diamond 61

y , p p , gacted in accordance with state law when it approved such PPA

Managing Public Opinion by Community EEngagement

• Engage Local Community Early in the Process• Gain Public Buy‐In• First Mover Advantage –

• Most people believe what they hear firstMost people believe what they hear first• Being the first to get the word out is better than running damage control

• Transparency Inform the immediately impacted• Transparency – Inform the immediately impacted community of the following:

• Federal and state agencies involved• Any local community governmental entities involved• Manage public expectations• Public benefits – jobs, helping state meet RPS

Diamond 62

Public benefits jobs, helping state meet RPS

Example – Lack of Substantial Public Buy‐InC Wi d P j i MACape Wind Project in MA

• 420 MW project in Horseshoe h l k dShoal, Nantucket Sound, MA

• Has all necessary permits• Siemens, its turbine supplier, pp

expressed interest in financing the project

• Still need a buyer for 50% of G hi t f Wiki dienergy Graphic courtesy of Wikipedia, http://en.wikipedia.org/wiki/Cape_Wind

• Significant legal appeals by multiple partiesAlli t P t t N t k t S d• Alliance to Protect Nantucket Sound

• Associated Industries of MA• Martha’s Vineyard/Dukes County Fishermen’s Association• New England Power Generators

Diamond 63

• New England Power Generators• Wampanoag Tribe of Gayhead/ Aquinnah• Town of Barnstable

Example – Benefits of Extensive Public OutreachNRG Bl t Wi d’ Mid Atl ti Wi d P k DENRG Bluewater Wind’s Mid‐Atlantic Wind Park, DE

• Law Signed in April 2006, Amending Electric Restructuring Act of 1999• Includes provisions designed to stabilize electricity pricing forIncludes provisions designed to stabilize electricity pricing for

consumers during the long and short terms• The Act provides for contracting with Delmarva Power through a

request for proposals (“RFP”) process to build cost‐effective energy generation

• Delmarva Power Issued an RFP for New Power Plant, November 2006• Bluewater Wind submits a proposal• Four (4) state agencies evaluate the proposal

• Delaware Public Service Commission (“PSC”)• Delaware Energy Office• Office of Management and Budget• Office of Management and Budget• Controller General’s Office

• Bluewater Wind is directed to negotiate a PPA with Delmarva Power by the PSC and other state agencies

Diamond 64

Power by the PSC and other state agencies• PPA is signed; approval received from PSC in June and July 2008

NRG Bluewater’s Mid‐Atlantic Wind Park in D lDelaware

• Massive Amounts of Public OutreachR l d i i bli• Resulted in unanimous public support

• Location and Size• 13 miles off the Delaware coast• Will initially generate 200MW• Will have a potential expanded size of 450 MWWill have a potential expanded size of 450 MW• Secured the nation’s first offshore PPA in August 2010

Diamond 65

Wind Energy Areas (“WEAs”)S t f th I t i K• Secretary of the Interior, Ken Salazar, Identified Wind Energy Areas (“WEAs”) on the Outer Continental Shelf along the AtlanticContinental Shelf, along the Atlantic Coast, stretching from New Jersey to Virginia

• Theses designations are part ofTheses designations are part of The Department of Interior’s Smart from the Start plan announced in November 2010. For the designated areas, coordinated environmental studies, large‐scale planning and expedited approval processes will be used to speed offshore wind energy development.

• The areas are of the coasts of NJ (417 ti l il ) DE (122) MD

Diamond 66Map courtesy of the Department of Interior, http://www.doi.gov/news/pressreleases/upload/mid_atl_wea_02‐03‐11.pdf

square nautical miles), DE (122), MD (207), and VA (165)

Maryland – On the Cusp of Passing Offshore Wi d L i l iWind Legislation

• Governor Martin O’Malley• Governor Martin O Malley• Staunch supporter of offshore wind development• Has challenged the federal government to work with him to build over 1 GW of offshore wind in theMid‐Atlantic Region

• Strong proponent of MD’s H.B. 1054 and S.B. 861Picture courtesy of Wikipedia, http://en.wikipedia.org/wiki/File:Flag_of_Maryland.svg

• MD H.B. 1054 and S.B. 861 – Maryland Offshore Wind Energy Act• Introduced in February 2011• Would require the development of 400 MW – 600 MW of offshore wind capacity

l M l d’

y g

along Maryland’s coast• Would require the Maryland Public Service Commission to order certain MD utilities to enter into long‐term PPAs

• In October 2011, Maryland General Assembly’s house Economic Matters

Diamond 67

, y yCommittee discussed how to kick‐start the development of a wind farm off of Maryland’s coast (500 MW project would power 80% of Eastern Shore homes)

Virginia – Where Legislation Will Follow the S l Ch i f Off h Wi d D lSupply Chain for Offshore Wind Development

• Offshore Wind Progress in Advance of Law b h l l b l dFeb. 2011 ‐ Gamesa Technology Corp., a global wind

energy leader, and the shipbuilding operations of Northrop Grumman Corp., the largest U.S. shipbuilder launched the National Offshore Wind Technologylaunched the National Offshore Wind Technology Center in Hampton Roads, VA to jointly develop offshore wind systems to be deployed in the United States and around the world.

Graphic courtesy of WorldAtlas.com, http://www.worldatlas.com/webimage/countrys/namerica/usstates/lgcolor/hamptonroads.

• Gamesa/Northrop Grumman Project Supported by • Virginia Governor Bob McDonnell • Commonwealth of Virginiarys/namerica/usstates/lgcolor/hamptonroads.

htmg

• Goal to be Energy Capital of the East Coast for the Offshore Wind Industry

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Virginia – Passage of Several Laws Supporting Off h Wi d D lOffshore Wind Development

• Law Creating Virginia Offshore Wind Development Authority• Virginia House and Senate vote unanimously to pass HB 389 and SB 577g y p• April 2011 ‐ Governor Bob McDonnell signs the bills into law

• The Authority has the Ability to:• Create public/private partnerships for data collection and infrastructure upgradesinfrastructure upgrades

• Apply for federal loan guarantees• Take state‐level actions to facilitate the offshore wind industry’s

growth• Law Increasing Weight of Offshore Wind Energy Renewable Energy Credit

• Virginia House and Senate vote unanimously to pass HB 1022• April 2011 ‐ Governor Bob McDonnell signs this bill into law

• Main Feature of this Law:• Main Feature of this Law:• Increases the renewable energy credit for offshore wind energy to meet Virginia’s RPS

• Credits for offshore wind are worth triple the standard

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amount; previously, all solar and wind credits were worth double the amount of credits as other renewables

ConclusionsConclusions• Offshore wind demonstration projects along the upper East Coast and

actual large wind farm projects in the Gulf of Mexico are being sited in state, rather than federal, waters to expedite the permitting process and get steel in the water.

• Certain states (such as RI NJ and VA) have enacted laws specifically• Certain states (such as RI, NJ, and VA) have enacted laws specifically geared to promote the development of an offshore wind industry.

• Having the support of the Governor from a particular state is a key factor in the implementation of legislative and other measures in that state that support offshore wind power development.

• Consensus building and public buy in at an early stage is crucial for• Consensus building and public buy‐in at an early stage is crucial for proactively minimizing opposition to offshore wind farm development.

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Thank YouThank You

Kim Diamond

kdi d@l [email protected]

(646) 414‐6980(646) 414 6980

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