Regulators Approve First Offshore Wind Farm in U.S.

By KATHARINE Q. SEELYE
Published: April 28, 2010



BOSTON — After nine years of regulatory review, the federal government gave the green light Wednesday to the nation’s first offshore wind farm, a highly contested project off the coast of Cape C
Cape Cod Project Is Crucial Step for U.S. Wind Industry (April 27, 2010)
Pressure Is Building on Disputed Wind Farm (April 26, 2010)
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The approval of the 130-turbine farm gives a significant boost to the nascent offshore wind industry in the United States, which has lagged far behind Europe and China in harnessing the strong and steady power of ocean breezes to provide electricity to homes and businesses.

With Gov. Deval Patrick standing beside him, Interior Secretary Ken Salazar announced at a news conference at the Massachusetts Statehouse that the government had approved a permit for Cape Wind Associates, a private venture, to build the farm.

“I am approving the Cape Wind project,” Mr. Salazar said. “This will be the first of many projects up and down the Atlantic coast.”

The Cape Wind turbines would lie in Nantucket Sound, about five miles from the nearest shoreline, and cover 24 square miles, roughly the size of Manhattan. The tip of the highest blade of each turbine would reach 440 feet above the water.

But the project is hardly shovel ready. Several regulatory hurdles remain, and opponents of the wind farm have vowed to go to court, potentially stalling Cape Wind for several more years.

For years the Cape Wind project has been the focusof pitched battles splitting politicians and environmental groups. While some environmentalists are prepared to go to court to stop the project, other major groups, including the Sierra Club and Greenpeace, support it.

Senator Edward M. Kennedy of Massachusetts, whose family compound overlooks Nantucket Sound and who died last year, had opposed the project, saying it was a giveaway to a private developer.

Senator Scott Brown, Republican of Massachusetts, issued a statement opposing the decision immediately after it was announced, saying it would hinder tourism and boating in the area.

But Mr. Patrick, also a Democrat, has supported it.

“America needs offshore wind power, and with this project, Massachusetts will lead the nation,” Mr. Patrick declared at the Statehouse on Wednesday. While there are differences of opinion, he said, “on balance, Cape Wind is good for our environment and good for our energy needs.”

He added that construction could begin within a year. “We are on our way,” he said. “If we get clean energy right, the whole world will be our customer.”

Ian Bowles, secretary of the Massachusetts executive office of environmental affairs, called the announcement “the shot heard ’round the world for American clean energy.”

At least half a dozen offshore wind farms have been proposed along the East Coast and the Great Lakes. Their relatively shallow waters make wind energy more feasible than off the West Coast, where the ocean floor drops off precipitously.

Supporters say the $1 billion Cape Wind project would provide a clean, renewable source of energy that could meet up to 75 percent of the power needs on Cape Cod, Martha’s Vineyard and Nantucket. They also say it would provide hundreds of construction jobs, decrease the region’s reliance on fossil fuels and benefit the environment by lowering emissions of greenhouse gases.

Opponents say it would be an industrial blot in an area of pristine beauty and change the region’s historic character. They also warn that the costs to consumers are likely to be double or triple the costs for conventional power. Improvements to the region’s electrical grid and transmission lines could cost $10 billion.

Audra Parker, president and chief executive of the Alliance to Protect Nantucket Sound, said that several groups would go to court to halt the project. While the permit is “a significant piece of the puzzle,” she warned, other pieces must still be put in place to get the project under way.

The Federal Aviation Administration has yet to make a final determination on the project, which it has rated “a presumed hazard” because of potential interference with airplane radar, she said. And Cape Wind has yet to sign a contract with the local utility, National Grid, to carry the wind power, she noted.

She said that nine state and local permits were still being appealed in the courts. And nearly a dozen parties have filed notices of intention to sue, saying the project violates various environmental rules and regulations.

Asked about future hurdles, Mr. Salazar said, “This is the final decision of the United States of America.” While delays could result from challenges, he said, he was “confident” that the courts would uphold his decision.

Officials said the official record of the decision, to be made available later, would spell out ways in which the government could mitigate any negative effects on coastal views by adjusting he number, orientation and color of the turbines.

The coastal Wampanoag tribe, which requires unobstructed views of the sunrise for sacred ceremonies, said Monday that it was preparing to challenge the project for violations of tribal rights.

“We will not stand by and allow our treasured public lands to be marred forever by a corporate giveaway to private industrial energy developers,” Ms. Parker said.

Chinese Turbines Spun by Texas Winds Spur ‘Buy American’ Push

April 13 (Bloomberg) -- Chinese turbines powered by west Texas winds are sparking a debate over whether “Buy American” rules should be imposed on renewable-energy investments backed by the U.S. government.

A-Power Energy Generation Systems Ltd., based in Shenyang, China, will supply turbines to a joint venture planning to build a $1.5 billion wind farm using equipment made in China. The group, which includes two U.S. partners, says it may seek financial aid from the Obama administration because the project will create at least 1,000 American jobs.

Lawmakers led by U.S. Senator Charles Schumer, a New York Democrat, say such assistance amounts to subsidizing green jobs outside the country. They want to slap made-in-America requirements on renewable-energy initiatives aided by the U.S., like those already faced by highway and water-treatment projects helped by President Barack Obama’s $787 billion economic stimulus plan.

“Congress is feeling pressure to make sure they won’t be held accountable for green jobs going overseas,” said Kevin Book, a managing director for Clearview Energy Partners LLC, a Washington-based policy research firm.

Buy-American restrictions may be added to climate legislation that will be introduced in the Senate as early as next week, Book said.

GE’s View

Producers of renewable-energy equipment, led by General Electric Co., the biggest U.S. maker of wind turbines, say such restrictions would hurt their ability to compete in a global clean-energy market that relies on parts from many countries. Buy-American provisions may cause other nations to retaliate by curbing their use of U.S. products, shrinking domestic job creation tied to exports, GE says.

The wind industry will create 20,000 U.S. jobs in the next decade and would generate more if the U.S. adopted clear policies and incentives for clean energy, such as requiring the use of power generated from renewable sources, said Steve Bolze, head of GE’s power and water unit.

“What the U.S. needs, which Europe, China and other countries have, is stable, long-term policy,” Bolze said in an interview.

Fairfield, Connecticut-based GE, the world’s No. 2 maker of wind turbines after Denmark-based Vestas Wind Systems A/S, is planning to invest 340 million euros ($462 million) in developing and expanding wind-turbine operations in the U.K., Germany, Norway and Sweden, creating a total of more than 2,000 jobs in those countries, Bolze said.

A-Power’s Turbines

“We need to be very, very careful about any kinds of protectionist measures” in clean energy, Commerce Secretary Gary Locke said in an April 8 interview.

The Texas project’s U.S. partners announced the 600- megawatt wind farm in a statement on Oct. 29. A-Power was “designated as the wind-turbine supplier for this high-profile project,” John Lin, the company’s chief operating officer, said in the statement.

The U.S. Renewable Energy Group, a Washington-based private- equity firm, and closely held Cielo Wind Power LP of Austin, Texas, are in the joint venture with Shenyang Power Group, a Chinese energy alliance that has A-Power as its biggest investor.

Schumer criticized the use of Chinese-made turbines at the time, and last month joined Democratic colleagues in introducing legislation that would make the Texas wind farm and projects like it that are dependent on foreign manufacturing ineligible for stimulus aid.

‘Can’t Sit Idly’

“We can’t sit idly by while China races to the forefront of clean-energy projects at the expense of U.S. manufacturing, U.S. jobs and U.S. energy independence,” Democratic Senator Sherrod Brown of Ohio, a cosponsor, said in a statement March 3. “And we certainly can’t shoot ourselves in the foot by helping to finance Chinese clean-energy production.”

Asia makes more than half the world’s wind and solar energy equipment and is widening its lead. China invested $34.5 billion in low-carbon energy technologies last year, according to Bloomberg New Energy Finance. The U.S. spent $18.6 billion.

Partners in the Texas wind farm will fully fund the project and construct the plant using only American labor, according to Ed Cunningham, a managing partner with the U.S. Renewable Energy Group.

“We will then have the opportunity to apply for incentives,” Cunningham said in an e-mailed statement on March 22. “All incentives would be repaid within just a few years through the federal taxes generated by the wind farm, and this doesn’t include the value tied to the thousands of high-paying, stable American jobs.”

BP, First Solar

The Buy American debate is growing as companies move renewable-energy jobs away from the U.S.

London-based oil company BP Plc said on March 26 that it’s ending U.S. production of solar panels at a plant in Frederick, Maryland, cutting 320 jobs, as it shifts production to joint ventures in China and India.

Tempe, Arizona-based First Solar Inc., which received $16.3 million in federal funds to hire 200 people at an Ohio plant, plans to do 71 percent of its manufacturing hiring in Malaysia, based on a company presentation to analysts in December.

As of mid-March, at least $1.6 billion of $2.7 billion in U.S. stimulus grants for clean-energy projects went to companies based outside the U.S., according to Denise Heckbert, an analyst in Toronto with Bloomberg New Energy Finance. Spain-based Iberdrola SA received $577 million and Germany’s E.ON AG is getting $324 million, she said.

“It doesn’t look good on paper, but actually the funds are supporting a substantial number of U.S. jobs,” she said. That’s a theme sounded by energy companies opposed to Buy American restrictions.

70% U.S.-Made

Partners in the 36,000-acre Texas wind farm, which would power 180,000 homes, have emphasized that the “vast majority” of jobs would go to Americans.

“A minimum of 70 percent of each wind turbine, including the massive towers and blades, will be wholly manufactured in the United States and made of American steel,” the U.S. Renewable Energy Group said in a statement on its Web site.

Half of the parts used in GE wind turbines are made in the U.S., up from 20 percent a few years ago, according to Kevin Walsh, managing director of renewable energy at GE’s financial services unit.

The Obama administration shares Schumer’s goal of ensuring that government aid creates U.S. jobs, said Matt Rogers, a senior adviser at the Energy Department.

“The good news is these programs have worked to create jobs and bring in a lot of foreign investment to the U.S.,” Rogers said in an interview. Two programs under the stimulus act aimed at promoting renewable energy have created or saved more than 20,000 U.S. jobs, according to the Energy Department.

Tax Credit

Obama’s request to extend a manufacturing tax credit for renewable-power companies is aimed at ensuring the industry moves in the same direction as automakers, which “run at about 70 to 75 percent U.S. domestic content,” Rogers said.

Concern that most wind-power jobs will flow overseas is exaggerated because of the heavy equipment required, said Walter Hornaday, president of Cielo Wind Power.

“It doesn’t make sense to haul 400,000 pounds of equipment around on the open ocean,” Hornaday said.

To contact the reporter on this story: Kim Chipman in Washington at kchipman@bloomberg.net.

Last Updated: April 13, 2010 00:00 EDT

Virginia Creates Offshore Wind Authority

By . IW Staff
April 5, 2010

The state will also upgrade port facilities to accommodate the manufacturing and assembly of offshore wind energy project components.




On April 2, Virginia Gov. Bob McDonnell signed legislation that establishes the Virginia Offshore Wind Development Authority. The authority would promote the development of the offshore wind industry in Virginia and identify potential barriers to wind energy development, among other things.

The Commission is charged with, among other tasks, (i) collecting metocean data, (ii) identifying existing state and regulatory or administrative barriers to the development of the offshore wind industry, (iii) upgrading port facilities to accommodate the manufacturing and assembly of offshore wind energy project components and vessels that will support the construction and operations of offshore wind energy projects, (iv) securing federal loan guarantees, and (v) developing, constructing, and operating interconnection facilities on the Virginia shoreline to connect offshore wind energy projects to the electric grid.

"As a company that is carefully examining the feasibility of building wind farms offshore, Dominion is pleased that Gov. McDonnell has signed legislation creating the Virginia Offshore Wind Development Authority. To meet future electric demand in Virginia, the state needs a variety of generating sources, including wind. The authority will address critical issues -- such as transmission capability and installation of meteorological towers -- that could pave the way for wind energy development off the coast of Virginia," said Mary C. Doswell, senior vice president-Alternative Energy Solutions.

Dominion owns 282 megawatts of operational wind capacity -- 132 megawatts in Mount Storm, W.Va., and 150 megawatts in Fowler, Ind. The company is also in the early stages of developing additional wind generation in Illinois, Indiana and Virginia.