Last month, New Energy Updates by Reuters Events hosted the US Offshore Wind Virtual Conference.  This annual event, one of the best in the industry, is traditionally held in person in Boston, Massachusetts, in June, but was changed to a virtual event due to the COVID-19 pandemic. 

“There has never been a more important time for us to come together.  Amid such continuous change it is essential that we continue to collaborate, learn and network,” said John Harmon, introducing the event. 

SubCableWorld will be providing summaries of various panel discussions and presentations conducted during the event.  This one will cover two of them: State of the US Offshore Wind Industry 2020 and State Procurements for Offshore Wind.  While these did not specifically cover submarine cable issues the updates on the broader offshore wind market are valuable to the submarine cable industry. 

The first panel, State of the US Offshore Wind Industry 2020, featured executives representing leading suppliers and developers.  The following is a summary of some of their key comments. 

“We felt it critical to keep this conference on schedule,” said Tom Amis, Chair and Partner, Amis, Patel and Brewer, who moderated the session.  “The last year has really been seminal in the offshore wind industry in the United States.  This has always been a sector with tremendous promise.  We all know that the fundamental drive is a spectacular offshore wind resource with high capacity, close proximity to perhaps the greatest load pocket in the world for electricity demand, and an emerging consensus both at the federal and state level that this is an industry that needs to be supported.  This year feels different.  We’re moving from the aspirational to the concrete.  RFPs are being issued and awarded, leases are being signed and offtake agreements are being executed.  The latter is particularly important as revenue on the offtake side is the bedrock of the ability to finance a project.  The opportunities for this sector have never been greater.” 

“When we made the decision a few years back to go into offshore wind, we wanted to do it in a way in which we could make a difference,” said John Lavelle, CEO, Offshore Wind, GE Renewable Energy.  “Our contribution is technology.  We look to lower the costs of technology for developers.  The volume is what it takes to develop a supply chain.  Investors look for a sustainable flow of projects year after year.  That allows for standardization and efficiency in operation and that really drives down cost.” 

“Scale plays a huge role.  We are the second-largest offshore wind operator in the world, next to Orsted, and we have big ambitions related to that,” said Sven Utermöhlen, COO, EU and New Markets, RWE Renewables.  “We want to continue to grow in Europe while expanding into North America and Asia.  We will build on our experience and expertise.  We want to use that in the new geographies rather than starting from scratch each time.  The US market fundamentals are very appealing.  We look at the population around the Northeast coast, at the power demand, at the situation with some older electricity-generating plants being decommissioned, and at the wind potential.  We think it’s all there to make it a successful market.  We want to use our experience to help the US realize its potential in offshore wind.” 

“Size matters in offshore wind.  The size of the projects is getting bigger and this will continue.  Bigger turbines mean lower costs.  The opportunities are so big that we’re not afraid of competition.  There will be a lot of opportunities for collaboration.  The projects are so big that it’s better to have smaller stakes in a bigger number of projects,” said Grzegorz Gorski, COO, Offshore Wind, Engie/EDPR Offshore Wind Joint Venture. 

Atlantic Shores Offshore Wind is a joint venture between EDF and Shell.  Shell’s participation in the US offshore wind market has been noted as an example of a traditional leading oil company moving into renewables.  Chris Hart, Managing Director and President, Atlantic Shores Offshore Wind was asked how Shell’s involvement impacted Atlantic Shores. 

“There are five things from our perspective at Atlantic Shores that makes Shell’s investment important to us,” said Mr. Hart. 

  • “Safety leadership: The big players in oil & gas have a long history of safety leadership and that is something they bring to us.
  • Concept of scale: Necessary to allow offshore wind to reach its true potential
  • Technology development: Shell has a long history of technological development
  • Government affairs: adept at establishing relationships and long history of operations
  • Purchasing power: Relationships with stakeholders in the supply chain.”

The second panel, State Procurements for Offshore Wind, consisted of presentations by representatives of the states of Connecticut, New Jersey, New York, Virginia and Massachusetts.  The following is a summary of their comments. 

“Without the Northeast states, there is no offshore wind industry in America to speak of.  Without the states’ support through legislation, which essential de-risks the demand side of these projects, which is the bedrock for these projects,” said the moderator of the panel, Thomas Amis, Chairman and Partner, Amis, Patel and Brewer.

“Offshore wind provides the largest opportunity for us to replace other energy generation sources.  Offshore wind is a new and emerging industry.  How often do you have a chance to get involved in a new and emerging industry?” asked Paul Formica, state senator for the Commonwealth of Connecticut.  “We have two ports that are reasonable to support offshore wind: Bridgeport and New London.  Bridgeport is a little further away but it has property available to develop those types of opportunities.  New London is a small port but has direct access out to the wind farms.  Some years ago, we worked to upgrade the freight line that serves the port and runs north into Vermont and all the way to Montreal.  So it connects the port with areas where real estate is less expansive.  We could put manufacturing facilities in those areas to build up the supply chain.  We didn’t have offshore wind in mind at the time we upgraded that line, but it certainly seems to play out to be a great opportunities to open up a vast area to build facilities and create jobs.  This pandemic is changing the mindset and it may be a little easier to make this occur.”

“We are very excited in New Jersey to be able to announce a new port will be built in South Jersey,” said Kelly Mooij, Director, Division of Clean Energy, New Jersey Board of Public Utilities.  “It will be the first purpose-built offshore wind port in the country.  We’re really excited to start construction next year.  We think it will be a tremendous boon to the economy and a real opportunity for job creation.  We think it’s critical.  We want to drive down the prices of offshore wind farms.  We have an opportunity to really develop the market.  Over 10 years ago, we passed the Offshore Wind Development Act and it took a while to get going after that.  But thanks to Governor Murphy’s leadership, we’ve been able to move forward.  Within his first week in office, he signed executive orders to move forward on offshore wind.  This resulted in a plan to set a goal of 7,500MW of offshore wind capacity by 2035.  The first of five solicitation rounds will be held later this year with the winner announced in 2021.  So we’re moving full-steam ahead.” 

“For New York, our nation-leading 9,000MW offshore wind goal through the Climate Leadership and Community Protection Act was signed into law last summer by Governor Cuomo,” said Doreen Harris, VP, Large Scale Renewables, NYSERDA.  “It’s fundamentally a game-changer for us and the achievement of our clean energy goals.  Delivering that volume of renewable energy into New York’s downstate market is a huge opportunity for us from an electricity system perspective but also from an economic development perspective.  The 9,000MW represent 30% of the New York’s load.  When we think about what this means for us, ‘game-changer’ is the best term we could ever use.” 

“Compared to New York and New England, we do everything completely different in Virginia,” said Jennifer Palestrant, Chief Deputy, Commonwealth of Virginia Department of Mines, Minerals & Energy.  “We have one developer (Dominion) and they announced the largest offshore wind farm in the US to date.  It’s a very different model.  The state is involved in a policy and recruitment standpoint to help bring the supply chain to the United States and to Virginia and to work Dominion and Orsted as well to develop the supply chain and to bring in Virginia, Maryland and North Carolina companies to look at all of these pieces.  We don’t have a bidding process.  We don’t have a local content requirement.  But it gives us a lot of freedom to reach across the borders to help each other.  It’s an exciting process.  I don’t think I’ve ever seen a process that has such bipartisan support in this state.” 

“Some of the challenges that we are looking at include onshore upgrades,” said Joanna Troy, Director of Energy Policy and Planning, Massachusetts Department of Energy Resources.  “The growth of offshore wind is faster than we anticipated five years ago, so what does that mean when there are many, many states all trying to interconnect into the onshore connection points all around the state.  So the New England states did ask our ISO New England for a study on the costs associated with a large amount of offshore wind interconnecting in the state.  It did find that we have some preliminary results and it says right now that it looks about 5.8GW of offshore wind could interconnect without significant upgrades.  But there are a lot of questions that won’t be answered until the final report is available.  But we’re already getting close to that number already when it comes to procurement.  So part of the Massachusetts procurement process is that we require in the RFP that the project must interconnect with ISO New England at any rating that allows full deliverability and that all the upgrades needed to meet that would be included in the price.”