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DOE Pulls Backing for Oregon Offshore Wind Project

There was a lot of fanfare in February 2014 when the Obama administration announced Principle Power could submit a plan to build a 30-megawatt offshore wind farm in deep Pacific Ocean waters off the coast at Coos Bay, Oregon. U.S. Secretary of the Interior Sally Jewell came to Portland to publicize the decision, and joined then-Gov. John Kitzhaber in front of a gaggle of media. “Floating Wind Turbines Coming to Oregon Coast,” ClimateWire reported a day later. (Others were less exuberant.)

No such ceremony this past week, as the project’s demise was made official in a U.S. Department of Energy update to its Advanced Technology Demonstrations Program for Wind.

Media in Virginia first reported the feds’ decision after Dominion Virginia Power put out a press release that the DOE was jettisoning support for an offshore wind project that the company was planning to do off the coast at Virginia Beach.

That project and the Oregon one (plus a third off New Jersey, called Fishermen’s Energy) had been funded to the tune of $10.7 million apiece, with about $40 million more due once they convinced the DOE they were actually on course to be built.

Neither was. Dominion seemed weirdly lukewarm on its own VOWTAP project right from the start, and turned icy after cost estimates came in on the high side. In Oregon, Principle Power was unable to get an above-market power purchase agreement for Windfloat Pacific from the state’s two major investor-owned utilities, Portland General Electric and Pacific Power, and there was no political appetite to force it. Gov. Kate Brown, who replaced the scandal-ruined Kitzhaber as governor in early 2015, appeared unwilling to spend any political capital to make it happen (she was busy backing a clean fuels bills in 2015, and 2016’s legislative session was dominated by the Clean Electricity and Coal Transition bill). She did set up a “WindFloat Pacific Offshore Wind Advisory Committee” last summer, but critics said the composition of the committee made it unlikely it would find a solution. And it didn’t.

In its funding update, the DOE didn’t say they’d pulled the plug on Dominion and Principle Power, but instead said an evaluation had led them to select two alternate projects:

In May 2016, the Energy Department evaluated the full portfolio against established milestones to determine whether any of the three demonstration projects—Dominion, Fishermen’s Energy, or Principle Power—should continue as part of the Offshore Wind Advanced Technology Demonstration program, and whether either or both of the alternates—the University of Maine or LEEDCo—should be onboarded into the Demonstration program.

Through this evaluation, the Department decided that the Atlantic City Windfarm developed by Fishermen’s Energy, Lake Erie Energy Development Corporation’s (LEEDCo’s) Icebreaker project, and the University of Maine’s New England Aqua Ventus I project have demonstrated significant progress toward being successfully completed and producing power.

None of this is too surprising. Last June, I wrote a piece for Breaking Energy about the original three projects’ struggles. Check it out for more background, but the basic point was that the DOE’s funding for advanced offshore wind simply wasn’t enough to make such projects happen. Will the two newly tapped projects and the still-standing Jersey project now be able to find the strong state and/or utility support they will need?

The Jersey project looks stuck as long as Chris Christie is governor; earlier this month he vetoed another bill that would have paved the way for a power purchase agreement. Prospects for the Maine project appear better—regulators long ago approved a term sheet to sell the power from the University of Maine-run project at 23 cents per kilowatt-hour. Of course, a planned Statoil project in the state had a similar term sheet, but it ultimately fell through under pressure from Gov. Paul LePage.

Finally, in Ohio, the developer says it “has a Memorandum of Understanding with Cleveland Public Power for 25% of the power” and agreements with two counties to buy 10 percent apiece. That doesn’t sound totally solid, but is better than nothing. What of the remaining power? The plan is that it “will be purchased by a retail electricity supplier who will create an Icebreaker power option for residential and commercial customers.” It all sounds reasonable, but far from certain.

One thought on “DOE Pulls Backing for Oregon Offshore Wind Project

  1. Make no mistake: we are in the midst of a worldwide energy revolution, as humanity moves from thermal sources of electricity to renewables. If you don’t see it, you’re not paying attention. This massive change faces many obstacles from entrenched economic interests, from ideologues, and from plain ol’ crusty curmudgeons. But the pull of necessity and technology is great, and the change will occur. It’s too bad Oregon chose not to support this new floating wind project. It could have been the foundation for a new west coast industry, providing new jobs and clean energy. I suspect California or Hawaii will enjoy the benefits of our reticence.

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