Maryland’s offshore wind opportunity has not been in recent news. Activities in other states, such as Massachusetts, Rhode Island and New York, overshadowed the procedural advancement of the Maryland Offshore Wind Renewable Energy Credit (OREC), an up-to $1.9 billion financing mechanism to be awarded by the Public Service Commission.
US Wind and Skipjack Energy LLC, a subsidiary of Deepwater Wind, are the two developers competing to be awarded the OREC financing. Both have submitted viable projects, and they are currently under review.
US Wind is planning to install 187 total turbines in 20 meters to 30 meters of water over approximately 80,000 acres. A substation will collect the energy from the turbines and transmit the electricity to the shore using underwater cables. The nameplate’s 750 MW of power will meet 100% of Maryland’s offshore wind renewable energy goals, and it is anticipated to come online in early 2020.
For its part, Deepwater Wind says its 120 MW Skipjack Wind Farm will spin off of Maryland’s eastern shore using America’s most innovative wind turbines. The project will help the state meet its clean energy and emission-reduction goals in an affordable way, and it’s the right size for Maryland as it enters America’s growing offshore wind industry.
A decision to award the OREC will be made May 17.
The buildup of the OREC award throughout this spring is newsworthy, as it will demonstrate the first successful publicly supported finance mechanism for offshore wind in the U.S. To date, there have been two power contracts awarded for the sale of U.S. offshore wind generation. Deepwater Wind owns both of them under long-term power purchase agreements with a utility off-taker.
On Jan. 9, US Wind organized the third meeting within its offshore wind information series in Salisbury, Md. Following opening remarks, the Business Network for Offshore Wind was invited to report on the state of the industry and provided the following points:
The U.S. offshore wind market is here to stay and grow. There are very few new offshore wind lease areas in Europe, and the developers, along with the supply-chain businesses, are seeking new markets. Asia and the U.S. are strong contenders; however, the U.S. market provides new opportunities at a scale that will help drive down costs globally.[adleft zone=’190′]
Maryland can expect significant job impacts from offshore wind. The highest-profile job opportunities arise from the domestic production of the primary components, such as foundations, transition pieces, blades and cables. The production of the large and heavy primary components requires a port, such as Baltimore, with good deepwater access. By meeting with secondary and tertiary supply-chain businesses in Europe, the Network recently learned the importance of understanding the dynamic and necessities of the industry. Secondary and tertiary suppliers that are involved in providing products such as scaffolding, coatings, ladders, fastenings, hydraulics, concrete and electrical components – companies that are to be found on the eastern shore in Maryland – could be called upon at any time during installation, as well as over the 25-year operations and maintenance lifetime of the project. Intracompany relationships and trust are vital in the formation of the offshore wind supply chains.
Case studies of European businesses entering the offshore wind supply chain often have an underlying story line of the companies being called into the industry because of a pressing need or a recommendation made by an established supply-chain member. Intracompany relationships and trust are essential. Interfacing with developers, original equipment manufacturers and other supply-chain members to feature and remind colleagues of businesses’ capabilities remains key to becoming part of the emerging U.S. supply chain. Equally important is the need to stay engaged in understanding the changes in the offshore wind industry as it seeks to become more efficient, with lower costs. The changes bring opportunities that are opening for new players.
Ross Tyler is strategy and development advisor for the Business Network for Offshore Wind. He can be reached at firstname.lastname@example.org.