America’s offshore wind evangelist isn’t sure he’d do it all again.
Jim Gordon spent millions trying to build Cape Wind, the doomed offshore wind project he proposed building off Massachusetts in 2001. But he was in a buoyant mood Wednesday. Vineyard Wind, a project capable of generating almost twice the amount of power Gordon had once envisioned, announced that the first of its 62 turbines had delivered power to New England’s grid.
“I feel good about today,” he said in a telephone interview. “It’s an important date because offshore wind is going to be a major component of our energy future. It is unfortunate that it took so long to happen.”
Gordon isn’t involved in Vineyard Wind. He’s moved on to developing solar and energy storage facilities. Yet the news that the wind project south of Martha’s Vineyard is generating power provided him a lift, validating his thesis that the Northeast should look to the ocean for a more sustainable supply of electricity.
If Vineyard Wind’s announcement represents proof of Gordon’s original idea, however, it also underscores the risks facing states relying on offshore wind to power their climate agendas. States stretching from Massachusetts to North Carolina have set goals for buying offshore wind, with the intention of greening their power supply. President Joe Biden wants to build enough offshore wind to power 10 million homes by the end of the decade.
The only problem: The world needs to immediately cut emissions to stave off rising global temperatures and the development of a major offshore wind farm can eat up most of a decade. And that’s if things go well.
Vineyard Wind originally won a power contract from Massachusetts in 2018. It was nearly derailed by a permitting delay during the Trump administration and did not receive the federal go-ahead to begin construction until Biden took office in 2021.
The project was then buffeted by inflationary pressures driven by rising interest rates and an immature supply chain, surviving largely because its developers, Avangrid and Copenhagen Infrastructure Partners, locked in contracts to build the project before prices began to rise.
“This truly is a milestone for offshore wind and the entire renewable industry in North America,” said Tim Evans, partner and head of North America at Copenhagen Infrastructure Partners. “By delivering first power, we have broken new ground and shown a viable path forward with power that is renewable, locally produced, and affordable.”
Avangrid CEO Pedro Azagra called it a “watershed moment for climate action in the U.S. and the dawn for the American offshore wind industry.”
But some other projects have yet to see the light.
A few hours after the Vineyard Wind announcement, another group of developers said they were canceling their power contract for a project serving New York state. Equinor and BP said rising costs meant their Empire Wind 2 project, a 1,260-megawatt development, was no longer economically viable under the terms of its power deal.
Analysts said the move paves the way for the pair to try and secure higher prices when New York solicits proposals for new projects later this year. An Equinor official stressed that the company remains committed to developing Empire Wind 2.
But the announcement illustrates the growing pains that continue to plague offshore wind. Empire Wind 2 is the seventh project to cancel its power contract within the last 12 months. Two of those projects, Ocean Wind I and II in New Jersey, have been canceled altogether.
Higher financing costs, difficulty securing specialized ships needed to install turbines at sea, and lengthy permitting timelines are among the reasons that consultancies like BloombergNEF have downgraded their outlook for offshore wind. As recently as last July, BNEF expected 23,100 MW of offshore wind to come online by 2030. It now thinks the U.S. is on track for 14,500 MW by that year.
“If you look at it, almost every project in the U.S., at least the last 2-3 years, was impacted by cost pressures. Even Vineyard Wind was impacted, it just was not as pronounced,” said Atin Jain, a BNEF analyst who tracks the industry.
The lesson of Vineyard Wind, he said, is “don’t underestimate things surprising you and taking you off guard. Proper contingency planning is the crux of it.”
Jain thinks the U.S. offshore wind industry is now headed for a reset, with developers seeking new contracts that pay higher electricity prices to their projects. The extent of the industry’s rebound will depend in large part on states’ willingness to swallow higher prices for offshore wind.
An early indication arrived last fall, when New York announced three new contracts that pay more for offshore wind power than previous deals awarded by the state.
Connecticut, Massachusetts and Rhode Island are moving forward with a plan to jointly buy more offshore wind. The three New England states hope that in partnering together, they will be able to achieve greater economies of scale and attract cheaper prices.
The states are accepting bids through the end of the month and hope to make a decision by summer, said Elizabeth Mahony, the Massachusetts Department of Energy Resources commissioner.
“We believe strongly in the power of offshore wind and this industry and its ability to deliver clean power to our region in a way that actually lifts up the economy of our region,” she said in an interview.
Paving the way
Current and former Massachusetts officials said they hoped Vineyard Wind’s announcement would help erase the bad memories associated with Cape Wind and supercharge the Bay State’s climate work.
Gina McCarthy, a former Massachusetts environmental official who went on to champion offshore wind as Biden’s first climate adviser, recalled hearing Gordon’s pitch in the early 2000s and wondering if people on Cape Cod would get behind the idea.
She expressed confidence Vineyard Wind would make it easier for the next round of projects to get built. People are inherently skeptical of new technologies, she said, but warm to them once the benefits are proven out.
“I think it’s just a story of how it takes time for new technologies to grow and become acceptable,” McCarthy said. “But you cannot give up. That’s the big lesson here.”
Vineyard Wind is not the first offshore wind project to be built in the United States. That distinction belongs to the Block Island Wind Farm, a five-turbine, 30-MW pilot project off Rhode Island. It isn’t even the first utility-scale project to start generating power in the last month. South Fork Wind, a 12-turbine project, began sending electricity to the grid in December; when complete, it will generate 130 MW of electricity for consumers on Long Island.
But no other project better represents the scope and ambition of what offshore wind means to Northeastern states’ climate ambitions. At 800 MW, Vineyard Wind will be more than twice the size of the next largest wind or solar development on the East Coast, a 321-MW onshore wind farm in New York, and the third-largest renewable project in the country.
That injection of power is especially important in New England, which is united by a single six-state electric grid. In recent years, the region has struggled with renewable development and concerns over the reliability of its limited natural gas pipeline network.
Wind and solar account for 7 percent of the power on New England’s grid, compared to 14 percent nationally. State and federal regulators have also spent years trying to avoid a scenario where surging demand for gas during a winter cold snap leads to fuel shortages and power blackouts. Gas generates about half of New England’s electricity, but the region’s pipeline network has to serve both residential heating demand and power plants.
Vineyard Wind will help solve both challenges. It will deliver large amounts of clean power — especially in the winter, when winds over the Atlantic Ocean blow strongest.
“We’ve had a good time today celebrating this win, even as we’re working on the next step. It’s very satisfying,” Mahony said. “To know that it’s actually delivering power, to know that it’s coming at a really great price and in the winter, when we often have struggled with pricing and reliability questions, is fairly significant for the power sector and our climate goals.”
Such statements represent a sea change from the days when Gordon was trying to sell Massachusetts officials on offshore wind. Gordon spent 16 years embroiled in political wrangling and litigation in attempts to build Cape Wind. He finally called it quits in 2017.
He recalled that one time former Massachusetts Gov. Mitt Romney, a Republican, drove to a public meeting on Cape Cod to declare that his wife objected to the sight of the turbines on the horizon. Business interests on the Cape echoed the concerns, imagining a scenario where tourists opened the shades of their hotel rooms to be greeted by the sight of turbines on the water. Other energy companies simply didn’t want to see a new industry take shape, he said.
Even so, Cape Wind ultimately helped paved the way for projects like Vineyard Wind. Some Cape Wind alum work on Vineyard Wind. It also helped shape the United States’ regulatory process for permitting wind projects. When Gordon first proposed building in Nantucket Sound, there weren’t any federal regulations for permitting a wind farm at sea.
Vineyard Wind became the first project to successfully navigate the Bureau of Ocean Energy Management’s permitting process. The bureau has said it hopes to complete 16 offshore wind permits by the end of Biden’s current term.
“The consolation prize that I feel in my heart is that although Cape Wind didn’t make it across the finish line, we called attention to this inexhaustible resource we can tap for a more sustainable energy future,” Gordon said.
People often ask Gordon if he would do it again, knowing how it all turned out.
The answer “probably depends on the day,” he said, before adding, “It’s a good day, and I’m happy to see this day finally happen.”
This story also appears in Energywire.
