Wind

Massachusetts gives $180m boost to US wind ports in shadow of Commonwealth cost limbo

State is directing over half of backing to coastal industrial facilities being built for beleaguered 1.2GW Avangrid megaproject, with little clarity on next steps should it be shelved

The area surrounding the new Salem Harbour Station gas-fired power plant is being developed into an offshore wind terminal
The area surrounding the new Salem Harbour Station gas-fired power plant is being developed into an offshore wind terminalFoto: massmatt/Flickr
  • Tim Ferry

The US state of Massachusetts will award $180m in funding for new port infrastructure to enable development of 5.6GW of offshore wind plant capacity, despite most of the money heading towards coastal facilities that might soon lack a lead-off tenant.

The funding will go to the winners of the state’s Offshore Wind Industry Ports Investment Challenge launched last June and includes a previously announced $100m.

“Massachusetts’ path to Net Zero in 2050 requires substantial investments in offshore wind, and today we are taking another giant step forward in achieving a clean energy future,” said governor Charlie Baker.

Lieutenant governor Karyn Polito said projects funded through the port challenge “will have a significant impact on the advancement of the sector and will capture high-value supply chain and workforce opportunities”.

Massachusetts has 3.2GW of contracted offshore wind capacity, including the nation’s first utility-scale development, the 800MW Vineyard Wind 1.
Most of the funding – over $100m – will go towards wind port projects being purpose-built for the 1.2GW Commonwealth Wind, which its owner, renewable energy developer Avangrid, has requested be voided by the state.
Avangrid, majority owned by Spanish utility Iberdrola, filed a motion with the state utility regulator Department of Public Utilities (DPU) last week seeking to cancel the project’s power offtake contracts in a last-ditch effort to negotiate better terms amid global inflation and interest rate pressure.

The developer has made the case to the state that the giant project’s original power purchase agreements (PPAs) are unfinanceable given rising development costs and so violate Massachusetts law, necessitating that Commonwealth be voided.

The best path forward “is for the offshore wind energy generation capacity currently included in the PPAs to be procured in the next solicitation”, the company said. “Commonwealth Wind would bid into that solicitation.”

The fate of Commonwealth remains up in the air, as the DPU has not decided whether to accept its request for dismissal.

“If the DPU does not dismiss the proceeding, Commonwealth Wind will need to evaluate at that time its next steps,” an Avangrid representative told Recharge.

The port funding includes $75m for Crowley Maritime to convert a vacant industrial port property in Salem into a purpose-built offshore wind marshaling port, with Commonwealth Wind designated as its first tenant.

Crowley Maritime recently completed its purchase of the 42-acre site and will break ground early next year, with completion expected by 2025.

“The planning for the creation and operation of the terminal has been approached based on a long-term vision, and we believe that tenants will share that lasting commitment for offshore wind energy,” David Decamp, director of corporate communications for Crowley Maritime, told Recharge.
The state has also awarded $25m to Italian cable maker Prysmian Group for the construction of an offshore wind marine high-voltage manufacturing facility and terminal at Brayton Point in Somerset, which is in the frame to manufacture cables for both Iberdrola’s Commonwealth and 804MW Park City Wind as part of the investment package submitted for its winning round three bid last December.
Recharge is awaiting comment from Prysmian at the time of publication.

A further $45m will go towards the Massachusetts Clean Energy Centre’s New Bedford Marine Commerce Terminal, the US’ first purpose-built offshore wind marshalling port which is serving a staging ground for Vineyard Wind 1 and will likewise be the base for some operations for Commonwealth.

Port infrastructure is a looming bottleneck for the burgeoning US offshore wind industry, with as much as 18GW of capacity in the federal permitting queue for construction by 2025. Research by the University of Delaware forecasts a 191-acre laydown shortfall – equivalent to 3.5GW of installation capacity over an 18-month construction season – annually starting next year.
Lack of available port capacity will be an even greater hurdle in California, which recently saw five leases with between 4.6GW and 7.5GW of capacity but has only a single port at Humboldt Bay in its northern reaches available for the sector.
(Copyright)
Published 22 December 2022, 17:09Updated 23 December 2022, 01:15
AmericasUSAvangridIberdrolaCrowley Marine Services