US Wind pitches massive expansion of Maryland offshore wind projects along with price hike
Developer's rebid would raise its total capacity by 600MW, absorbing most of Orsted’s cancelled Skipjack arrays while propping up an endangered cable maker
US Wind has proposed a massive expansion of its project capacity to Maryland by 600MW to 1.7GW as part of its effort to renegotiate its current offtake contract to meet current economic conditions.
The developers two arrays, MarWin and Momentum Wind, had long stood out as among the few projects awarded prior to 2022's onset of inflation to survive without seeking offtake contract renegotiations.
Orsted's exit from the state puts Maryland's 8.5GW by 2031 mandate at risk.
US Wind's rebid is an “opportunity for Maryland to substantially advance toward its goal of procuring 8.5GW of offshore wind power at pricing that fully satisfies the ratepayer impact tests established by Maryland law,” the developer said in its application to state utility regulator Public Service Commission (PSC).
The rebid proposal would see the developer max out its 80,000-acre (324 sq. km) lease area by installing 114 “advanced technology” turbines rated at least 15MW, raising its total capacity from the current 1.05GW to 1.7GW.
The new project would generate 97% of the total annual offshore renewable energy credits (ORECs) awarded to both US Wind and Orsted in the previous two rounds, around 6.96 million out of 7.16 million.
An OREC is the equivalent of the environmental benefits of 1MWh of offshore wind power.
Price adjustment
US Wind has not revealed its new price and its rebid application redacts that information.
The 270MW MarWin array was awarded its OREC contract in 2017 at a levelised nominal price of $131/MWh, according to figures from industry group American Clean Power Association (ACP), while the 880MW Momentum Wind array received its offtake contract in 2021 at a rate of $71.6/MWh.
The developer confirms that the new price falls under legal thresholds for ratepayer impacts.
The rebid proposes delivering the total capacity in four phases split into two groups, MarWin and its expansion totalling 840MW, and Momentum Wind and its added capacity coming in at 870MW.
The MarWin phases would raise monthly residential rates by $1.44 in 2012 dollars ($1.91 today), below the $1.50 threshold, while the Momentum arrays would impact power bills $0.86 per month in 2018 dollars, ($1.04 today), below the $0.88 cap.
Federal regulator Bureau of Ocean Energy Management issued its record of decision (ROD) for the project, approving up to 2GW of capacity at the lease site 10 miles (16 km) off the coasts of Maryland and Delaware.
Supply chain
US Wind would assume not only the ORECs abandoned by Orsted, but also Danish developer's pledged supply chain investments, including support for an inter-array cable manufacturing plant by Greece’s Hellenic Cables.
Grybowski confirmed that Maryland PSC intends to decide on the application in January next year.
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