Favorable Offshore Winds Blowing from the Biden Administration
As part of his Executive Order on Tackling the Climate Crisis at Home and Abroad (EO 14008)—issued on the first day he took office—President Biden made significant commitments to renewable energy. These commitments include collaborating with multiple federal agencies in the United States and promoting critical industry support for the acquisition of electric vehicles for the federal fleet, as well as rejoining the Paris Climate Agreement, the landmark international agreement signed in 2015 to limit global warming. The goal is to have net-zero greenhouse gas (“GHG”) emissions by 2050.
Former Secretary of State John Kerry was appointed as the international climate envoy, and former Environmental Protection Agency (“EPA”) Administrator Gina McCarthy was designated as the domestic climate czar. They have their work cut out for them, as the goal of simply meeting the present Paris Climate Agreement goals may not reduce GHG emissions to the required levels.
Offshore wind will be a critical part of reaching the new domestic and international climate goals. President Biden recognizes this fact in the EO by promising to double offshore wind by 2030. This means, according to the new Director of the Bureau of Ocean Energy Management (“BOEM”), “30 GW of offshore wind by 2030”—a catchy and ambitious goal. Developers also recognize the connection by touting reductions in GHG emissions with each project. But playing the numbers game for this goal is too simplistic. For the United States to realistically double the amount of offshore wind, the states, private sector, and federal government must work together to take the necessary steps to meet and exceed this extraordinary commitment.
A first step was taken with the issuance of the final Environmental Impact Statement (“EIS”) for the Vineyard Wind Project, discussed below. (See Vineyard Wind 1 Offshore Wind Energy Project Final EIS.)
The next step was taken by the Cabinet officials of the departments of Interior (“DOI”), Energy (“DOE”), Commerce (“DOC”), and Transportation (“DOT”) on March 29, 2021, when they made the following commitments:
- DOI will establish a new priority wind energy area in the New York Bight between Long Island and New Jersey;
- DOI will issue new lease sales and complete review of at least 16 construction and operation plans (“COPs”) by 2025;
- DOI/BOEM will issue a notice of intent to prepare an EIS for ocean wind off the coast of New Jersey;
- DOT will notice $230 million in funding for port infrastructure, with a focus on offshore wind ports;
- DOE will make available three billion dollars in loan guarantees under the title XVII Innovative Energy Loan Guarantee Program;
- DOC/National Oceanic and Atmospheric Administration (“NOAA”) will enter into a memorandum of understanding (commonly known as an “MOU”) with Ørsted to share physical and biological data in leased areas; and
- $20 million will be made available under the National Offshore Wind Research and Development Consortium funded by DOE and the New York State Energy Research and Development Authority.
These steps are taken with a goal of creating 44, 000 new jobs in the offshore wind industry by 2030. (See Biden Administration Jumpstarts Offshore Wind Energy Projects to Create Jobs.)
This article addresses what role the maritime industry can play in this vital new offshore wind industry.
Vineyard Wind Receives Final BOEM Approval to Proceed with Construction and Operation
The first step that the Biden administration made to double offshore wind was to restart the National Environmental Policy Act (“NEPA”) process for the mega-offshore wind project known as Vineyard Wind, located off the coast of Martha’s Vineyard, MA, and expected to produce 800 MW of offshore wind and provide clean energy to 400,000 homes and businesses once it is operational in 2023. Vineyard Wind has committed to using the Port of New Bedford, MA, as its staging area.
On March 8, 2021, BOEM in the DOI issued the final EIS for Vineyard Wind, endorsing the preferred alternative of an east-west, north-south configuration of no more than 84 wind turbines with one nautical mile spacing between the wind platforms, which is consistent with the Coast Guard’s recommendations. (See Vineyard Wind 1 Offshore Wind Energy Project Final EIS.) Subsequently, BOEM issued the final Record of Decision or granting approval to proceed with construction on May 11, 2021. (See Vineyard Wind.)
This is a critical step because it not only restarts a project that the prior administration delayed for too long, but it will also break the logjam for other pending projects by signaling the Biden administration’s support for offshore wind with approval of the largest offshore wind farm in the United States—a major step towards meeting the president’s “30 by 30” goal. At present, BOEM has approved 10 Site Assessment Plans (“SAPs”) and has 10 COPs under review—with more anticipated. BOEM has committed to approving 16 COPs by 2025.
Another major project pending with BOEM is the Coastal Virginia Offshore Wind (“CVOW”) project developed by Dominion Virginia Energy. This project will include 188 Siemens Gamesa turbines and will supply 2.6 GW of clean energy to 800,000 Virginia homes and businesses when fully operational in 2026. The commercial CVOW project follows on the two-turbine 12 MW research project—also called CVOW—that is the first offshore wind farm to become operational in federal waters in 2020. (Deepwater Wind off Block Island, RI, is the first in state waters.)
Dominion has also established a consortium to build the first Jones Act-compliant turbine installation vessel (“TIV”), called “Charybdis,” currently under construction in the Keppel Yard in Brownsville, TX.
Role of the States and the Public
The states along the Eastern Seaboard have played a critical role in promoting offshore wind. After all, the wind on the outer continental shelf (“OCS”) must come ashore to stateside power stations and integrated with the electric grid. The price of offshore wind is coming down and becoming more competitive with natural gas through a combination of executive orders and state legislation. For example, Governor Gina Raimondo of Rhode Island, now the Secretary of Commerce, set a goal of meeting its electricity demand with 100-percent renewables by 2030. Governor Phil Murphy of New Jersey set a target of 7500 MW of offshore wind by 2035. The Commonwealth of Virginia passed the Clean Economy Act in 2020, which called for zero carbon emissions by 2050 with 5200 MW of offshore wind by 2034. The commercial CVOW project is critical to meeting the Clean Economy Act goals. Absent state and public demand for clean energy, there likely would be little to no offshore wind industry in the United States.
Port Infrastructure, Worker Training, and New Vessels
Many states have invested in new port infrastructure and new training programs for offshore wind workers. For example, Massachusetts was able to persuade three offshore wind developers to use its New Bedford Marine Commerce Terminal for the staging, deployment, and assembly of offshore wind components. (See Massachusetts Offshore Wind Ports & Infrastructure Assessment.) The Virginia Port Authority has leased 40 acres to Ørsted to stage equipment at its Portsmouth Marine Terminal, which will become the southeast offshore chain hub with almost 300 acres available for wind development. (See Port of Virginia Leases 40 Acres to Offshore Wind Company at Portsmouth Terminal.) And Siemens Gamesa could construct a turbine facility at the same port.
From a worker-training perspective, most workers will be expected to receive a Global World Organization certificate in order to work in this challenging new environment. A wind turbine alone can be 260 meters high, as in the case of the new GE Haliade-X 14 MW turbine. (See World’s Most Powerful Offshore Wind Platform: Haliade-X.) Consequently, safety considerations will need to be paramount. States like Maryland and New York have awarded grants for worker training, and Virginia has established the Mid-Atlantic Wind Training Alliance, which is a consortium of colleges and training centers that have created a critical workforce pipeline of highly skilled technicians. The early results of this consortium are very positive. But even with these programs, there is a lack of qualified U.S. mariners to crew all the new vessels. (See Offshore Wind Energy: Planned Projects May Lead to Construction of New Vessels in the U.S., but Industry Has Made Few Decisions amid Uncertainties.)
At the same time, developers are commissioning new offshore vessels, including crew transfer vessels and offshore support vessels. For example, Ørsted entered into a long-term charter arrangement with Edison Chouest Offshore (“ECO”) to build a Jones Act service operations vessel, which will be built in ECO’s yards in FL, MS, and LA, and used in Ørsted’s Revolution Wind, South Fork Wind, and Sunrise Wind projects off the northeast coast. (See Ørsted and Eversource Charter First-Ever Jones Act SOV.) Larger TIVs are on the horizon, as noted in the Dominion “Charybdis” example above.
A recent report from the American Bureau of Shipping found that “demand for wind farm support vessels in the U.S. is expected to increase to support planned construction projects for both fixed and floating offshore wind farms in U.S. waters.” This will be done through a combination of Jones Act and foreign-flag vessels. (See ABS Offshore Wind Report.)
Streamlining the NEPA and Permitting Process
Another element that will be critical to meeting and even exceeding the Biden administration’s goal of doubling offshore wind will be budget and staffing support for the agency that auctions leases on the OCS and approves SAPs and COPs. The former administration tried to streamline the NEPA and permitting process through new regulations and EOs. At the end of the day, it was not successful. The new Biden administration can learn from these attempts and undertake a new process for streamlining the review process without giving short shrift to climate and environmental justice—two of its principal goals.
Role of the Maritime Industry
The maritime industry has a key role to play in this burgeoning offshore wind industry. After all, most of the operations take place in the marine environment. The maritime industry can notably work with major developers and become contractors and subcontractors; encourage developers and shipyards to work together on new and needed crew transfer, supply, and support vessels; advocate for a streamlined title XI loan guarantee program administered by the Maritime Administration (“MARAD”) devoted to OSW vessels; facilitate the implementation of the title VII loan guarantee program at DOE; develop training programs for workers who may be losing jobs in the coal industry and want to transition to the new, clean economy; set up shops and production facilities in the newly designated ports for offshore wind, assisted by the expanded Port Infrastructure Development Program, also administered by MARAD; and apply its relevant expertise and experience from the oil and gas industry. All of this is needed to achieve the Biden administration’s goal for doubling offshore wind and meeting its new commitments under the Paris Climate Accords.
By setting an ambitious goal, the Biden administration, working with the states, private sector, and federal government, can double the amount of offshore wind by 2030—and even exceed it. This presents many new opportunities for the maritime industry, both at sea and onshore in shipyards, ports and maritime training colleges and universities.
Blank Rome’s Of Counsel Joan Bondareff also serves as chair of the Virginia Offshore Wind Development Authority.
This article has been updated since its original April 2021 publication in Maritime Reporter & Engineering News, to reflect new developments.
This article is one in a series of articles written for Blank Rome's MAINBRACE: May 2021 edition.