When the Maryland Public Service Commission awarded two offshore wind energy companies leases for the construction of turbines off the coast of Ocean City in 2017, it came as a surprise – even for the energy developers themselves.
So it shouldn’t have been a surprise when the PSC gave the same two companies leases for the second phase of offshore wind development on Friday instead of pulling one over the other.
Maryland’s offshore wind portfolio is set to grow significantly following PSC’s decision to lend offshore renewable wind energy to the two developers who have jointly proposed more than 1,600 megawatts of new energy for construction off the Maryland coast.
“The commitments announced today reposition Maryland as a leading offshore wind company and cement the state’s status as a major manufacturing hub for the US offshore wind industry,” said Liz Burdock, president and CEO of the Business Network for Offshore Wind on Friday.
The PSC decision enables US Wind, Inc. and Skipjack Offshore Energy, LLC to continue their expansion plans in federal waters off Ocean City. US Wind is allowed to build 808.5 megawatts of new energy, while Skipjack was awarded 846 megawatts. The proposed new projects complement the 368 megawatts of offshore wind power that both companies are already developing off the coast of Maryland.
The PSC decision begins to meet the requirements of the Clean Energy Jobs Act of 2019, which raised Maryland’s Renewable Energy Portfolio Standard targets to 50% by 2030 and expanded offshore wind capacity to a minimum of 1,200 megawatts. The law includes an obligation for Maryland electricity providers to source 2.5% of their supply from offshore wind energy.
Even so, it could be years before the 800-foot wind turbines appear in the Atlantic off the coast of Ocean City.
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Still, state officials praised the economic benefits of the new projects – they estimated they would generate nearly $ 1 billion in additional government spending and create more than 10,000 jobs in Maryland – as well as the impact they will have on the state’s ability to combat would climate change.
“The effects of climate change are real and, with its 3,000-mile tidal coastline, Marylanders are particularly at risk,” PSC chairman Jason M. Stanek said in a statement. “So it is important for the Commission to take this action that will lead our state on a path of deeper decarbonization and help Maryland meet its aggressive clean energy goals – the people of our state and our region deserve nothing less.”
Environmental groups welcomed the news.
“These projects will use the ocean wind to generate a significant amount of zero-emission electricity to power homes and businesses,” said the Maryland League of Conservation Voters, Sierra Club Maryland and the Chesapeake Climate Action Network in a joint statement . “These types of projects are vital to our efforts to reduce greenhouse gas emissions and to do our part as a state in combating climate change.”
US Wind and Skipjack were the only bidders for the second phase of the offshore lease, but each made more than one bid. The proposals were judged on a number of criteria, PSC officials said, including the impact on customer utility bills, Maryland’s health, environmental and climate interests – including reductions in greenhouse gas emissions – and the benefits of economic development for the state.
After consulting with advisors, the commission found that the second-round projects could be built without a large increase in the electricity bills of the tariff payers.
PSC approval requires companies to use port facilities in the Tradepoint Atlantic business park in Baltimore County and in the Ocean City area for operations and maintenance activities. US Wind must hold on to its commitment to develop a monopile construction facility at Sparrows Point, while Skipjack must fulfill its plan to build submarine cable and turbine tower facilities in Maryland and invest in modernizations at an east coast steel components company.
Skipjack plans to set up its turbines about 20 miles off the coast of Maryland; US Wind says its next turbines will be 15 miles offshore. Ocean City officials continued to urge the PSC that all turbines be located at least 30 miles from shore, but the commission declined to do so because the projects are in federal waters. However, the commission said it required both developers to make the best commercially reasonable efforts to minimize the day and night impact of the projects.
Even with the latest PSC decision, there are further hurdles that the country’s wind energy industry has to overcome. The first and second phases of the wind energy projects are still awaiting approval from the US Department of the Interior’s Bureau of Ocean Energy Management. The Biden government, which is promoting renewable energy development on various fronts, has promised to expedite the approval process. Turbines are unlikely to appear off the Maryland coast until at least 2025.