Connecticut recently pulled out of a three-state offshore wind energy buy with Massachusetts and Rhode Island. Is a recent focus on the state’s high electricity costs to blame?
WSHU’s Ebong Udoma spoke with CT Mirror’s Jan Ellen Spiegel to discuss her article, “CT opts out — for now — of offshore wind, raising concerns about motives,” as part of the collaborative podcast Long Story Short. You can read her story here.
WSHU: Hello, Jan Ellen. Connecticut, Massachusetts and Rhode Island have been at the forefront of the push to create New England’s biggest and most innovative offshore wind initiatives. So, Jan, why was Connecticut missing when Massachusetts and Rhode Island announced their latest round of projects a couple of weeks ago?
JES: Well, if you want to take Gov. Ned Lamont’s word, the cost was the issue. There are certain arguments to be made about what it would cost at this juncture. He is also very aware, and as said to The Mirror, that he doesn’t want to add to the burden on people’s electric bills. You can posit why he doesn’t want to add to that burden at this particular time, a couple of months before an election. But the cost is not inconsiderable, and you also have to remember that these are long-term contracts or whatever cost, whatever the prices that the state gets in, they’re going to be stuck with for a while.
You could also make the argument, well, look, we think the Federal Reserve is about to lower interest rates, which might help on that score. That said, this was structured to be a three-state initiative so you could get economies of scale. If you had large projects, they could get bids a little bit lower. Will Connecticut come in at a later point? Maybe. Will it make life problematic for the other states between now and whenever they get in? Maybe. On the other hand, these projects take a while, and say, Connecticut clocked in towards the end of the year, it probably wouldn’t slow anything down considerably.
WSHU: Okay, so, for political contingency, with an election a couple of months away, it might be better to put it off and deal with it after. But Massachusetts and Rhode Island went ahead. If Connecticut stays out, it will raise the cost for Massachusetts and Rhode Island. Would it not? Basically, what’s going to happen is that if they don’t have customers for the power they’re producing, the project is no longer viable. Isn’t that what the situation is right now? That’s why they need all three states to commit to buying the energy they produce.
JES: It depends on the project you’re talking about. There are a number of projects that are involved in this latest solicitation, and some of them are completely taken by Massachusetts and Rhode Island. One of them, however, is not. It’s a project that’s now called Vineyard Wind 2. It’s a 1200-megawatt project; Massachusetts has opted for 800 megawatts of that, which leaves 400 megawatts left. Will that project still be viable if no one decides to purchase those 400? Well, the developer, a company called Vineyard Offshore, says they can’t do it without everybody involved.
Well, there’s a certain amount of pressure on Connecticut to get with the program and pick up those other 400 there. You know, Massachusetts could decide to pick it up, but it’s a little less likely that Rhode Island will; it’s a much smaller state, and it already has quite a bit of offshore wind. That said, could Connecticut wait a few months and do it? Yeah, it’s entirely possible, but everybody’s a little nervous at this point. And the whole, as you said, the whole point of doing this was to make it more cost-effective, and by Connecticut sitting out, especially on that one project, it could cause a problem. There are also a couple of other projects hanging out there that have, at this point, no takers.
WSHU: Wow, but at the New England governor’s meeting in Boston, Massachusetts, Gov. Maura Healey said that all the states are still involved. Connecticut is still involved. Do you have any idea what that meant by that? In talking to the governor himself, he seems to feel that he can deal with this later, but he doesn’t seem to be committed.
JES: Well, look at it from this standpoint: the whole idea of doing this three-state solicitation, I’m not going to say whose great idea it was, but it may well have been Connecticut’s. The Department of Energy and Environmental Protection Commissioner Katie Dykes has long, has for years now, even before she was actually the commissioner and was just handling the energy component of DEEP, she’s been out in the forefront for a long time, looking to do multi-state solicitations and operations of all sorts. So you have to think that she was behind putting this whole thing together in the first place.
It’s hard to know where things are. I think you need to take that meeting in Boston there with a bit of a grain of salt. That was, that was the 45th annual meeting of this kind of thing, and not much typically comes out of them. It also involves Canada and whatnot. You got ta look at it, also from a legislative standpoint, where some of these guys running for office have really made keeping electricity rates low a big part of what their campaign pushes. We have had, I don’t want to say daily, but you know, many press releases every week from especially Republicans, who are making this a big, it would seem election issue. Democrats are also on board with keeping electric rates low. How do you do that? At this point, people view offshore wind as an expense and a cost. What you don’t often see a lot of politicians doing is looking at from the standpoint of an investment and what kinds of avoided costs are there. Yes, there’s an initial build-out that costs money, but ultimately, wind power is free. It’s renewable. You’re not stuck in the international market of energy costs that are affected by everything all around the world.
WSHU: However, in the United States, there’s another wrench that could be thrown into the works, and that is if Donald Trump wins in November, because Trump has famously hated offshore wind, and so that’s another wrinkle that has been considered if a decision is made right now.
JES: That is a very big wrinkle. And I think we also have the experience of the four years Donald Trump was in office, where all this permitting that had to come through for offshore wind was absolutely slow-walked. I mean, very, very little movement was made, and he has made absolutely no he has said that he would stop it again.