GOV. MAURA HEALEY decided to go big as part of a three-state offshore wind procurement, while Rhode Island went small and Connecticut bought nothing at all.
At a State House press conference on Friday, Healey said her administration will seek deals with three offshore wind developers for a total of 2,678 megawatts of electricity, enough to provide a fifth of the state’s electricity. Rhode Island is piggybacking on the Massachusetts deal by agreeing to purchase 200 megawatts from one of the three developers.
Connecticut, where soaring electricity prices have triggered what some are calling rate rage, did not take part in what was billed as a three-state offshore wind procurement. A spokesman for Connecticut Gov. Ned Lamont didn’t return phone calls, and Healey surprisingly indicated she didn’t know what Connecticut was doing.
“I don’t know if they’ll do anything today or not, but my hope is they buy in at some point,” Healey said of Connecticut. She said she was glad Rhode Island participated and excited about what Massachusetts is doing.
“We’re going big,” she said at the start of the press conference, answering a question that has hovered over the procurement process for months – whether Massachusetts should purchase a lot of offshore wind power now, at a time of great economic uncertainty in the industry, or whether it should go small and wait for the financial dust to settle.
Attorney General Andrea Campbell had argued early on in the procurement process that the state should go small, but Healey announced yesterday that she was doing the opposite.
“The bottom line is, Massachusetts, we need more power. We need to generate more power to be able to do what we need to do,” Healey said.
Rebecca Tepper, Healey’s secretary of energy and environmental affairs, said this is no time to go small. “Offshore wind is our future and it’s vital we build that future today,” she said. “By going big now with projects, we’re going to lead the nation in the global race for developers, vessels, materials, and expertise.”
State officials said the deals will help get an offshore wind staging terminal built in Salem and keep that port and the existing staging terminal in New Bedford busy through 2032.
Tepper also said environmental concerns demand going big. “Climate change is here. It isn’t waiting for us,” she said.
Healey said clean energy will bring jobs, a stronger economy, and lower electricity costs. “The world will look to New England for the future of clean energy,” the governor said. “These projects will help create a stronger economy, massive economic development, and, importantly, lower electricity costs for our residents and our businesses.”
The deals Healey announced on Friday didn’t come with price tags. The developers in their bids included prices, but the governor said the companies that were selected will now sit down with the state’s utilities and negotiate the final terms. Once those negotiations are completed, the contract terms will be filed with the Department of Public Utilities for its approval.
Although Healey said the deals will lower electricity prices for consumers, the actual price of the power is expected to be a lot higher than previous deals the state has struck with offshore wind developers. The deals announced Friday are essentially redos of earlier contracts two of the developers previously signed with the state; the developers subsequently terminated those agreements, paying millions of dollars in penalties, when rising interest rates, inflation, and supply chain disruptions made the earlier contracts uneconomical. Many expect the price of power under the new deals announced Friday to be twice as high as it was with the earlier contracts.
The negotiations over final pricing may be tricky, particularly with one of the projects.
The Healey administration agreed to purchase 791 megawatts from Avangrid, which intends to build a wind farm called New England Wind 1 adjacent to the Vineyard Wind 1 wind farm going up at sea now. The Avangrid project is expected to begin construction next year and be operational in 2029. The project will be staged from the port in Salem.
The administration agreed to purchase 1,087 megawatts from Ocean Winds, which intends to build a wind farm called SouthCoast Wind in the same area. The developer hopes to begin construction next year and finish in 2030. Rhode Island agreed to purchase 200 megawatts from the SouthCoast project. The SouthCoast project is expected to be staged in New Bedford.
The Avangrid and Ocean Winds projects are essentially the same ones the developers had to terminate before when economic conditions changed and the companies concluded the original terms of the deals were no longer viable.
The Healey administration also agreed to purchase 800 megawatts from Vineyard Offshore, which intends to build a wind farm called Vineyard Wind 2. Vineyard Offshore’s original bid was for 1,200 megawatts, which means its pricing was based on a wind farm of that size. The project plans to use Salem as its staging port.
Several sources speculated that Connecticut was supposed to purchase the other 400 megawatts of Vineyard Wind 2 but then got cold feet. A breakdown of the deals in a press release included an asterisk suggesting “other entities” may join the Avangrid and Vineyard Offshore deals. The press release also said an offshore wind staging port in New London, Connecticut, and one in Providence would benefit from the deals.
The issue could come to a head next week when New England governors and Canadian premiers sit down to discuss energy and transmission issues. Barring some breakthrough with Connecticut, it would appear Vineyard Offshore would have to revise its deal substantially as it enters pricing talks with the Massachusetts utilities. Officials at Vineyard Offshore did not return phone calls.
Healey seemed to shrug off Connecticut’s non-participation. “I know it’s a good deal for Massachusetts, and that’s why we’re doing it,” she said. “This is the right bet for Massachusetts. What’s important is we’re in the game and we’re leading and we’re playing on a number of fronts.”
As the governor pointed out, the state is counting on offshore wind to make the state energy independent and to reduce greenhouse gas emissions as required by law. “We’ve got to do this,” she said.
She never mentioned the problems Vineyard Wind 1 is having in getting back on track after a turbine blade designed by GE Vernova broke in half in mid-July, dumping styrofoam and fiberglass into the ocean, which washed up on beaches in the area.
She didn’t mention the possibility of Donald Trump winning the presidency. Trump has vowed to shut down the offshore wind industry if he gets elected.
And the governor shrugged off opposition from those concerned about offshore wind turbines covering a large swath of the ocean off the coast.
“There’s been some opposition, you’ve reported that through the years, as with any new industry or venture, but I have to say I think this polls overwhelmingly very strong in Massachusetts,” she said. “We’ve determined, and it’s not just the state, we’ve determined that this is a cost effective, one of the most affordable ways, for us to bring that power online here in Massachusetts.”
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