Offshore wind developer: ‘We plan to be here a long time’
Orsted touts proposal, plans for New London
New London — When Orsted built the world's first offshore wind farm in 1991, the turbines generated less than half a megawatt of electricity and stood 115 feet tall with a 115-foot rotor diameter.
In the Orsted-Eversource joint proposal to deliver the state about 800 megawatts from an offshore wind farm in federal waters south of Martha's Vineyard, roughly 100 8-megawatt turbines could tower more than 600 feet above the water — double the height of the Statue of Liberty — with a 538-foot rotor diameter. If the state selects the proposal in its zero-carbon electricity auction, Orsted might consider an even larger, 10-megawatt turbine still in development.
“For one increment the rotor diameter expands, it expands the energy production three times,” Ryan Chaytors, an Orsted project development manager, told a packed Holiday Inn conference room during a Chamber of Commerce of Eastern Connecticut breakfast on Wednesday. “You're able to extract more energy out of the wind with a larger machine, which allows you to provide a lower-cost product to the market.”
The shift in technology and scale has helped drive down offshore wind production costs more than 60 percent over the past six years in Europe, Chaytors said. In the U.S., increased scale and ramped-up competition have driven costs down, as well. And Chaytors argued that with no fuel costs compared to gas or oil or other fossil fuels, offshore wind faces no price fluctuation, saving ratepayers over the long term.
In Massachusetts, Vineyard Wind's 800-megawatt offshore project will deliver power at a fixed rate of 6.5 cents per kilowatt hour, almost three
times cheaper than the defunct Cape Wind project from more than a decade ago. Orsted’s and Eversource’s proposed electricity rate remains undisclosed to the public while state regulators consider the proposal.
The Block Island Wind Farm delivered power at more than 24 cents per kilowatt hour in its first year of operation, with a 3.5 percent annual escalator built into the contract. Officials at Deepwater Wind — which recently was acquired by Orsted — said their winning proposal to deliver 200 megawatts of electricity to Connecticut from a wind farm south of Martha’s Vineyard would see dramatically lower, fixed rates in contracts still being hammered out with Eversource and National Grid. That project should be operational by 2023.
The Orsted-Eversource project, called Constitution Wind, also will be operational by 2023 if picked among the 100-plus submissions in the state’s zero-carbon electricity auction. The wind farm would inject power into the New England grid through a submerged export cable connecting at Brayton Point in Somerville, Mass., the site of a former coal-fired power plant.
“It’s very exciting. It’s a whole new frontier,” said Dennis Galvam, outreach planning for strategic projects manager at Eversource. “It’s something that’s been tried and has worked but we need to do it here.”
Orsted says the project could power more than 600,000 homes and create 1,400 direct and indirect jobs. Orsted pledged a $25 million fund to spur growth in the local economy and to support skills training and environmental stewardship programs. Orsted also confirmed it would maintain Deepwater Wind’s $15 million commitment to upgrade New London State Pier.
The Department of Energy and Environmental Protection expects to pick winning proposals by the end of the year.
Questions from the crowd, which included politicians, labor representatives, environmental advocates, business leaders, educators and energy consultants, focused on costs, environmental impacts and potential economic growth.
Focusing on job creation, John Humphries of the Connecticut Roundtable on Climate and Jobs said he is hopeful Orsted considers gravity-based foundations that could be constructed in Connecticut, as opposed to monopiles built in Europe or steel jackets made in the southern states along the Gulf of Mexico. Chaytors said that, based on the size of the project, monopiles or jackets were the only foundations under consideration.
Big bet on New London
On top of competing with other low- and zero-carbon energy producers in the state auction, Orsted is making a big bet on New London as a longterm investment and economic development opportunity.
The company has teamed up with Gateway Terminal, which is vying to run State Pier — a facility Orsted says could become a hub for upcoming offshore wind projects along the East Coast over at least the next decade.
“We are looking at New London State Pier as being a world-class installation harbor for offshore wind projects coming down the pike,” Chaytors said. “We plan to be here a long time. There’s an opportunity for continual developments. We’re not talking about a two- or three-year period. This could be 15 to 20 years.”
Even if the Constitution Wind project is not selected in the zero-carbon auction, Chaytors said the demand for offshore wind is so great that New London — with no overhead restrictions, skilled and unskilled laborers, situated near a host of upcoming projects — remains a big draw.
“There’s roughly 10 gigawatts of capacity” being procured by Massachusetts, New York, New Jersey, Connecticut and Rhode Island, he said. “This facility could support the buildout of them all. We’ve seen this happen in other markets. As the demand builds out, you see supply chain and manufacturers will start to get attracted to this location and actually build their facilities close, as opposed to places in Europe or South America.”
Chaytors noted that if the Connecticut Port Authority picks Gateway Terminal to run the port, Orsted will lease space and help transform it into an attractive hub for the supply chain and manufacturers. Existing port operations would not cease and could eventually expand, he said.
“We’re not commandeering the port,” he said. “We’re not looking to close down the harbor to anybody but offshore wind. That’s not the way it works and not the way we want it.”
Chaytors noted that when it comes to the environment, the wind farm’s permitting process requires extensive surveys of avian migration patterns, seafloor species and habitats, and protections for the North Atlantic right whale and other marine life.
He also said that Orsted adjusted the entire layout of its lease area off Martha’s Vineyard specifically to accommodate the east-west fishing patterns of fishermen in Connecticut, Rhode Island, New York and Massachusetts. The turbines initially were laid out to optimize energy production, but Orsted redesigned the layout to create about 1 nautical mile of space between turbine rows, allowing fishermen “to just continue transiting and fishing through the lease area,” Chaytors said.
“We’ve heard a lot of positive feedback,” he added. “We think that is a major, major concession but allows us to show we’re not just saying, ‘Give us feedback,’ and then we push it aside. We will take it into account and, if possible, we will act on it.”