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Federal delay casts doubt on first big US offshore wind farm

Christopher Martin and Jennifer A. Dlouhy, Bloomberg News on

Published in Business News

The Trump administration cast the fate of the nation's first major offshore wind farm into doubt by extending an environmental review for the $2.8 billion Vineyard Wind project off Massachusetts.

The Interior Department has ordered an additional study of the farm, proposed by Avangrid Inc. and Copenhagen Infrastructure Partners, Interior Secretary David Bernhardt said in an interview with Bloomberg News Friday. The project, which has drawn opposition from fishermen and coastal communities, had been scheduled to be operational by early 2022. The developers have warned delays could put it in jeopardy.

Bernhardt said it's crucial the impacts be thoroughly studied. "For offshore wind to thrive on the outer continental shelf, the federal government has to dot their I's and cross their T's," he said.

The project south of Martha's Vineyard is crucial to the future of offshore wind in the U.S. It's the first of several massive wind farms planned off the East Coast. Massachusetts, New York, Maine and New Jersey are all counting on turbines at sea to achieve aggressive clean energy targets. Their efforts are expected to spur an estimated $70 billion offshore wind industry in the U.S. over the next decade.

Vineyard Wind spokesman Scott Farmelant called the Interior Department's decision "a surprise and disappointment."

"We urge the federal government to complete the review as quickly as possible," he said.

400,000 homes

Last month, Avangrid Chief Executive Officer Jim Torgerson said on a call with analysts that the project "will be challenged to move forward in its current configuration" if the final study is not issued by early September.

Massachusetts Governor Charlie Baker urged Bernhardt to expedite the review during a meeting last month. Afterward, Baker said he hoped to work with Vineyard Wind to resolve concerns about the installation. "We really want this project to happen," Baker told reporters after the meeting.

 

Vineyard Wind, which would have enough capacity to power about 400,000 homes, has a contract to sell power to three Massachusetts utilities for $65 per megawatt-hour -- a lower-than-expected price that encouraged other states to map out plans for offshore wind. That cost, however, hinged on a lucrative tax credit. The company may not be eligible to claim it if construction is delayed too long.

The study

An Interior Department environmental impact statement explored how Vineyard Wind may affect other industries and resources, including marine life. But the National Marine Fisheries Service raised concerns it looked too narrowly at potential cumulative effects on fishing, prompting the supplemental review, Bernhardt said.

"If it's going to be developed, it needs to be developed in a way that everyone gets to say, at least, that we didn't shave the ball," Bernhardt said.

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