HALLOWELL — After months of uncertainty, Maine is back in the offshore wind energy game.
The Maine Public Utilities Commission voted Tuesday to approve a power-purchase contract for a pilot project that advocates hope will set the stage for a deep-water wind power industry that could eventually create thousands of jobs and billions of dollars in spending.
The 2-1 vote was critical to the Maine Aqua Ventus pilot project’s ability to move forward. This spring, the federal Department of Energy will decide whether the technology behind it is innovative enough to warrant a $46 million grant aimed at creating large wind farms, far out at sea, that can produce power at competitive rates.
Maine Aqua Ventus is being proposed by Maine Prime Technologies, a for-profit spinoff that represents the University of Maine and two general partners: Maine-based Cianbro Corp. and Emera Inc. of Nova Scotia, which owns the two largest utilities in northern and eastern Maine.
In May, the partners launched a one-eighth-scale model of a floating turbine off Castine. The unit is made of advanced composite materials designed to fight corrosion and reduce weight. Its hull is made of concrete, which can be produced in Maine and has a longer life span in the ocean than steel.
The prototype is now generating a small amount of power and collecting information. It already has endured extreme sea and wind conditions.
If they win the federal grant, the developers plan to build a full-scale, pilot wind farm off Monhegan Island by 2016. It would consist of two turbines, each with a capacity to generate six megawatts. The project is expected to generate 43,000 megawatt-hours a year, enough to power 6,000 average homes.
It also would draw an investment of $120 million to $166 million and as many as 341 jobs, say the project developers. They say they will try to ease concerns, including the project’s impact on fishing and scenery, among some residents and visitors to Monhegan, and in the midcoast town of Bristol, where an undersea cable would come ashore.
“We’re very happy with the approval,” said Jeff Thaler, an assistant counsel at the University of Maine. “We now will continue discussions with the PUC staff and local interests to finalize the term sheet.”
In their deliberations, the three commissioners debated the merits of the project, including the role of government in economic development, the impact on ratepayers and the prospects of the pilot project leading to commercial-scale, floating wind farms.
All three acknowledged elements of risk. But the two who voted to approve the project, David Littell and Chairman Tom Welch, said the project meets the legal benchmarks of Maine’s four-year-old Ocean Energy Act, which was passed to encourage such development.
Commissioner Mark Vannoy offered a differing view. He applauded the project’s technical innovations but said he sees little chance in the foreseeable future that offshore wind power will become cost-competitive with conventional sources such as the most efficient natural-gas-fired plants.
The above-market rates needed to develop the project would add a small charge for 20 years to Central Maine Power Co. customers’ bills. The allocations among customer classes could change over time, but the latest estimate is that an average residential customer would pay an additional 73 cents a month, $8.70 in the project’s first year. That figure would rise slightly each year, based on a formula for inflation.
PHILOSOPHICAL SPLIT PERSISTS
The philosophical split on the panel was identical to the positions taken in January 2013, when the PUC voted by the same margin to approve a power-purchase contract for a similar project proposed by the Norwegian energy giant Statoil.
The company had already put a steel, floating turbine in the North Sea. In 2011, responding to a request for proposals from the PUC, it applied to build a next-stage, 12-megawatt wind farm off Boothbay Harbor.
But Gov. Paul LePage opposed the project, saying the potential economic benefits weren’t worth saddling ratepayers with millions of dollars in above-market-rate electricity costs.
In June, LePage pressured the Legislature into passing a law that had the effect of reopening the PUC’s bidding process. Maine Aqua Ventus responded by submitting its proposal in late August.
Statoil responded by putting its $120 million project on hold. In mid-October, the company announced that it was pulling out of Maine. It blamed shifting state policies and said it would redirect investment to a site off Scotland.
LePage has not opposed Maine Aqua Ventus, even though its impact on ratepayers is similar to that of the Statoil project. The Maine-based project offers more extensive economic benefits, in total spending and local hiring, procurement commitments and participation by university students. The concept of building the units onshore with Maine concrete and composite materials, rather than foreign-sourced steel, also sets the Maine proposal apart from Statoil’s.
GOVERNOR WILL SUPPORT PROJECT
LePage’s energy director, Patrick Woodcock, said after Tuesday’s deliberation that the governor wants to help make the project successful and would lend his support to the federal grant process.
Maine Aqua Ventus now faces off against projects in New Jersey, Virginia, Texas, Ohio and Oregon for the federal money. Three projects will be selected.
Habib Dagher, the UMaine professor who is leading the project, said federal energy officials are especially interested in design technology that can bring down the cost of commercial, offshore wind power. The concrete and composite materials used by Maine Aqua Ventus will do that, Dagher said, and the project is the only one with a scaled-down prototype in U.S. waters to test the theories.
The unit proposed for Oregon, by Principle Power of Portugal, is based on a prototype launched in that country in 2012.
“We’re not just replicating what Europe has done,” Dagher said. “We’re taking it in a new direction.”
A project update on the one-eighth-scale unit is set for Thursday morning at a meeting of the Environmental & Energy Technology Council at the University of Southern Maine in Portland. It will feature presentations by Dagher and Red Webster, a senior project manager for Cianbro Corp., which helped build the unit.
Tux Turkel can be contacted at 791-6462 or at: