December 4, 2013

Maine wind project could create 340 jobs, $120 million in investment

The PUC will decide if the pilot power project using floating turbines has enough positives to be worth the cost to ratepayers.

By Tux Turkel tturkel@pressherald.com
Staff Writer

(Continued from page 1)

click image to enlarge

A lobster boat passes the country’s first floating wind turbine, off the coast of Castine, in September.

Robert F. Bukaty/2013 Associated Press file

Related Documents

Contract terms of Maine Aqua Ventus project
Proposed term sheet from the wind farm's developers.

An economic impact report done for the project estimates that a second, larger phase could generate $330 million and 3,077 jobs over five years – and even more spending and jobs if the power output is increased.

Until October, the best hope for fulfilling those lofty ambitions appeared to rest with Statoil. The company had already put a steel, floating turbine in the North Sea. In 2011, it proposed a next-stage, 12-megawatt wind farm off Boothbay Harbor, called Hywind Maine.

Maine law caps the amount of money that electricity customers can pay to help subsidize ocean energy projects. Statoil initially proposed a rate of 29 cents per kilowatt hour, more than three times what a Maine household now pays for energy. The PUC balked at that, and Statoil trimmed it to 27 cents. The additional charge would have added up to $186 million over the 20-year contract. Spread among CMP’s customers, it worked out to about 75 cents a month.

Statoil also made commitments to enhance the project’s economic benefits, including spending at least $100 million to hire local suppliers and contractors for future commercial ventures.

Comparing the costs and benefits of the two projects is a bit tricky because Maine Aqua Ventus’ total impact on ratepayers hasn’t been made available. But in general, the 23 cents per kilowatt hour proposed by Maine Aqua Ventus is not much different. It also includes a 2.25 percent annual increase, to account for inflation.

APPEAL FOR SUPPORT FROM MAINERS

It’s common for pilot energy projects to have above-market rates, because of research and development and economies of scale, such as the expense of running undersea cables from the mainland to only two turbines, rather than several.

But the economic benefits promised by Maine Aqua Ventus appear to exceed what Statoil was offering, in terms of total spending and local hiring and procurement commitments. The concept of building the units onshore with Maine concrete and composite materials, rather than foreign-sourced steel, sets the Maine proposal apart from Statoil’s, Ward said.

“The more money you spend here, the greater the economic impact for Maine,” he said.

Those details will get a fresh look by the PUC, which until last summer had only the Statoil project to consider.

In January, the PUC voted 2-1 to award Statoil a power-purchase contract. Gov. Paul LePage said the potential economic benefits weren’t worth saddling ratepayers with millions of dollars in new electricity costs.

LePage’s distaste for the deal came to a head in June, when he 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 to LePage’s political maneuver 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.

In releasing its proposal Wednesday, Maine Aqua Ventus appealed to Maine residents to support the project, saying it is the state’s best chance to develop a new, clean and renewable energy source.

If the PUC approves the power-purchase agreement, Maine Aqua Ventus will face off against projects in New Jersey, Virginia, Texas, Ohio and Oregon for the federal money. Only three projects will be selected.

Tux Turkel can be contacted at 791-6462 or at:

tturkel@pressherald.com

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