Offshore Wind Wire

By David McGlinchey

A Michigan panel proposed offshore wind legislation this week to Gov. Jennfier Granholm and the state legislature, potentially delivering some clarity to the industry as it explores wind energy potential on the Great Lakes.

The draft legislation includes live auctions to award offshore wind leases and a framework that allows state officials or developers to nominate lease areas.  The Michigan Department of Energy, Labor & Economic Growth will identify some initial “offshore wind resource planning areas” and hold public auctions for those leases “as soon as practicable following enactment” of the legislation.  Developers will be able to suggest other areas for offshore wind leasing.  If the department approves those areas, the sites will go up for public auction as well.

The proposal was generated by the Great Lakes Wind Council, which was formed by Gov. Granholm in early 2009.  The council has 32 members, including officials from state agencies, a representative from Bluewater Wind and several from onshore wind developers.

The draft legislation will be sent to the Michigan legislature, where it will either replace existing offshore wind proposals or be introduced as a new bill.  In the Senate it will be considered by the Natural Resources and Environmental Affairs Committee.  In the House, the Energy and Technology Committee will take up the bill.  There are also “moratorium bills” circulating in the Michigan legislature, which would block any offshore wind development, according to Liesl Clark, deputy director of the Department of Energy, Labor & Economic Growth.  Clark noted, however, that the recently introduced draft legislation has some early support.

“There are interested parties on both sides of the aisle and in both chambers,” Clark said.

The proposed legislation also includes a trust fund to collect the lease payments.  Under the plan, at least 70 percent of the Great Lakes Wind Energy Trust Fund will be used to “research and monitor the impact of offshore wind development and address or offset any negative impacts that may be found.”  At least 23 percent of the lease payments will be used to support renewable energy and energy efficiency projects.  Less than seven percent will be used to support the program.

The legislation comes at a particularly sensitive time in the state, several months after Scandia Wind Offshore proposed a 1,000 megawatt (MW) wind farm in Lake Michigan.  That plan was met with intense local opposition.  According to local news reports, Scandia submitted a new proposal this week with half as much capacity.  Clark said, however, that the Scandia proposal has provided a valueable spark to get stakeholders engaged in the planning process.

“They’ve been engaged with the public, they’ve really changed the conversation,” Clark said of the Scandia effort.  “They have got people engaged [in the planning process] who otherwise might not have been… with some very articulate concerns.”

The draft legislation requires significant public input at several points in the development process, including public hearings and comment periods before leases or construction and operation permits can be awarded.