The Bureau of Ocean Energy Management (BOEM) today announced that it reduced the size of the offshore Wind Energy Area between Rhode Island and Massachusetts by excluding commercially important fishing grounds.

The reduced Wind Energy Area includes approximately 164,750 acres within the original area identified by Rhode Island and Massachusetts in a 2010 memorandum of understanding.

The area is one of several along the Atlantic coast with high wind potential that BOEM is evaluating for commercial wind leasing.

“Today’s announcement is an important step toward development of our nation’s remarkable wind energy resource offshore Rhode Island and Massachusetts,” said Department of Interior Deputy Secretary David Hayes. “The Department will continue to do its part to build a world-class offshore wind industry that provides clean, reliable, home-grown power and the American jobs that come with it.”

The Wind Energy Area will be identified and permitted under the Department of the Interior’s “Smart from the Start” wind energy initiative. BOEM’s decision to remove certain commercial fishing grounds from the proposed Wind Energy Area comes as a result of extensive meetings with the regional fishing industry over the past two years. Other key considerations that will be further analyzed in the environmental assessment include the critically endangered North Atlantic Right Whale, vessel traffic and visual and cultural resources.

Earlier this week, Offshore Wind Development Coalition President Jim Lanard called the Right Whale the most significant environmental challenge facing the industry. He added, however, that the challenge can be overcome with due environmental diligence.

“BOEM identified this Wind Energy Area following extensive collaboration with Rhode Island, Massachusetts and a diverse set of stakeholders, including fishing interests,” said BOEM Director Tommy Beaudreau. “This milestone is ‘Smart from the Start’ because it will help ensure that offshore wind projects are sited in the right places, where the wind energy potential is significant and where environmental effects and potential conflicts with other uses can be minimized and managed.”

According to a press release sent Thursday evening, BOEM Deputy Director Walter Cruickshank and BOEM Renewable Energy Program Manager Maureen Bornholdt will discuss the announcement with stakeholders in a Friday afternoon call.

Bordholdt has been the Bureau’s point person for community relations in the region over the past two years. She has met repeatedly with the fishing community in New Bedford, MA, affluent residents of Martha’s Vineyard and state and industry leaders in Boston to explain federal offshore wind plans and to gather feedback.

[Editor's Note: An earlier version of this article indicated that the announcement would be made during the 4 pm call and that the call was open to the public. BOEM officials have clarified that the call is a "stakeholder" discussion only.]

Welcome to the November edition, where we ask our experts which state will host the country’s first offshore wind turbines. And oh my, how the playing field has changed since we last checked in.

After holding the top spot for the first four rankings — and really, for the past decade — Massachusetts is no longer the favorite to build the first US offshore wind farm. Thanks to strong political backing, a project in state waters and an apparent absence of local opposition, New Jersey has taken the lead. Fishermen’s Energy has an outside chance to begin construction before the end of this calendar year.

Rhode Island also surged in the vote totals to take second place. Deepwater Wind cleared a huge hurdle when the state’s Supreme Court rejected a challenge to the company’s power purchase agreement with National Grid. Deepwater is now pushing forward to secure the remaining permits and plans to begin construction of its Block Island offshore wind farm in 2013 or 2014.

Cape Wind, meanwhile, suffered a potential setback last week when a federal court vacated its FAA “no hazard” ruling. That challenge, difficulty selling the project’s remaining power and the continued opposition of William Koch’s Alliance to Protect Nantucket Sound caused Massachusetts to slide all the way to the third slot in the rankings.

1) New Jersey: “I don’t like to say we’re going to be first, but we have a good shot,’’ said Rhonda Jackson of Fishermen’s Energy, discussing the Atlantic City project.

2) Rhode Island: Deepwater Wind announced last month that they are buying Siemens’ 6 megawatt turbines for their Block Island project.

3) Massachusetts: Cape Wind continues to face well-funded opposition and must obtain another “no hazard” determination from the FAA. But don’t forget, this is the only project that has a signed federal lease.

4) Texas: The Lone Star State has built in advantages, but we’ve been saying that for two years now.

5) Maryland: In his opening address to AWEA’s annual offshore wind conference last month, Gov. Martin O’Malley promised to push his offshore wind plan.

The announcement was made today by Deepwater CEO William Moore and Thomas Mousten, head of Siemens Offshore Wind Americas, during the American Wind Energy Association’s annual offshore wind conference. The company will buy five turbines for the test project, which will be located off of Block Island in Rhode Island.

In a statement released before the announcement, Moore said the turbine “is the future of offshore wind” and “will move the whole industry forward.”

The six-megawatt turbine will be the largest ever developed. By comparison, the turbines that will be used at the proposed Cape Wind project are 3.6 MW.

Moore and Mousten were hesitant to delve into the specifics the turbine or the cost of the Block Island deal. Mousten did say that the turbines would have 120-meter rotor diameter.

The Block Island project had previously been stalled by a lawsuit that challenged the company’s power purchase agreement with National Grid. The Rhode Island Supreme Court rejected that challenge last month, and Deepwater officials are now pushing the project forward.

In an interview with Offshore Wind Wire last month, Moore described the Supreme Court decision as “extremely good news for the project.” He said that the company would submit permit applications to federal and state agencies in the first quarter of 2012.

At the press conference today, Moore said that the company is looking to begin construction on the Block Island wind farm in 2013 and begin operations in 2014 or 2015.

Uncertainty has its costs.  Clinical studies confirm what we all know intuitively: uncertainty about what may happen in the future makes it harder for us not only to make plans but also to achieve them.

Uncertainty can impact offshore wind projects in several ways.  Developers face uncertainty over regulatory regimes, the availability of leases for sites, and whether they will find counterparties for long-term power purchase agreements.

Utilities and electricity consumers interested in buying power from offshore wind projects face similar uncertainties.  Will a given offshore wind project actually be built?  When a utility enters into a contract to buy power from an offshore wind project, the utility typically has the right to expect that it will actually be able to take delivery of that power to serve its customers.  Despite the reality of European offshore wind, the fact that the first American offshore wind project has yet to be constructed makes some potential purchasers uncertain as to whether US projects will be built.

For example, consider Block Island off Rhode Island.  The island – not connected to the mainland by electricity cables – is looking for a better solution to its energy needs than the expensive diesel generators that have served it for years.  An offshore wind pilot project by Deepwater Wind has been proposed as part of a possible solution.  As the town of New Shoreham plans for its energy future, questions have arisen over whether Block Island should expect to be able to tap into the power produced by the offshore wind pilot project.  Some islanders oppose the Block Island offshore wind project, while others more open to the concept are skeptical that the project will ultimately be constructed.  Uncertainty about the Block Island project is thus leading to the consideration of alternatives, such as an underwater cable to import power from the mainland.

As recently reported in the Wilmington News Journal, uncertainty also surrounds a possible offshore wind project off Delaware.  Faced with a 2012 state deadline to procure renewable power, the Delaware Municipal Electric Corporation (DEMEC) entered into a contract with offshore wind developer Bluewater Wind to buy part of the output of its proposed offshore wind project.  While DEMEC’s contract is for a much smaller share of the Bluewater Wind project’s output than that purchased by Delmarva Power in 2008, DEMEC nevertheless needs to buy renewable power to comply with Delaware’s renewable portfolio standard.  Now, faced with what DEMEC has called “the increasingly unlikely chances the Bluewater Wind project will be built anytime soon”, DEMEC has entered into a contract with Duke Energy Renewables to purchase all power produced by a 69 megawatt land-based wind facility to be built in Pennsylvania.  DEMEC pointed to “increasing federal uncertainty about offshore wind subsidies” to explain its decision to hedge its offshore wind contract with terrestrial wind.  While DEMEC’s move does not mean it will not gladly pay for the Bluewater Wind project’s output if and when it is built, the utility’s perceived need to hedge its offshore wind contract with terrestrial wind highlights the uncertainty surrounding offshore wind in the U.S.

Uncertainty about U.S. offshore wind may not be a barrier to its ultimate development, but these examples demonstrate how uncertainty affects the choices people make.  Time will tell whether offshore wind will power consumers lives in Rhode Island and Delaware in the near future.  In the meantime, many eyes will be watching the sea for a sign of what the future will bring.

Todd J. Griset practices energy law with Preti Flaherty Beliveau & Pachios in Maine. He also writes a blog on offshore wind, renewable energy and policy issues.

Rhode Island may be the U.S. state with the smallest land area, but its nickname – the “Ocean State” – highlights one of its largest resources.  Between the mainland and over 30 islands, Rhode Island has 384 miles of tidal shoreline.  Centered around Narragansett Bay and Block Island Sound, Rhode Island’s ocean holdings cover about 14 percent of the state’s total area.  These waters are home to an offshore wind resource that is attracting growing interest, especially when combined with federal waters over the outer continental shelf.

One Rhode Island offshore wind project has taken a number of concrete steps toward development.  Deepwater Wind has proposed a demonstration-scale, 30 megawatt wind farm in state waters about 3 miles off the southern tip of remote Block Island.  About 13 miles south of the mainland, Block Island is not electrically interconnected to the mainland grid; as on some other remote island communities, residents and businesses on the island rely on expensive diesel generators for their power.  (The Block Island Power Company tariff sheets on file with the Rhode Island Public Utilities Commission show a summer rate of $34.89 per month plus 23.99 cents per kilowatt-hour – even higher than Rhode Island’s 8^th-in-the-nation average retail price of 14.23 cents per kWh.)  Deepwater Wind’s proposed pilot project is designed not only to provide the island cost-effective power but to generate far more than Block Island’s electricity needs, with an estimated 90 percent of the wind farm’s output planned for sale to the mainland electric grid.

Offshore wind developers generally must find a buyer for a project’s output before completing project finance and construction.  In December 2009, Deepwater Wind signed a power purchase agreement with utility National Grid.  A revised version of that contract was approved by the state public utilities commission in April 2010, setting a starting price of 24.4 cents per kWh for the project’s output.  Two industrial energy consumers and an environmental group challenged the state commission’s approval of the contract, arguing that the contract violates law and policy and will raise consumers’ rates.  This summer, the Rhode Island Supreme Court upheld the commission’s approval of the contract.  The court expressed concerns over the state’s legislative mandate to pursue offshore wind but found that the commission properly approved the contract under the statutory criteria:

Although we view with trepidation the General Assembly’s unwavering quest to sink this demonstration wind farm into the sediment of Rhode Island’s continental shelf, we nonetheless are constrained by our standard of review and the bounds of the [offshore wind] statute… The record shall be remanded to the commission with our decision endorsed upon it.  In so deciding, it is this Court’s fervent hope that our Legislature’s William Seward-esque policy decision championing this amended purchase-power agreement proves as lucrative and majestic as the Alaska Purchase of 1867.

With this court challenge cleared, Deepwater Wind’s Block Island project is thus moving forward.  The Block Island project will be a topic for discussion at this week’s Rhode Island community forum on the state’s possible future with offshore wind.  Sponsored by Rhode Island Foundation and WRNI, Rhode Island’s NPR station, the free public forum will include panel presentations and discussion with speakers including former Rhode Island Gov. Donald Carcieri, executive directors of environmental groups, a representative from developer Deepwater Wind, and professors from the University of Rhode Island.

Beyond Rhode Island’s state waters, nearby federal waters offer offshore wind potential.  Last month, the U.S Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) issued a Call for Information and Nominations (9 page PDF) to solicit interest in developing offshore wind projects on the Outer Continental Shelf off Rhode Island and Massachusetts.  The Call seeks to gauge developers’ interest in leasing offshore wind sites in an “Area of Mutual Interest” designated by the governors of Rhode Island and Massachusetts.  Developers are now preparing their responses, seeking to claim sites for future wind projects offshore Rhode Island.

Todd J. Griset practices energy law with Preti Flaherty Beliveau & Pachios in Maine. He also writes a blog on offshore wind, renewable energy and policy issues.

Offshore wind off the New England coast has been in the spotlight of late.

As a region, New England offers a strong offshore wind resource and is particularly rich in deep water sites.  The region also offers a number of deep water ports, many with useful infrastructure but depressed local economies, highlighting the onshore services and supply chain opportunity for the region.  Geography and demography combine to place potential New England offshore wind sites relatively close to major load pockets from Boston south.  These features make New England’s waters attractive to offshore wind developers.

Regulatory initiatives also play a part in the recent interest in New England’s offshore wind resource.  Last week, U.S Secretary of the Interior Ken Salazar toured the region to promote the department’s Smart from the Start offshore wind program.  Secretary Salazar announced the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE)’s issuance of a Call for Information and Nominations (9 page PDF) to solicit interest in developing offshore wind projects on the Outer Continental Shelf off Massachusetts and Rhode Island.

Structurally a bureau within the Department of the Interior, BOEMRE is responsible for leasing federally-owned submerged lands for energy development.  Typically, after the process is initiated by a Call, a developer enters into a commercial wind energy lease with BOEMRE.  This lease gives the developer the exclusive right to study the site, and to seek final approval from BOEMRE to construct and operate the project.  Once a developer secures its site lease, the developer must secure BOEMRE’s approval of its plan to assess the site’s potential and characteristics like meteorological and subsea conditions.  Construction and operation of the project will require a third BOEMRE approval.

In the recently-announced Call, BOEMRE describes an area of the Outer Continental Shelf previously identified as an “Area of Mutual Interest” in a memorandum of understanding between the governors of Rhode Island and Massachusetts.  This area is divided into two blocks: a small block beginning approximately 9 nautical miles southeast of Point Judith, Rhode Island, and a much larger (246 square nautical miles) block beginning approximately 10 nautical miles south of Newport, Rhode Island, and extending approximately 20 nautical miles seaward.

This Call covering southern New England waters follows a similar call covering New Jersey, as well as previous wind energy area designations off Delaware and Maryland.  As in these mid-Atlantic areas, BOEMRE has announced its intent to prepare an Environmental Assessment (EA) to analyze the effects of its offshore wind site leasing program off Rhode Island and Massachusetts.  The National Environmental Policy Act requires BOEMRE to analyze the reasonably foreseeable consequences of offering project site leases prior to doing so.  The agency’s recently-issued draft EA for sites on the Outer Continental Shelf off New Jersey, Delaware, Maryland and Virginia may serve as a model for the southern New England EA.

Whatever its form, the southern New England EA will present BOEMRE’s evaluation of the environmental impacts of lease issuance and site assessment plan approval.  Notably, BOEMRE’s environmental assessment will not be an analysis of the impacts of approving the ultimate development of any site, nor an analysis of the impacts of any particular project.  Nevertheless, the New England EA will represent the next step toward lease issuance in the region.

Nominations responding to the Call are due by October 3, 2011.  One developer – start up Neptune Wind LLC – has already made a statement that it intends to file its interest for a lease in these waters.  Neptune’s proposed Noman’s Wind project is proposed for a site 20 miles south of the border between Massachusetts and Rhode Island; current plans suggest 80 to 100 turbines totaling 500 MW in capacity.  Other developers are anticipated to express interest in leasing sites in the designated area.

Todd J. Griset practices energy law with Preti Flaherty Beliveau & Pachios in Maine. He also writes a blog on offshore wind, renewable energy and policy issues.

Salazar is scheduled to meet with state officials, including Gov. Lincoln Chafee, according to the report.

UMaine Offshore Wind Lab Set For November Opening

The University of Maine’s Offshore Wind Laboratory at the Advanced Structures and Composites Center received its certificate of occupancy this spring and employees have been working at the lab during the summer, the Bangor Daily News reported on Friday.

The $17.5 million blade testing facility is scheduled to open in November. The project was funded by the National Institute of Standards and Technology and the Maine Technology Institute, according to the report.

German Report Suggests Bubble Wrap To Contain Installation Noise

The German Federal Agency for Nature Conservation has released a report suggesting surrounding offshore wind farm construction sites with “bubble curtains” to contain underwater noise, Spiegel Online reported last week.

“A bubble curtain is one way to minimize noise and potentially reduce the impact of offshore wind farm construction on sea life,” said Greenpeace oceans & biodiversity campaigner Thilo Maack.

The wind farm in Aberdeen bay would include 11 turbines and is currently being reviewed by regulators.  Trump is reportedly concerned about the impact on the view from the golf course. Trumps neighbors suggested that he is acting hypocritically in opposing the wind farm after his business development in the area.

“How can a man who has just destroyed a site of special scientific interest and is in the process of despoiling an area of outstanding natural beauty with his golf course, comment on the view? It’s laughable,” said neighbor David Milne.

Offshore Wind Panel Scheduled In Maine

The Maine-based Island Institute will hold a public event on August 11 to discuss offshore wind development in the Gulf of Maine, Maine’s Free Press reported yesterday.

Deepwater Wind Resumes Studies After Winning Appeal

Deepwater Wind has responded to a victory in the Rhode Island Supreme Court last month by resuming geological and oceanographic studies for its Block Island wind farm, the Providence Journal reported last week.

The company won an appeal that was lodged against the power purchase agreement for the project.

“When the appeal was lodged last August, we had to completely postpone all the field work,” said Deepwater CEO William Moore. “We lost a year to the appeal.”

Moore said the project could still be operational in 2013.

“It’s definitely manageable,” he said.

NStar and Northeast Utilities are seeking a merger but the process is under review by Massachusetts energy regulators.

The Globe columnist — Steve Syre — wrote today that the most recent idea discussed by state officials and utility executives is for the merger to be approved in exchange for rate relief, rate increase restrictions and a deal to buy 25 percent of Cape Wind’s electricity. He made clear that this deal was merely discussed, not agreed to or finalized.

A spokesman for Massachusetts Energy and Environment Secretary Richard Sullivan told Syre that discussions about the merger and about Cape Wind are separate.

NOAA Approves Rhode Island Ocean Plan

The National Oceanic and Atmospheric Administration approved the Rhode Island Ocean Special Area Management Plan, which identified the best areas near the state for offshore wind development, the Providence Business News reported today.

NOAA Administrator Jane Lubchenco appeared today with Gov. Lincoln Chafee at the University of Rhode Island’s Narragansett campus to sign the plan.

“By developing this plan, Rhode Island has emerged as a national leader in coastal management and ocean stewardship,” Lubchenco said.