Officials in Maryland paved the way last week for what they are calling the nation’s first large-scale offshore wind projects. The Maryland Public Service Commission granted offshore wind renewable energy credits, otherwise known as ORECs, to two proposed wind projects with a combined value of $2.09 billion.
U.S. Wind Inc. and Skipjack Offshore Energy LLC would build a total of 368 megawatts of capacity, which state officials say would create nearly 9,700 jobs and pump $74 million in state tax revenues during a 20-year period.
In a statement, MPSC chairman W. Kevin Hughes says the projects would “establish Maryland as a regional hub for this burgeoning industry. We have taken great care to ensure that this decision maximizes economic and environmental benefits to the state while minimizing costs to Maryland ratepayers.”
The MPSC had a long list of conditions when it granted the ORECs, including that developers create a minimum of 4,977 direct jobs during development, construction and operation phases of the projects and pass 80% of construction costs savings to ratepayers.
Other requirements put on the developers include using local port facilities in Baltimore and Ocean City, Md. for construction, operations and maintenance. They must also invest a total of $76 million in a steel fabrication plant and use minority-owned companies and investors.
The two firms, which have until May 25 to formally accept the conditions, will also have to have the projects approved by the federal government.
The projects are expected to reduce carbon dioxide emissions by 19,000 tons per year for 20 years. Maryland hopes to reduce carbon emissions by 40% by 2030. A 2013 state law also mandates that renewable energy accounts for 25% of the electricity purchased by 2020, including 2.5% of total retail electricity sales coming from offshore wind.
The commission, however, recognized that some factions in the state are concerned that the turbines will have a negative impact on tourism if they disrupt the aesthetic of the state’s shoreline, especially in Ocean City, one of the state’s most popular beach towns.
“As a condition of our order, US Wind is required to locate its project as far to the east (away from the shoreline) of the designated wind energy area as practical,” Commissioner Anthony O’Donnell says in a statement. “Each developer also must take advantage of the best commercially-available technology to lessen views of the wind turbines by beach-goers and residents, both during the day and at night.”
The 20-year terms under the ORECs would begin in January 2021 for U.S. Wind and 2023 for Skipjack. The U.S. Wind project is slated to be completed in 2020 and Skipjack says it will be done in 2022.