Posted on November 22, 2024
Gov. Maura Healey doubled down Tuesday on the state’s commitment to offshore wind amid signals that the federal government could soon turn far more antagonistic to the growing sector, telling a union hall audience that the partnership of organized labor and the clean energy industry gives Massachusetts “a special sauce” that positions it to continue its energy transition.
Development of a robust offshore wind industry is key to Massachusetts’ decarbonization commitments and is seen as a sector that could provide an array of new jobs for residents. But President-elect Donald Trump, who dealt a setback to the offshore wind industry during his first term, has said about wind power that he intends to “make sure that that ends on Day 1” of his new administration in January.
“Mark my words: We will show them. Because we’re moving ahead. We’ll show them,” Healey said Tuesday at an event in Taunton, referring to skeptics generally. “We’ll get this done, and people will be behind it.”
The governor spoke at IBEW Local 223 as union-backed “climate jobs” coalitions from Massachusetts, Connecticut, and Rhode Island called in a new report for Southern New England to “double down on offshore wind and go bigger and bolder on clean energy and high-quality union jobs.” Without speaking his name, Healey acknowledged that Trump’s victory has clouded the outlook for the industry.
“As we look ahead, there’s a certain amount of uncertainty with the new administration. But I firmly believe that the fabric of this industry, of this clean energy industry, is strong. You know, we have private corporations, we have research institutions, we have incredible union leadership and unions, and we have our friends in the environmental community who we credit for so much of the advocacy and helping us move forward to this place of a better understanding that we need to act now,” she said. “We have it in this room, all those players. So we’re moving forward.”
She added, “The race is on. Whoever figures out best how to marry the technologies and where we need to go — energy with the workforce — is going to win, and we have a special sauce here that nobody else has.”
Wind opponents at the right-leaning Mass. Fiscal Alliance say offshore wind is bad for the environment, the economy and ratepayers. The group recently told supporters that it will lobby the incoming Trump administration to settle wind-related litigation “in favor of all the offshore wind opposition plaintiffs” and to move to amend federal law to “remove offshore wind as an allowed option.”
“Governor Healey will not be happy. Her administration’s regulators are some of the biggest cheerleaders for this boondoggle. The Governor will bellyache that the state has to meet its self-imposed, arbitrary CO2 reduction mandates and her allies in the media will make it sound like the world is coming to an end because offshore wind is dead,” spokesman Paul Craney wrote in an email to supporters. “The reality is that even the federal agencies under the Biden Harris administration admitted, offshore wind will have a negligible impact on global temperatures.”
The union-led groups said that Southern New England has experienced the most severe rise in average temperatures in the continental U.S. since the beginning of the 20th century — average temperatures 3.5 degrees higher now in Massachusetts and Connecticut, and 4 degrees higher in Rhode Island.
In a report released Tuesday, the groups said their three states should now leverage incentives in federal laws like the Inflation Reduction Act, increase their offshore wind capacity targets, and begin “coordinating a large-scale offshore wind development plan that will over time lower average costs per megawatt of new capacity.”
“A larger scale of development is also needed to meet the region’s rising demand for electricity while protecting the public from unnecessary rate increases. Using the IRA’s incentives, Southern New England can build out its regional offshore wind industry to achieve economies of scale that will drive down project costs for developers while reducing costs for consumers,” the report says.
The union coalition’s report points to a projection from the U.S. Department of Energy and National Renewable Energy Laboratory that offshore wind power prices “will halve within a decade” with the development of the industry, but later explains that the feds expect lower interest rates, supply chain maturation, and IRA incentives “to drive costs back down to pre-pandemic levels by 2030.”
The pricing details for the state’s latest slate of offshore wind projects — 2,678 megawatts spread across three projects — won’t be available until contracts are put on file this winter and it is clearly a sensitive topic for the industry and its boosters in state government. The projects chosen in September are widely expected to cost ratepayers more than previous projects, and contract prices for similarly rebid projects in New York recently came in about 30 percent higher.
The Healey administration has only said that the next round of projects will be cost effective when compared to the cost of building other power generation projects in the future.
The union report cited a paper prepared this summer by Industrial Economics, Incorporated for the Environmental League of Massachusetts. The paper describes and evaluates a “modeling analysis of electricity price impacts” that it says was conducted by Worcester-based Daymark Energy Advisors on behalf of Avangrid, the Spanish utility giant behind the New England Wind 1 selected in September.
Using recent contracts from New York and New Jersey as a proxy, the Daymark analysis considered the monthly change to an average ratepayer’s electricity bill if 3,600 MW of offshore wind capacity cost $140 per megawatt hour (MWh), $160 per MWh, and $180 per MWh. The 20-year average cost of the contracts associated with Vineyard Wind 1 — the only offshore wind contract in effect more than eight years after a 2016 law encouraged a large-scale pursuit of wind — is $84.23 per MWh in levelized nominal dollar terms.
Industrial Economics told ELM that the Daymark analysis “projects that the monthly bill impact per household would vary from a small cost savings (effectively no impact) under the $140/MWh scenario to a $2.27 monthly increase under the $180/MWh scenario.”
