The Maryland Public Service Commission has awarded offshore wind renewable energy credits (ORECs) to two projects to be built off the coast of Maryland.
The decision, announced on 11 May 2017, enables US Wind Inc and Skipjack Offshore Energy LLC to construct 368 megawatts (MW) of capacity.
“The approval today of the first large-scale offshore wind projects in the US brings to fruition the general assembly’s efforts to establish Maryland as a regional hub for this burgeoning industry,” said W Kevin Hughes, commission chairman. “We have taken great care to ensure that this decision maximises economic and environmental benefits to the state while minimising costs to Maryland ratepayers.”
Each company has been awarded ORECs at a levelised price of US$131.93 per megawatt hour (MWh) for a term of 20 years, beginning in January 2021 for US Wind and 2023 for Skipjack. According to the commission’s independent consultant, Levitan & Associates Inc, the net ratepayer bill impacts associated with the commission’s approval are projected to be less than US$1.40 per month for residential customers and less than a 1.4 per cent impact on the annual bills of commercial and industrial customers – both less than the ratepayer impacts authorised by the enabling legislation, the Maryland Offshore Wind Energy Act of 2013. These impacts will not take effect until electricity is actually generated by the projects. US Wind’s project is expected to be operational in early 2020; Skipjack anticipates being in operation near the end of 2022.
The companies will be required to use port facilities in the greater Baltimore region and Ocean City for construction and operations and maintenance activities. The developers must invest collectively at least US$76 million in a steel fabrication plant in Maryland and together fund at least US$39.6 million to support port upgrades at the Tradepoint Atlantic (formerly Sparrows Point) shipyard in Baltimore County.
“I believe this decision creates tremendous opportunities for Maryland,” said commissioner Michael T Richard. “It enables us to meet our clean, renewable energy goals using energy generated within the state while conditioning our approval on holding project developers to their promises of creating jobs and spurring economic growth. We have also acted to keep costs as low as possible to maximise the investment and benefit for Maryland’s electric customers.”
An important condition of the approval will require each developer to create opportunities for minority-owned companies to participate as investors as well as in the development and construction of the projects. “All Maryland citizens can benefit from the economic opportunities these projects will create,” said commissioner Harold D Williams.
The companies must notify the commission by 25 May 2017 whether they accept the conditions of approval contained in the order.