Ocean City Today

Terms and conditions apply to two approved wind farms

By Brian Gilliland | May 18, 2017
Map of the offshore wind lease areas in Maryland and Delaware

(May 19, 2017) Now that both proposals for offshore wind farms have been granted provisional approval, both US Wind and Skipjack Wind can begin their respective projects in earnest, but are still subject to certain conditions by the state’s Public Service Commission.

US Wind had 27 conditions placed on its project, and Skipjack had 28, though the two sets of rules are largely similar in scope — many with minor changes in amounts and percentages.

The two companies have until May 25 to accept or reject the conditions. Paul Rich, project development director for US Wind, said the conditions are acceptable to his company, though he expects some specifics to be finalized before the deadline.

According to a release by Skipjack’s parent company, Deepwater Wind, the company does not directly address the May 25 deadline, only that it looks forward to continuing the conversation with the Ocean City community.

Addressing the most common concerns and criticisms of the project are conditions that require both companies to use the best commercially available technology to minimize both daytime and nighttime views of the wind farm, as well as above-ground and underwater sound generation.

Remaining underwater, both projects are required to develop all appropriate precautionary measures to ensure marine mammals are protected at all phases of the project, and all environmental remediation and mitigation measures though the best commercially available means.

Birds are not mentioned in the requirements.

As part of the construction project, pile driving is limited to daytime hours only.

Both projects have a decommissioning plan on file with the federal Bureau of Ocean Energy Management should the projects not work out, and any modifications to that plan must be submitted to both the PSC and BOEM at the same time.

Each project is expected to create a certain number of jobs, accounted for by full-time equivalent positions in the PSC report. US Wind is required to create at least 1,298 in-state direct development or construction period jobs and 2,282 direct operating period jobs. Skipjack is required to create at least 913 development or construction period jobs and 484 direct operating period jobs.

Both entities are required to submit ongoing, independently audited reports on job creation.

US Wind is required to spend 19 percent of capital expenditures in Maryland, and Skipjack is required to spend 34 percent in Maryland.

Both projects are required to use a port facility in the greater Baltimore region as the marshaling port, where the components of the project are transported and loaded onto the installation vessel. A port in the Ocean City region will be used as the operations and maintenance port.

Both projects are required to maintain an office in Maryland for the life of the project.

If there are cost savings via efficiencies or grant funding, which both businesses are required to apply for, those savings must be returned to the ratepayers at a rate of 80 percent of the savings within six months.

There is a threshold of seven percent from the construction report estimate made with each project’s application before the companies have to pay out on realized savings. Additionally, ratepayers, purchasers of offshore renewable energy credits and the state are to be held harmless for any cost overruns.

As for the energy credits, US Wind is allowed to sell almost 914,000 at an amount not to exceed $131.93, valued in 2012 dollars, beginning on Jan. 1, 2020. Skipjack is entitled to sell 455,482 at the same rate, beginning on Jan. 1, 2023. Both companies can sell ORECs for 20 years.

Skipjack is subject to one condition US Wind is not, which is to conduct comprehensive and timely outreach to both Maryland and Delaware local, state and federal officials and agencies involving, but not limited to the siting of the project. A report summarizing these efforts and any conditions Skipjack voluntarily agrees to must be delivered within six months.

US Wind is subject to a condition that Skipjack is not, which is to locate the project in the eastern-most portion of its lease area that can reasonably and practicably do so.

The full report of the case and the PSC rulings on the matter are located as Case 9431 found on the public service commission’s website, www.psc.state.md.us.

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