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CHESTO MEANS BUSINESS

In the offshore wind industry’s East Coast arms race, Mass. falls behind New York

Equinor cuts deals in the Empire State for two massive projects as Bay State lawmakers confront the governor’s climate bill veto

This five-turbine wind farm near Block Island is the only one that has been built off the New England coast so far.
This five-turbine wind farm near Block Island is the only one that has been built off the New England coast so far.Eric Thayer/Bloomberg

Don’t look now, but New York has suddenly pulled ahead of Massachusetts in the arms race for the offshore wind industry, and the jobs it can bring. Way ahead.

Last week, the wind farm developer Equinor won contracts to provide New Yorkers with power from two massive projects, one to be built south of Long Island and the other south of Martha’s Vineyard and Nantucket. The contracts total nearly 2,500 megawatts of capacity, enough electricity for more than 1.2 million homes.

A bonus: the promise to bring hundreds of jobs to Brooklyn and the Albany area, as two old industrial ports are revived. Until this point, New York had roughly the same amount under contract as the 1,600 megawatts planned for Massachusetts.

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But as the Buffalo law firm Hodgson Russ puts it, the Equinor contracts, backed in part by BP, position New York as the “undeniable center of gravity” for the burgeoning industry in the United States.

A day after the Equinor announcement, Governor Charlie Baker vetoed a wide-ranging climate bill that would have, among many other things, increased the state’s authority for offshore wind contracts and accelerated the state’s renewable energy requirements for utilities. Legislative leaders vowed to quickly return the bill to his desk in the new two-year legislative session.

Industry insiders certainly took notice. Of particular alarm to offshore wind advocates: language in Baker’s veto message that signals a potential shift in direction. He said he wants to move Massachusetts away from long-term contract auctions in favor of a more regional, market-based solution that would no longer give offshore wind special treatment over other sources.

So much for first-mover advantage. The concept of offshore wind tantalized Massachusetts for years during the Cape Wind saga, before that project died amid cost concerns and an onslaught of litigation. In 2016, though, the Legislature got serious, passing a law requiring utilities to bid for up to 1,600 megawatts of offshore wind power. Several of Europe’s biggest offshore players set up offices here as they pursued projects on the East Coast.

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Soon, other states wanted a piece of the action: Rhode Island, Connecticut, New York, New Jersey, Maryland, Virginia. The arms race had begun.

Vineyard Wind was to be the first major offshore wind farm in the country, financed through bids under the 2016 clean energy law. The 800-megawatt project was once expected to start sending juice into the grid as soon as this year. So much for that idea. Construction hasn’t even begun. The federal review ground to a halt under the Trump administration, amid concerns from commercial fishermen. Vineyard Wind’s developers recently withdrew their federal application, ostensibly to redo the project with larger turbines from General Electric. They are now shooting for a plug-in date in 2023, but even that could be tough if they don’t start building soon.

Several other wind farms were also stuck in permitting quagmires under Trump. But a new era is dawning under President Biden, whose administration is expected to expedite offshore wind reviews. Biden is eager to push renewable electricity, in part to curb carbon emissions and global warming, ambitiously targeting a carbon-free electric grid by 2035. And Congress just approved a 30 percent tax credit for the industry in the most recent stimulus package.

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So which state will be best positioned to ride these tailwinds?

Representative Patricia Haddad, a driving force for the industry at the State House, worries it won’t be Massachusetts. The Somerset Democrat said utilities and the Baker administration are resisting her efforts to make the economic benefits a bigger priority in decisions about offshore wind contracts. Those benefits, she said, have taken a back seat to lower prices. One challenge she faces: The 2016 law has a price cap that requires each succeeding round in wind-power auctions to be less expensive than the one before.

Vineyard Wind’s price surprised just about everyone by coming in at roughly one-third the cost of what Cape Wind’s electricity would have been. The Legislature temporarily waived the cap for round two, but winner Mayflower Wind still managed to outdo Vineyard Wind. Notably, Mayflower’s low-cost bid was selected over another proposal the developer submitted that was slightly more expensive, but included a new manufacturing facility in the state.

Haddad recalls a meeting with a top executive at Marmen, a Canadian wind tower manufacturer, here to discuss a possible expansion. He seemed intrigued, she said. But Marmen has since decided to expand at the Albany port and add hundreds of jobs there with manufacturing partner Welcon — as part of New York’s Equinor contracts.

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Baker administration spokesman Craig Gilvarg said the Vineyard and Mayflower bids set low-price records in the United States and noted that a 2018 law gives the state the authority to procure another 1,600 megawatts of offshore wind. (The climate bill Baker vetoed included 2,400 megawatts on top of that.) Despite the emphasis on providing cost-effective power to ratepayers, Gilvarg said the Vineyard and Mayflower projects will still together provide at least $107 million in direct economic development investments.

Eric Hines, an offshore wind expert at Tufts University, said it was inevitable New York would eventually use more wind power than Massachusetts, given that nearly three times as many people live there. He points to several big local selling points, including significant public investments in the New Bedford port and a blade-testing center in Charlestown.

But Hines said he also wonders if we are making the most of our 20-year head start. He’s not the only one who is wondering.



Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.