Governor Charlie Baker on Wednesday launched a plan to make Massachusetts more competitive in the fast-growing offshore wind industry amid the increasingly crowded race to attract jobs and investments along the East Coast.
He filed legislation that would eliminate a price cap that may have discouraged bids in the state’s latest contest for offshore wind contracts. It would also give state officials — not electric utilities National Grid and Eversource — decision-making power over who wins them, to avoid potential conflicts of interest. The policy changes in the bill would take effect for future bidding rounds, not the current one.
Baker’s bill also asks the state Legislature to set aside $750 million in federal stimulus funds to help support offshore wind projects and other clean-energy businesses, on top of $100 million he’s already seeking to bolster port infrastructure primarily to help the wind industry.
“We’re sending a clear signal ... that now is the time to be investing in offshore wind,” Baker told the crowd at an industry conference at the Omni Boston Hotel on Wednesday. “The legislation is designed to reinforce the Commonwealth’s clean-energy economy and to set the path forward for what we can achieve together with the right plan and the right investment.”
At the same conference Wednesday, hosted by the American Clean Power trade group, US Interior Secretary Deb Haaland unveiled plans to hold up to seven more offshore lease sales for wind farms by 2025, including in the Gulf of Maine, the Gulf of Mexico, three other East Coast locations, and two West Coast areas. The Biden Administration has pledged to add 30,000 megawatts of offshore wind production by 2030, as part of a broader plan to sharply reduce fossil fuel emissions.
Left unsaid by Baker: As the industry grows, Massachusetts is at risk of falling behind rival East Coast states such as New York in the race for offshore wind energy jobs and infrastructure.
Massachusetts was the first state to seek bids to build offshore wind farms, a process set in motion by a 2016 clean-energy law. But several other states have launched projects of their own, and in certain cases have drawn much bigger local economic development commitments than what has been promised in Massachusetts.
Many in the industry here point to a cap in that 2016 law that requires each successive winning bid to provide power at lower prices than the previous winning bid. The Vineyard Wind and Mayflower Wind consortiums have each won utility contracts to build wind farms south of Martha’s Vineyard that would generate about 800 megawatts apiece, each with enough electricity to power more than 400,000 homes. Now, the state and the utilities are weighing bids from those two groups in a third round. But two other potential bidders with offshore lease rights opted not to participate in this round.
House Speaker Ron Mariano worries the price cap may have kept bidders at bay, and has pledged to revisit the issue this fall. Now Baker is proposing to remove the state’s cap.
However, there may be support in the Senate to keep it. Senator Mike Barrett, cochair of the Legislature’s energy committee, expressed concerns that ending the cap might affect electricity prices, making it harder to wean consumers off natural gas and oil heat in favor of electric-powered heat pumps. He also worries that higher electricity rates could slow the adoption of electric cars.
“Legislators are being asked to terminate protection for the people who pay their electric bills every month, which is most of us,” Barrett said in a statement. “For the Administration, this is a major policy change. The Legislature should approach it with a critical eye.”
Industry players and some environmental advocates praised Baker’s move.
Mayflower chief executive Michael Brown said his group is “open to refinements of the procurement process” that build on the state’s record of success. The Environmental League of Massachusetts said offshore wind is the state’s “single biggest lever” to reduce carbon emissions and grow the economy. And the Northeast Clean Energy Council said the proposed policy changes help ensure offshore wind would remain at the core of the state’s clean-energy policies.