by Adam Siegel
Dominion Energy appears to be finally on track – we hope – for a small offshore wind project to start generating electrons. At over $300M for a small, 12-megawatt “demonstration” project, this has to be in serious competition for the most expensive wind farm under development on the planet today. And amazingly, while offshore wind development is racing ahead in other countries and states, here in Virginia, this tiny project has been in various forms of planning and discussion for around a decade now. Now, if all goes according to plan, the Coastal Virginia Offshore Wind project will be up and running by late summer 2020.
There are many who seem to want to pat themselves on the back for this, as if it somehow will “keep Virginia #1 on climate” (as Governor McAuliffe phrased it a few years ago). Wow – so exciting that Virginia will have two – count ’em – offshore wind turbines. Also exciting that Dominion has seen fit to include offshore wind in its public plans. So, YEAH …at least there’s some movement, albeit far too slow and cautious.
In other words, that is a YEAH with a lot of caveats.
For starters, while this two-turbine “test” project might have made sense a decade ago — with great uncertainty about long-term prospects for offshore wind energy, high costs for generated electrons from a rather small set of projects, and an essentially non-existent US offshore wind industry — things have changed significantly in recent years, and certainly since Dominion competed back in 2013 for Department of Energy funding for an offshore wind energy project.
Recent news from France should make clear how much things have changed…in favor of offshore wind power’s economics. Just announced is a 600-megawatt project that will deliver electrons at Euro 44 per megawatt hour … or under $US50 per MWh (under 5 cents per kilowatt hour). This is truly impressive: clean, inexhaustible offshore wind power at a lower cost than any fossil fuel (or nuclear power) option for new electric generation capacity. The French government has responded to this low pricing by doing an assessment of their future plans. That assessment that has led to rapid change: upping the planned installments of offshore wind to 1GW per year (around 80 times more, each year, than Dominion’s tiny 12-megawatt demonstration project).
The low, low pricing isn’t the only stunning thing. It is the speed planned for the project. With the project award just announced in mid-2019, the electrons are set to begin flowing in 2022. That’s just three years from award to operations – much faster than building a new nuclear power plant, natural gas power plant, etc.
In stark contrast, Dominion is about a decade into a project for two measly offshore wind turbines. A project that will likely deliver electrons at (it appears) over 25 cents per kilowatt hour — five times the cost of the French project! A project that many have seen for years as purposefully structured so that Dominion can try to hoodwink our (captured) Virginia politicians and regulators into thinking that offshore wind is too expensive and not viable? Why? Clearly, so that Dominion can, instead, build more polluting natural gas plants, paid for by captured customers, with guaranteed profits that will burn fracked gas from Dominion-owned production transported via Dominion-owned pipelines. Can we say “self dealing?” Also “profits, profits, and more profits” — from a far more polluting, and expensive, energy generation option. Truly, when regulatory capture is discussed, Dominion and Virginia should be example #1.
France is showing us, if we bother to pay attention, that things can be much, much different, and much, much better. Low-cost and clean electrons generated near population centers, industries and manufacturing means, among other things, JOBS! JOBS! JOBS! Instead of kowtowing to Dominion, Virginia political decision-makers, regulators, and utilities should be paying attention to rapid technological and business case advances in power generation technologies – and changing, in real time, their policies and plans leveraging those advances.
A simple question:
Can Virginia politicians/policymakers move even half as fast, half as effectively as French bureaucrats?
Also keep in mind that, while Dominion dilly-dallies with its pathetically small 12-megawatt project, other states are racing ahead with multi-gigawatt plans. And, associated with those plans, those states are looking at thousands, probably tens of thousands, of high-paying jobs going to ports and communities that are in their states – NOT in Virginia. This, despite the fact that Virginia’s Hampton Roads region is, simply stated, the best region to support an East Coast offshore wind industry: great geography, abundant wind power resources (enough to power the entire state), with major shipbuilding and other infrastructure. But to get a share of those lucrative industries and those high-paying jobs, Virginia must have a serious offshore wind program. While Dominion’s recent announcements that it is seeking to have gigawatts in operation or under development by 2022 does suggest that even Dominion has recognized the absurdity of its denial of renewable energy options, a mere 12MW, with tentative plans for “more to come,” simply isn’t serious. At all.
At this point, we need an intervention. For starters, Governor Northam should announce a rapid study team (building on the work already done, such as the Virginia Offshore Wind Development Authority, the developed Roadmap, activist assessments of offshore wind, etc.) to assess international and domestic offshore wind programs and advances, and their implications for the Commonwealth. This team should focus on what Virginia can – and must – do to become “#1 on offshore wind” in the United States for job creation through clean electrons and climate action. This team should both educate (citizens, politicians, regulators, business leaders) and provide tangible material for action in the 2020 legislative session. And, then the Virginia’s (newly-elected, Democratic Party majority) legislators should act.
Moving with alacrity to “make Virginia #1 on offshore wind” could be a core element of a “Virginia Green New Deal,” as it would tangibly lower pollution while creating:
- low-cost, reliable, home grown, clean electrons to power Virginians’ homes and businesses (and, increasingly, transportation);
- industrial policy leveraging existing Virginia advantages for seizing leading positions in adjacent emergent markets;
- Significant numbers of high-quality/high-paying jobs (blue and white collar)
What are we waiting for? And more to the point, why on earth are we allowing one ostensibly state-regulated monopoly utility, Dominion Energy, to continue blocking progress for 8 million Virginians?
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