Consider Manhattan Contrarian as your go-to source for the latest on New York’s progress toward green energy utopia.
Can you remember all the way back to December 19, 2022? That’s the day that New York’s Climate Action Council officially adopted its “Scoping Plan,” telling us all how we are going to achieve, among other goals, 70% of statewide electricity from renewable energy sources by 2030 and a zero-emissions electricity system by 2040. The biggest part of the grand plan consists of some 9,000 MW (nameplate capacity) of offshore wind turbines to be built by 2035. As of the time of the Scoping Plan, the state claimed that some 4,300 MW out of the 9,000 MW of upcoming offshore wind projects were under “active development.”
On the very day that the Scoping Plan got finalized, I had a post titled “On To The Great Future Of Offshore Wind Power.” That post noted that even of the 4.300 MW of offshore wind supposedly under “active development,” not one turbine was operating, or even under construction. Several developers had made bids that had been accepted by the state, and some of those developers were getting kind of close to applying for permits. My prediction was: “Expect long delays and demands for lots more money before anything gets built.” Boy, can I call these things.
Shall we check back in for the latest information?
Just ten days ago, on October 5, I had an update on offshore wind developments throughout the Mid-Atlantic and New England. For New York, the news was that in September essentially all the developers of the New York projects in “active development” had demanded massive price increases, ranging from about 30% at the low end to almost 65% at the high end. The new prices being demanded by the developers would now be between $140-190 per MWh, which would be at least double to more than triple the prices charged by new natural gas plants.
So how did that go over? To its credit, the state Public Service Commission wasted no time in rejecting the price hike demands of the developers. On October 12 the Commission issued its decision on the Petitions of the developers for price relief. Excerpt from the press release:
The New York State Public Service Commission (Commission) today denied petitions filed by a group of offshore wind developers and a state renewable energy trade association seeking billions of dollars in additional funding from consumers for four proposed offshore wind projects and 86 land-based renewable projects. In denying financial relief, the Commission opted to preserve the robust competitive bidding process that provides critically needed renewable energy resources to New York in the fairest and most cost-effective manner that protects consumers.
OK then, what happens next? The New York Times has a write-up here on October 12. The Times quotes the Chair of the PSC, one Rory Christian, as standing up for the sanctity of the public bidding process:
Rory Christian, the chairman of the Public Service Commission, the state’s utility regulator, said that providing relief to the winning bidders would set an untenable precedent. “Taking exception today almost guarantees that we will be asked to do this again in the future,” he said. Mr. Christian added that the state’s ratepayers, who would have borne the cost, could not serve as an “unlimited piggy bank” for companies to tap. “We have a deal,” he said to the developers, calling on them to stand by the terms they agreed to.
Well, Rory, I’ve got news for you: the developers aren’t going to honor the deal. You’re going to have to hold a new auction. And the prices that will be bid will be as high or higher than those just demanded by these developers.
Oh, and then don’t expect any new round of accepted bids to stick either. The developers will come back again and again for new rounds of price increases. What’s to stop them? After all, they have you over a barrel. You have a “Climate Act” and a “Scoping Plan” that basically require you to build out a grid powered by “renewables,” whether that is feasible or not, and then limit your options to mostly offshore wind.
And meanwhile, until the next round of bids is held, we’re back to square one. We have a statutory requirement of 70% of our electricity from “renewables” by 2030, and a “Scoping Plan” that sees that goal being achieved largely through offshore wind turbines. And we have not one single operating offshore wind turbine, nor any under construction, nor, after the recent contract repudiations, any actively moving through the permitting process. At least for now, the whole thing is dead in the water.
The Times quotes a guy named Fred Zalcman, director of the New York Offshore Wind Alliance:
[T]he commission’s decision “puts these projects in serious jeopardy and deals a potentially fatal blow to the progress these projects have made. . . .”
By the way, the prices recently demanded by the offshore wind developers, in the range of $140-190/MWh, do not include anything for the transmission upgrades needed to deliver this power into the grid, nor anything for the storage or back-up needed to transform intermittent wind power into a useful 24/7 resource. The sooner we pull the plug on this whole endeavor, the better. But we are now only in the first phases of the collapse.
UPDATE, October 16, 2023: Meanwhile, I should have mentioned that New York City apartment buildings remain under a mandate from “Local Law 97” to convert to electric heat by 2030 or face large fines. The electricity is supposed to come from the offshore wind farms that, for the time being, are completely suspended. Go to the link in the sidebar to listen to Jane’s podcast on this subject.
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