Statoil's departure leaves Maine with one offshore contender
Courtesy Cianbro
The UMaine-led consortium working on a floating offshore wind turbine design, called VolturnUS, is alone in competing for a federal development grant after the Norwegian company Statoil stepped away from its Maine-based pilot project.
Paul Williamson, director of the Maine Ocean & Wind Industry Initiative, is reluctant to characterize Statoil’s decision to scrap its $120 million offshore wind project as a lucky break for the competing Maine Aqua Ventus 1 project, led by the University of Maine and a consortium of companies that includes Cianbro and Emera.
As promising as the $93.2 million Aqua Ventus project might be, he says, Statoil’s Hywind Maine project also had significant merit as an investment by the world’s third-largest energy company to further evaluate technology it was using in the world's first full-scale floating wind turbine located 6.2 miles off the coast of Norway.
“We don’t often get opportunities like this,” Williamson says. “Twice as much investment in offshore wind [in the Gulf of Maine] is twice as good.”
Williamson, who is attending the American Wind Energy Association’s offshore wind power conference in Rhode Island this week, says Statoil’s departure from the Gulf of Maine elevates even more the importance of the U.S. Department of Energy’s next round of offshore wind grants in 2014.
In the first round, projects put forward by Statoil and UMaine garnered two of the DOE’s seven $4 million awards. In the next round, only three $47 million grants will be awarded over four years to advance the follow-on design, fabrication and deployment phases to achieve commercial operation by 2017. Maine now has one chance, instead of two, to be among the DOE’s offshore winners.
“For better or worse, it was the competition for federal dollars that eventually drove a wedge between Aqua Ventus and Statoil,” Williamson says regarding UMaine’s dual involvement as a research partner in both projects. “They tried to keep the relationship going, but in the face of competition that became increasingly difficult.”
Ola Morten Aanestad, Statoil’s vice president of communications for North America, did not return a call seeking comment. But in an Oct. 15 statement explaining the decision to scuttle its Maine project, Statoil cited “changes in the framework conditions in the state, uncertainty around the commercial framework and schedule implications of project delays [as making] the project outlook too uncertain to proceed.”
Patrick Woodcock, director of the Governor’s Energy Office, says it’s “disingenuous” for Statoil to pin its reasons for abandoning the Hywind Maine project largely on the state’s decision to reopen the Maine Public Utilities Commission’s bidding process for a long-term offshore wind power contract. UMaine submitted its bid on Aug. 30, setting the stage for a side-by-side comparison of its pilot project’s ratepayer terms against Statoil's already approved $200 million, 20-year term sheet.
“Effectively, they are moving forward with a vastly different project in Scotland,” he says, noting that Statoil’s plans there call for 6-megawatt offshore turbines (the same size proposed by the Maine Aqua Ventus 1 project) instead of the 3-megawatt units it was planning to use in its Hywind Maine project. Worldwide, he says, the offshore wind industry is moving toward larger turbines.
“So there are a lot of factors here that obviously led to this decision,” he says.
Woodcock says his preference would have been for Statoil to stick with its Hywind Maine project, and allow its merits to be evaluated by the PUC against the Maine Aqua Ventus 1 project. The PUC is scheduled to evaluate the Aqua Ventus project’s ratepayer term sheet before the year’s end.
“I think the way to build any industry is through competition,” he says. “A comparison between the two projects would have allowed a healthy discussion of what makes sense, given a finite amount of ratepayer support that’s available.”
Woodcock says Gov. Paul LePage’s well-publicized opposition to Statoil’s term sheet was based on its higher-than-market rate kilowatt-hour price and insufficient documentation demonstrating “tangible supply chain benefits here in Maine.” While it remains to be seen what Maine Aqua Ventus 1 is seeking for ratepayer support, he says its innovative use of concrete and advanced composites in its floating platform, its larger turbine size and the significant group of Maine companies that are partners in the project should be pluses in the next round of DOE funding.
“One of the factors DOE will be looking at is its benefits to the U.S. and local economy,” he says. “Another big factor is how innovative the technology is, how disruptive it is [in terms of displacing earlier technology or approaches]. The university is very encouraged by the metrics DOE will be using. They see their project as scoring very well.”
The stakes are clearly high. In a Huffington Post commentary posted online Monday, co-author Val Stori contrasts Japan’s rapid and heavy investment in offshore wind since the Fukushima nuclear meltdown with a pointed comparison to Maine.
“Maine may have laudable goals, but they lack teeth,” writes Stori, project director of Clean Energy States Alliance. “Other countries are taking offshore wind development far more seriously than the U.S. It’s not too late, but the U.S needs to up its game to see offshore wind as a scalable, commercial sector.”
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