A Nov. 21 letter from Kris Ohleth, director of the Special Initiative on Offshore Wind, contains misleading information.
She states electric prices for offshore wind will be locked in for decades. Onshore wind and solar project costs are spent upfront, and these projects typically have a fixed electric supply contract price for decades. However, offshore wind projects, with most of the cost also upfront, get an annual 2% price increase. For example, the Maryland Public Service Commission in Docket 9666 approved the US Wind 808 MW Momentum Wind project. The project starts out with a guaranteed electric customer payment of about 7.7 cents per kWh, but rises to 11.5 cents over 20 years.
The official estimated direct economic benefits used to approve the Momentum Wind project are given in Docket 9666, Item 32, pages 63-64 as $741 million with 3,944 full-time equivalent temporary construction jobs and 68 permanent operations and maintenance jobs. Since the turbines are made in Europe, and will be shipped and installed by European crews, many of the construction jobs may go to foreigners.
Economic benefits need to be compared to the primary economic costs that include the premium electricity costs from subsidies paid by electric customers, a 30% federal investment tax credit paid by taxpayers, and possible lost beach tourism. Higher electric prices will have a negative economic impact of $2.5 billion in current dollars (2,513,752 megawatt-hours/year times the approved annual price with a 7% discount factor). The tax credit may total close to $1 billion (a Virginia project states a construction cost of $4 million/MW suggesting $3.2 billion Momentum Wind cost times 30% ITC).
Our beach economy may suffer. Ohleth claims such impacts will be minuscule based on a University of Delaware study. That study showed visualizations of 579-foot-tall wind turbines, but the US Wind Construction & Operation Plan indicates turbines 938 feet to 1,050 feet tall will be used. Correcting for the taller turbines suggests up to 15% of visitors will not return, which could cut $300 million a year from our $2 billion a year tourist economy.
Total economic cost may reach $3.8 billion, five times the benefits.
The UD study showed nighttime visualizations, but the survey data was not released. An NC State survey of recent beach renters, “The Amenity Costs of Offshore Wind Farms: Evidence from a Choice Experiment,” showed 38% of renters would not return if there were daytime views of wind turbines, but 54% would not return because of more-disturbing nighttime views.
US Wind is misquoted as planning to use Aircraft Detection Lighting Systems, which only turn on the lights when aircraft are present to mitigate night time views. What US Wind actually states on page 23 of Volume 2 of its COP is it will use the system if “commercially feasible.” US Wind does not define the terms or conditions of what would make the systems commercially feasible. Without a solid commitment to using ADLS, we should assume the system will not be used.
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