Next Step for Offshore Wind

Alstom wind turbine like that contemplated for installation off Virginia Beach.

Alstom wind turbine like that contemplated for installation off Virginia Beach.

Earlier this year Dominion Virginia Power received a bid for building two experimental offshore wind turbines that exceeded internal cost projections by more than half, making the proposed project unlikely to win State Corporation Commission approval. In a July stakeholder meeting, DVP executives laid out their analysis of what went wrong. Now stakeholders will convene in three “problem solving cohorts” to determine how to bring down the cost of the project.

According to Nancy Lowe, with the Virginia Center for Consensus Building, which Dominion has engaged to lead the process, the groups will be broken down as follows:

  1. “Contract process and logistics – horizontal vs. vertical contracting, how to cut costs and balance risk through implementation and execution strategies, including multiple contracts versus a single contract, etc.
  2. Technology – focus on  balancing the cost issue with the amount of innovative technology to be developed and explore other technology issues.
  3. Policy Issues – determine the laws or regulations that could be changed to improve the chances of success. Determine the likelihood of being successful in achieving the modification noted, identify and quantify benefits to Virginia ratepayers.”

The stakeholders will not address the issue of cost sharing. Finding other groups to help shoulder the cost of funding the project, which would demonstrate the efficacy of new technologies benefiting the wind power industry broadly, would best be pursued by “the facilitator,” i.e. DVP, wrote Lowe in a communication to stakeholders.

Among the critical technologies to be demonstrated in this proposed pilot test are adaptations to the kind of hurricane-force winds that turbines are likely to encounter in the Atlantic Ocean. Without that technology, investing billions of dollars in an offshore wind farm might be too risky to win regulatory approval.

— JAB

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23 responses to “Next Step for Offshore Wind

  1. Thanks for the update, sounds reasonable.
    The picture is interesting I wonder if that is really what the base looks like. I thought the problem with that type of base was birds like to build nests in there. Then the birds have to be careful to avoid the blades. But I am not the expert.

  2. re: “the birds” – not to minimize the issue – but to put it in perspective.

    1. Domestic and feral cats: 200 million
    2. Power lines, collisions and electrocutions: 25 million
    3. Collisions with houses or buildings: 25 million
    4. Vehicle collisions: 14 million
    5. Game bird hunting: 5 million
    6. Agricultural pesticides 2.7 million

    wind turbines – estimates 33,000 and up – current

    Wind Turbines Not a Threat to U.S. Bird Population, Says Study
    NRC report finds governmental guidance to help communities and developers evaluate and plan proposed wind-energy projects is lacking.

    the difference is that turbines tend to kill larger birds…

    still – more than a million deer are killed every year by vehicles.

    colors, sounds, light are being used in various combinations to warn birds away.

    but I’m still skeptical that wind is cost-effective because if it were islands around the world would be building wind turbines to reduce their fuel costs – and while there is activity – it’s not exactly transformative.

    same deal with Nukes If we can put small nukes on aircraft carriers why not island nations?

    It’s seem ridiculous in 2015 – that we still are burning fuel oil to generate electricity – but we are.

  3. Might also use this opportunity to point out something sort of related:

    Texas company holds ground breaking ceremony for natural-gas power plant in Loudoun County

    Dallas-based Panda Power Funds held a groundbreaking ceremony on Thursday for the natural gas power plant it is building in Loudoun County.

    Construction on the Stonewall project, located 4 miles southeast of Leesburg, started in March. The 778-megawatt facility is scheduled to start operating in mid-2017 [and will serve about 700,000].

    Now, there are about 2 million people in NoVa and a million in Fairfax and 350,000 in Loudoun county.

    Now Loudoun county is a LOT closer to where the Marcellus Shale is and at this point don’t know if they plan on using existing pipelines or building a new one.[

    Now – this is NOT a Dominion plant, it’s a Northern Va Electric Co-operative, one of more than a half dozen cooperatives scattered across the state, which have a lot more to do with the electric grid in Va than one might think.

    Unlike Dominion – these cooperatives are not investor-owned. They are member-owned and not-for-profit.

    How renewables like wind and solar fit into the cooperative picture is a mystery to me.

    When the EPA wants Va to develop a renewable energy portfolio – are these cooperatives part of the plan?

    • Larry, Columbia Gas Pipeline proposes to upgrade an existing pipeline from West Virginia to Northern Virginia, a project that would require acquiring only a few miles of new right of way. The WB Xpress project would add 1.3 billion cubic feet per day of natural gas transport capacity. I wasn’t aware of the Panda Power project. That explains a lot.

    • The Stonewall project developed by Panda really has nothing to do with NOVEC. Panda is an independent power producer. The electricity generated by that project will bid to sell into PJM, or else enter into a bilateral contract to sell power to a distributor (which could be NOVEC), to be delivered through the PJM managed electric transmission grid. There are several such plants in Virginia, most of which have had contracts with Dominion to purchase their output for many years.

      I believe the Stonewall plant is located on a site that currently has a gas transmission line passing through it, as well as high voltage transmission lines, so interconnection to the grid is very easy, not involving construction of new power lines in that congested part of the state.

      And in response to your last question, Larry, the EPA is setting limits on the CO2 emissions of an existing (and under construction) set of generating plants. To the extent that the coops, through their participation in ownership of ODEC, which has ownership in some generating facilties in the state, then they will have to comply with whatever plan the DEQ develops for those plants. That could, as you posit, involve displacing generation from these facilities with new renewable power.

      • Thanks.. I’m realizing how little we (myself) really know on these issues. I assumed it was located there so that NOVEC could essentially emulate ODEC in building a plant in their territory and selling the power to other cooperatives.

        so my assumption that NOVEC commissioned this plant – appears to be wrong and I can find nothing that supports that idea.

        how does PANDA know that their power will be purchased and why build it in Loudoun rather than much closer to where the shale gas is physically and feed it in to PJM there? Why not build it further west from Leesburg on the same power line right of way?

        What keeps a company – like Panda from building plants anywhere in Virginia including perhaps in Hampton Roads so that powerlines acorss the James from Surry would not be needed?

        Also – I’m sure you saw this:

        ” U.S. carbon pollution from power plants hits 27-year low

        April emissions peaked at 192 million tons in 2008 and dropped by 26 percent in seven years.

        Carbon pollution from power plants hit their peak in August 2007 with 273 million tons;

        In past years, experts said the U.S. reduction in carbon dioxide pollution was more a function of a sluggish economy, but McFarland said that’s no longer the case.

        “You don’t have a 27-year low because of an economic blip,” McFarland said. “There are more things happening than that.”
        The price of natural gas has dropped 39 percent in the past year, he said. Federal analysts predict that this year the amount of electricity from natural gas will increase 3 percent compared to last year while the power from coal will go down 10 percent.”

      • This (Panda Gas) is interesting topic (although we are supposed to be talking about wind). Maybe a separate article would be good. I support natural gas, but my concern is efficiency to produce as little CO2 as possible. Since Va. now has a mandated ceiling on CO2, the amount of natural gas we can use is limited, thus we need to try to get the most power out of our limited allotment.

        I support (on-shore) wind power too, but wildlife impact (bird migratory zones) is certainly a key design consideration that can impact site selection and design of the towers. Although the modern tower designs presumably already minimize this issue.

        • I’m guilty of hijacking threads on occasion but in this case – I thought it interesting that someone other than Dominion was building plants… in VA.. and that got me wondering about several allied issues – that do play into the whole CPP conundrum involving reduced emissions, natural gas, and renewables.

          and I again point out this headline: ” U.S. carbon pollution from power plants hits 27-year low”

          this BEFORE we even talk about more reductions…

          • Panda chose to build in Loudon because there was an excellent site available there with access to both an interstate gas pipeline with enough capacity to supply the plant with fuel AND a high voltage transmission line to take the electricity produced there and deliver it into the power grid. Both of these serve to reduce Panda’s cost of production.

            As for how Panda knows its power will be purchased, the answer is it develops those costs of production and evaluates its chances of being able to sell power on the open market into PJM or to a particular purchaser willing to pay that rate for an assured long-term supply.

            There are independent power plants throughout Virginia, most located at those gas pipeline/transmission line intersections. Panda could theoretically build a plant in Hampton Roads, but the cost of production would be higher there since gas availability is very limited, which is one reason Dominion cited for building that transmission line rather than repowering those old coal plant to run on gas.

  4. Hopefully Dominion will talk to the Norwegians who seem to be way ahead of the curve compared to much of the rest off the world. They are even planning to install a 2mw deep water floating installation this year. A quick Google search was quite enlightening.

    Norfolk invited the Dutch over to discuss land subsidence/rising seas .. perhaps it’s a model Dominion might emulate.

    • Here is an area where the US can gain from the experience of other countries, particularly the development of offshore wind in the North Sea. The problem faced not only by Dominion, but by every Atlantic facing utility is that whoever goes first will shoulder “first adopter” type costs–no one here has experience in erecting these turbines at all, let alone doing it efficiently. At some point, the cost curve will get driven down.

      Five turbines are being installed off Block Island, Rhode Island, but the transmission throw there is much, much shorter compared to the 22+ miles that Dominion would have to bring power from its offshore site.

      • I wonder how Block Island got around the typical nimby opposition to the impact to views and “bird killing” issues?

        Apparently it’s coming online in 2016…

        oh.. I see now the “appeal” and it’s not entirely straightforward:

        ” One aspect of the smaller project that supporters have touted is how much it would save electric power customers on Block Island. Besides providing wind-generated electricity to the island, the project calls for an underwater power cable that would connect it to the New England power grid.

        Currently, the island relies on its own electric company that uses diesel-powered generators to serve about 1,800 customers. Their electric rates are the highest in the state and among the highest in the country.

        Deepwater highlighted the potential savings in a Tweet the company put out Dec. 12: “Did U know? Block Island Wind Farm would mean 40% est. drop in BI electric rates.

        We [Politifact] wondered whether that figure was accurate or whether Deepwater was just blowing a lot of hot air.

        Block Island, or New Shoreham, as the island’s town is legally known, is in a unique position among Rhode Island municipalities when it comes to electric power.

        On the mainland, except for the section of Burrillville served by the Pascoag Utility District, the state’s cities and towns get their electricity from National Grid.

        On Block Island, it’s the Block Island Power Company, whose on-island generators run on diesel fuel, which must be shipped to the island by boat.

        A 2010 Providence Journal story on the island’s power system noted that diesel fuel regularly costs $1 more per gallon on the island than on the mainland.

        In fiscal 2011, according to a report by the town’s Electric Utility Task Group on the fiscal costs and benefits of the wind-farm project, the average cost of electricity on the island was 47 cents per kilowatt hour. In the rest of Rhode Island it was 14.8 cents.

        Once the cable is laid and the wind farm project is on line, in 2014 or 2015, Block Island Power will be able to purchase electricity from the New England power network at much lower costs.

        The task group estimated that electric rates on the island — based on a 20-year agreement between Deepwater Wind and National Grid — would fall to 30.7 cents per kilowatt hour, a 35.4-percent decrease from 2011 rates.

        (The island’s rates would still be substantially higher than those on the mainland because its customers would be paying for a portion of the costs for installing the cable and for maintenance of the island’s power system.)

        The task group’s analysis noted that current power costs on Block Island have risen to 54 cents per kilowatt hour because of the increasing diesel costs. Based on that figure, the decrease would be a 42-percent drop — about what Deepwater said in its Tweet.”

        • This is a good example of what has been missing from the alternative energy industry – renewable energy that saves consumers money. While this is somewhat of a unique situation because of the extremely high costs for fossil-fuel-generated power, it’s the type of approach needed.

          Lately, entertainment stocks have been tumbling some because of the rise of streaming video that allows consumers more selection of what they want to watch, rather than what has been bundled together. Clearly, new “entertainment companies,” such as Netflix and Amazon, are disrupting the market. Where is the distrupter to Dominion or Washington Gas or NOVEC? The goal should be to capture those customers who don’t believe in or don’t worry about whatever euphemism we have for climate change/global warming because power from renewable sources is cheaper and/or more reliable.

  5. Larry Re: Bird Count – 33000 and up? Closer to way “up” I am thinking. But I am simply pointing out that design of the structure can minimize the issue.

  6. As a former electrical engineer for a major manufacturer of switchgear/underground cable/transmission equipment I can attest that laying, maintaining, protecting a ~20 mile high voltage cable off the coast of Virginia Beach is not a trivial exercise. Dominion (VEPCO as it was known) was my customer in those days. We even thought 132KV was high voltage some years ago … my how things have changed.

    I would hope Virginia Beach would not give Dominion the same type of grief over the transmission line and switching station that James City County is doing now. The clock may be ticking for reliable, no-rolling-blackout power for the Peninsula.

    Emissions from fuels are unfortunately not the only issues Dominion has to deal with. On balance I think they are a great utility. Thank goodness I don’t get my power from BPA, Commonwealth Edison, or ConEd.

  7. I’d just like to say that this post and the comments are why this blog is a treasure to the Commonwealth. I’ve learned so much reading this.

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