Friday 9 November 2018

Governor Andrew M. Cuomo has issued a comprehensive solicitation seeking 800 megawatts or more of new offshore wind projects for New York. This highly anticipated first offering, issued by the New York State Energy Research and Development Authority kicks-off competition for New York State's first large-scale offshore wind development contracts, an initial step toward its goal of 2,400 megawatts of offshore wind by 2030 to combat climate change. The solicitation accelerates New York's progress towards Governor Cuomo's mandate for 50 percent of the state's electricity to come from renewable sources by 2030 and significantly jump starts the emerging offshore wind industry in New York.

This historic offering marks an important new chapter in New York's nation-leading offshore wind planning efforts, which have been conducted over three years and have included extensive stakeholder, agency, and public consultation along with detailed technical and financial analysis. These planning efforts provided the basis for New York's Offshore Wind Master Plan, released in January of 2018, and the Public Service Commission's July 2018 Order Establishing the State's Offshore Wind Standard, which established the foundation for this important step forward.

A rapidly growing state-of-the-art global industry, offshore wind is expected to bring an estimated $6 billion of investments to New York that will support approximately 5,000 highly-skilled new jobs in manufacturing, installation and operation of offshore wind facilities and nearly 2,000 jobs in long-term operations and maintenance. The NYSERDA solicitation includes first-of-a-kind requirements for wage and labor agreements by offshore wind developers to ensure that the projects deliver high-quality jobs for New York workers.

To facilitate the ability of New York businesses to participate in the delivery of these projects, NYSERDA will host the New York Offshore Wind Supplier Forum on November 15, 2018 in New York City to connect local suppliers and service providers to global offshore wind developers and manufacturers. More information on the Forum is available here.

Under the solicitation, NYSERDA has the ability to award 25-year long-term contracts for projects ranging from approximately 200 megawatts to approximately 800 megawatts, with an ability to award larger quantities if sufficiently attractive proposals are received. Each proposer is also required to submit at least one proposal of approximately 400 megawatts. Bids are due in February 2019, and awards are expected in Spring of 2019 and contracts are expected to be executed thereafter to take advantage of expiring federal tax credits.

Other notable provisions in this comprehensive solicitation include:

- Ensuring that coastal communities are fully engaged and informed during the development and construction process;

- Requiring Project Labor Agreements and prevailing wage for workers associated with the construction of any awarded facility;

- Incentivizing associated jobs, project spending, and infrastructure investments in New York State by requiring awardees to provide an economic benefits plan for evaluation, backed by independent audit and verification of the realization of these claims; and

- Actively addressing the interests of ocean users such as commercial and recreational fishing and environmental stakeholders as reflected in mitigation plans which are informed by New York's technical working groups.

Under the New York State Public Service Commission's July 2018 Order, which adopted New York's 2,400-megawatt goal and set the framework for the first phase of solicitations, NYSERDA will award proposals according to both the price offered by the proposer as well as economic benefits and project viability. Through these solicitations, NYSERDA will procure Offshore Wind Renewable Energy Certificates, ORECs, from awarded facilities.

As the cost of offshore wind has declined significantly over the last decade in Europe and around the world, New York is leading the nation's efforts to bring this renewable technology to the Atlantic coast of the U.S. In June, NYSERDA was awarded $18.5 million in funding by the U.S. Department of Energy to lead a nationwide Research and Development Consortium to advance offshore wind nationally. Industry, academia, and national laboratories will support Consortium initiatives to reduce cost and risk of offshore wind development projects throughout the U.S. while supporting U.S.-based manufacturing and the offshore wind supply chain. The Consortium strengthens New York's leadership role in advancing the cost effective and responsible development of offshore wind.