LePage administration questions feasibility of offshore wind power 

ORONO, Maine – A $20 billion offshore wind project proposed for the Gulf of Maine that was supported by former Gov. John Baldacci is being viewed with skepticism by the administration of Gov. Paul LePage.

Habib Dagher, director of the Advanced Structure and Wood Composites Center at the University of Maine, and his partners at the DeepCwind Consortium say that electricity produced in the gulf by deep-water offshore wind turbines will reduce the state’s dependence on foreign oil.

“To really make a difference in the state of Maine, you need to reduce your heating costs and your transportation costs,” said Dagher. “This is where offshore wind can help us because we can reduce heating costs by using the electricity generated in the Gulf of Maine to heat our homes and power the electric vehicles of the future.”

But two advisers to LePage with knowledge of the energy industry question the consortium’s assumption that the state’s dependence on foreign oil will be reduced by creating wind-generated electricity to power electric cars and heat Maine homes.

Support for the project by the administration is important because it is to be funded through a combination of investments from the private sector and state and federal subsidies in the form of tax breaks and government funding.

Ken Fletcher, director of the Governor’s Office of Energy Independence and Security, said that initially the price of electricity from offshore wind would be very high. He estimated it would cost about 27 cents a kilowatt-hour. The average price for electricity in Maine is now about 16 cents a kilowatt-hour.

Fletcher said although costs would come down as the technology is developed, it is unclear how long it will take to reach the point of affordability.

“The LePage administration has taken the point of view that we cannot pass these costs onto Maine ratepayers, and this is going to be the main challenge,” said Fletcher. “We haven’t signed [on] the dotted line yet.”

James LaBrecque, owner of Flexware Control Technology in Bangor and an energy policy adviser to LePage, said technologies such as offshore wind and solar power are not viable because of their high cost and low performance rates.

“The dismal performance of alternative energy systems is limited by nature and not technology,” LaBrecque said. “In other words, when the wind stops blowing and the sun stops shining, you’re dead in the water, no matter what the technology or how much gold plating you cover it with.”

“In my 40 years in the energy arena, I have learned two things: There are no silver bullets, and we’re almost out of blanks,” added LaBrecque, who also works as an mechanical engineering adviser at UMaine.

“This offshore wind project has become a bit of a sacred cow on campus and throughout the state. Those who are skeptical won’t speak out against it for fear of being blackballed,” LaBrecque said. “You ask anyone in the engineering department at UMaine and they will tell you that there are a number of things that don’t add up in the overall plan.”

Flexware Control Technology designs and develops process control technology for the refrigeration, air conditioning and heat pump industries. Whether the offshore wind project comes to fruition or not, “it would not have any impact on me whatsover,” LaBrecque said.

Attempts to reach others at UMaine with knowledge of the offshore wind project were unsuccessful, but at least one member of the engineering department previously expressed support for the effort. Dana Humphrey, dean of the engineering department, has said it is important for the university to continue exploring renewable energy technologies because they have the potential to greatly benefit society.

The project is massive in size and scope, and billions of dollars would be needed to build and develop the technology for it. But if offshore wind power becomes a reality in Maine, the payoff, proponents say, could be immense.

At a conference three years ago in Northport, state officials and energy company representatives said offshore wind and tidal energy represent a vast, untapped resource for renewable energy in Maine.

A representative with the federal National Renewable Energy Laboratory estimated that Maine’s deep coastal waters have the potential to generate 133 gigawatts – or 133,000 megawatts – of wind energy. By comparison, New England’s largest wind farm, TransCanada’s Kibby Mountain facility in the mountains of western Maine, can generate a maximum of 132 megawatts of power when all 44 turbines are operating at full capacity.

One of the key advantages to offshore wind power facilities cited by proponents is that unlike on the land, the wind rarely stops blowing in the Gulf of Maine and often blows much stronger. The turbines envisioned for Maine’s coastal waters also would be significantly larger and, therefore generate more electricity than turbines built on land. Those factors – combined with the lack of scenic impacts faced by mountaintop wind turbines – would make offshore wind projects much more reliable and attractive than wind farms on land, according to supporters.

Generating more electricity is actually not the key issue, Dagher said. New England generates a surplus of electricity, according to figures from ISO New England, the organization that oversees the electric grid in New England. The benefit of the wind project would be to cut into oil prices and the economic problems they pose for Maine – and the nation – in the future.

LaBrecque counters that tapping into the power grid in order to deliver enough electricity to reduce heating costs would be a costly and challenging effort. He also said it is unclear how offshore wind-generated electricity would be delivered to all the homes in Maine.

But proponents of the project are convinced that as the supply of fossil fuels decreases and the cost increases, the state will need new forms of renewable energy.

States including Massachusetts and Connecticut have established Renewable Portfolio Standards, which are policies designed to increase generation of electricity from renewable resources. Maine has a similar law, but LePage, in an effort to lower energy costs, recently introduced legislation to end requirements that power companies derive 10 percent of their power from renewable sources by 2017. Last week a legislative committee voted not to take action on the bill this year.

Another argument for the project put forward by proponents is the 7,000 to 15,000 jobs that could be created in Maine as a result of the design, manufacture, maintenance and transportation of turbines, which at 500 feet tall would be taller than the Washington Monument.

A bold plan

The deep-water offshore wind project would be the largest construction undertaking in Maine’s history, according to Dagher. It also would be the first of its kind in the United States, as the turbines expected to generate electricity would float 20 to 50 miles offshore in water at lease 300 feet deep.

The project consists of five phases and would cost about $20 billion to complete. Three of the five phases are considered crucial.

In the first crucial phase, a floating wind turbine prototype, built to one-third scale of the final product, will be deployed off Monhegan Island in 2012.

The second and perhaps most important phase, said Dagher, is considered to be a test phase. It calls for a floating “steppingstone” wind farm – with five turbines that each produce 5 megawatts of electricity – to be tested between 2014 and 2017 in cooperation with a private developer to be selected by the Maine Public Utilities Commission in the coming months.

And the final phase, referred to by Dagher as the “end goal,” will be to complete a network of 1,000 floating offshore wind turbines that produce 5 gigawatts of electricity by 2030. Currently, it takes 2.4 gigawatts to power Maine.

Government help with funding will be critical to the project coming to fruition, according to a financial analyst.

“What investors are often requiring – because the payback takes so long – is that the governments pursuing these projects subsidize them,” said Joshua Hayward, a financial consultant with the Baldacci Consulting Group in Portland, owned by former Gov. John Baldacci’s brother Robert Baldacci. “This often creates a lack of public support, but as long as subsidies are in place, investors will play ball.”

Dagher says the offshore wind project has received a “vast amount” of public support in the form of an $11 million bond that was passed by voters in June 2010 to help fund research for the technology in addition to “near unanimous” support from the Maine Legislature.

“There has been overwhelming support for offshore wind, which gives us, if you wish, a mandate to make this work,” said Dagher. “It’s about putting a plan together and making it work.”

Such a plan was released by UMaine in February. The Maine Deepwater Offshore Wind Report was compiled for private developers interested in a long-term offshore wind contract with Maine and examined the feasibility of developing the 25-megawatt floating offshore wind farm.

In September 2010, the PUC, at the direction of the Legislature, issued a request for proposals from developers interested in signing a contract to develop a commercial offshore wind farm. The deadline was May 2, and according to PUC spokeswoman Evelyn deFrees, the agency received a number of proposals. She said Tuesday that the PUC staff is analyzing the proposals with an eye toward their financial arrangements, technology and economic benefits for Maine, and that a deadline has not been set for a decision.

A contract with the PUC eventually would require any potential developer to expand the “steppingstone” 25-megawatt wind farm into a wind farm in the Gulf of Maine with the capacity to “provide electric consumers in Maine with project generated power at reduced rates,” said the offshore wind report.

This could pose a significant challenge to any developer because the technology has not been developed sufficiently to provide reduced rates, according to industry experts, including Fletcher.

At a State House event in May 2010, Baldacci joined state lawmakers and advocates for renewable energy to celebrate the passage of a suite of bills aimed at helping lessen Maine’s dependence on foreign oil and other fossil fuels. Among the bills was a measure to establish a permitting process for offshore wind farms.

Asked about the offshore wind project on Tuesday, Adrienne Bennett, spokeswoman for LePage, referred comment on the issue to Fletcher, who is the administration’s top energy policy adviser.

What many question is how offshore wind power will reduce Maine’s dependence on foreign oil and make a dent in the high energy consumption rates in Maine and across the country.

Some maintain that the answer to that question would involve an expensive conversion of all of Maine’s homes that heat with oil to systems that heat with electricity. They also point to the time it would take to reverse national policies that have offered billions in subsidies to the oil industry and have not always prioritized construction of renewable energy sources.

Challenges ahead

The average income of a Maine family is between $40,000 and $50,000 a year, according to figures from the offshore wind report. Dagher and other officials related to the project estimate that 20 percent of the average family budget in Maine, or a total of $5 billion, leaves the state to pay for energy.

“When you look at energy costs for a Maine family, it’s three things: It’s gasoline for your car, it’s heating oil in the basement, and then it’s electricity. We are the most heavily reliant state on heating oil in the country; 80 percent of us use oil to heat our homes,” said Dagher.

Offshore wind-generated electricity would be coupled with either electric heat pumps or electric thermal storage units and enhanced-range electric vehicles to reduce energy prices well below current levels over the next two decades, said Dagher.

But retrofitting thousands of Maine homes with these kinds of electric units would come at an immense cost, according to LaBrecque.

Although heat pumps would provide reduced heating costs, electric thermal storage units would actually increase the average Maine family’s heating bill, especially until the price of offshore wind power can be reduced, LaBrecque said.

He added that it is “foolish” to think that the majority of the state would be using electric vehicles by 2025, as proponents of the offshore wind project predict.

“The world does not face an energy supply problem, but a technology paradox,” he said. “Technology advancements that society hopes will save us from the diminishing supply of energy are the same advancements that forced us into the era of diminishing supplies.”

LaBrecque contends that plans for offshore wind would be contradictory to energy efficiency goals. He said that by adding more heat pumps, thermal storage units and charging vehicles to the electric grid, the nation and the state would only increase their energy demands and thus increase the amount of fossil fuels needed to account for such demand, especially when renewable energy sources cannot make a “hairline scratch in energy consumption rates.”

Dagher said he understands the challenges, but he argued that the state’s energy resources must be diversified and the problem cannot be ignored.

“Nobody is saying we are going to use wind to completely power the state,” Dagher said. “However, my expectation is this will be the least costly form of energy that Maine has access to. It might not be today, or next week, or very soon, but with diligence and hard work this will be a part of a mix of solutions to provide energy.”

BDN writer Kevin Miller contributed to this report.