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Bill Implementing Maine Ocean Energy Task Force Recommendations Released

The Governor's Bill implementing the recommendations of Maine's Ocean Energy Task Force has been printed as LD 1810. Senators Hobbins and Raye and Representatives Fitts and Berry are the bill sponsors.  

The 41 page bill, drafted as emergency legislation, contains a broad range of provisions that are designed to overcome the economic, technical and regulatory obstacles to to provide economic incentives for vigorous and efficient development of marine renewable energy sources.  The provisions include authorization for the PUC to conduct a competitive solicitation for proposals for offshore wind, tidal and wave energy produced in state or federal waters and to negotiate a long-term contract with a technically competent generator if the contract terms would not have an unreasonable rate impact.  A hearing on the bill are scheduled for March 11 at 1 pm at the Utilities and Energy Committee.

Previous posts on the Ocean Energy Task Force:

Maine Ocean Energy Task Force Submits Final Report

The Straw Proposal: Offshore Wind and Tidal Power Seek Surer Footing on Maine’s Submerged Lands

FERC and Maine Sign MOU on Ocean Tidal Power

Safe Passage for Ocean Energy

Maine Ocean Energy Task Force Submits Final Report

The Maine Ocean Energy Task Force  submitted its final report (pdf) with detailed appendices (pdf), to Governor Baldacci on December 31, 2009.  (We discussed earlier drafts of this proposal in this previous post.)

OETF Co-Chairperson Beth Nagusky, Director of Innovation and Assistance at the Maine Department of Environmental Protection, has indicated that The Governor's Office will submit draft legislation to implement the OETF recommendations early in the legislative session.
Key findings of the Report include recommendations that Maine:

• Make a major commitment to development of offshore wind, tidal, and wave power;
• Commit to a goal of installation of 5 gigawatts (5,000 megawatts) of offshore wind energy generating capacity in Maine’s coastal waters and adjoining federal waters by 2030, and to a goal of timely and efficient development of tidal energy resources at optimal locations in Maine’s coastal waters, including but not limited to those in the Passamaquoddy Bay region;
• Improve the siting, permitting and governance framework for renewable ocean energy development;
• Move aggressively to support strengthening Maine's current out-dated transmission and distribution infrastructure, incorporating smart-grid technologies, and explicitly recognize in law the need for new transmission and distribution capacity to achieve the State’s wind power and energy conversion goals; and
• Support the financing and development of renewable energy goals by requiring the Maine Public Utilities to issue a Request for Proposal for renewable ocean energy generation where the rate impact is reasonable.

For more information about the Ocean Energy Task Force and offshore development opportunities in Maine, contact Pierce Atwood's Lib Butler.  

Testing the Wind

Today, in accordance with LD 1465 (pdf), “An Act To Facilitate Testing and Demonstration of Renewable Ocean Energy Technology,” Maine’s Governor Baldacci announced the final selection of three offshore wind energy demonstration areas in Maine.  (The four site finalists were announced in October 2009, as discussed in this previous post.)

One of the three sites, located near Monhegan Island, is designated as the “Maine Offshor Energy Research Center,” which will be used for research and development projects run by (or in cooperation with) the University of Maine.

The other two sites – off Boon Island near York and off Damariscove Island near Boothbay - are available for R&D projects by commercial entities.  To obtain a permit for a project in one of these sites, a company must first apply for a general permit for offshore wind energy demonstration project under 38 MRS §480-HH from the Department of Environmental Protection.

With a MDEP general permit approval in hand, the company must then apply for a submerged lands lease from the Department of Conservation.  Because these sites are designated for research and development uses rather than permanent, commercial installations, permits for the Boon Island and Damariscove Island sites will good for five years from the date they were granted or three years from the date construction starts (with certain term extensions available); in applying for the permit, applicants must provide a project removal plan that details how they will remove the project at the end of the permit period.

More details about the demonstration areas, including interactive maps of the designated areas, are available at the Department of Conservation site.

This site selection process complements the work of the Ocean Energy Task Force and its recommendations concerning legislation to make near-shore and off-shore sites available for both R&D and ultimately commercial renewable energy projects.  The draft final report of the OETF can be found here. 

Fox Islands Wind Project Is Live: Community Wind on the New England Coast

Yesterday, the Fox Islands Wind Project held its official ribbon-cutting, attended by dignitaries from around the state and our own Lib Butler, Avery Day, Tom Doyle and Nick Livesay (Pierce Atwood represented Fox Islands Wind throughout this process). After years of work, the project is expected to lower electricity rates for island residents, and keep year-round island living economically viable. 

The three turbine, 4.5 MW project is not large for Maine, compared to facilities like TransCanada's 44 turbine, 132 MW Kibby Mountain installation, currently under construction, or First Wind's 38 turbine, 57 MW Stetson Wind project.  But the project may offer a glimpse of the future of wind development in Maine and New England.

In the near term at least, it's likely to be increasingly difficult to construct large scale terrestrial wind in Maine.  Both existing and proposed projects have encountered increasingly fervent opposition, which cites concerns about building in scenic or otherwise undeveloped landscapes, and the growing, if unsubstantiated, claims of negative health effects from wind turbines near homes.  The pace of current proceedings at the Maine PUC for approval of a transmission project needed for reliability purposes does not bode well for the sizable transmission projects needed to meet state and regional wind development goals.  One solution is the state's aggressive development of offshore wind, which, though fabulously expensive, is not in anyone's backyard.

The model of the Fox Islands Wind Project offers another solution: relatively small, community-owned projects sited close to load, owned by those who will use the electricity. While the process of constructing Fox Islands' wind turbines was similar to other wind projects (though not without some island-specific twists), the process of developing community support was unique, involving a deep commitment to community education and detailed engineering, economic, environmental and visual impact studies. The Island Institute, working with the Fox Island Electric Cooperative, a member-owned cooperative utility, involved the community members throughout the process.  The cooperative initially created a wholly-owned project development company.  That company then designed the project, and found private equity investors and US government loans to finance the project.  Research suggests that local residents' sense of ownership and participation in a project's development can have a positive effect on their response to the visual and auditory impact of wind turbines.  The Fox Island experience bears this out: as a result of this process, island residents voted to approve the project by a vote of 383 to 5 in July of 2008.  The response to the project in the coming months and years will be telling, both for Vinalhaven and for the other communities around Maine that hope to replicate the success of the Fox Islands Wind Project.

Maine Forest Service Announces Funding for Biomass Heating for Public Buildings

Last Thursday, the Maine Forest Service announced its Request for Application for its Public Building Wood to Energy Program, funded by $11.5 million in funds received under the American Recovery and Reinvestment Act (ARRA).  The Forest Service expects to use approximately $10 million of that money to fund at least fifteen "shovel-ready" projects to convert public buildings to wood or dual-fuel heating. Projects must be completed within one year of receiving a grant. The program is open to all Maine public entities or parties with public buildings, including schools, hospitals, state, county, local and tribal governments.

Two classes of projects will be eligible for awards:

Standard Projects:
Eligible for grants of up to $25,000.  Example projects include smaller conversions to wood based systems such as a small pellet boiler or furnace or appropriately-sized wood pellet stove.  Generally, these systems will be less than 200,000 BTU’s and will involve a single building or other small facility.

Complex Projects:
Eligible for grants of up to $750,000.  Systems in this category will typically be larger systems in excess of 200,000 BTU’s installed in larger facilities or serving multiple building such as heating several dorms on a college campus.

Applications are due by January 5, 2010, with awards granted as soon after reciept.  More information, including the complete Request For Applications, can be found at the Maine Forest Service's ARRA site.

The Forest Service's RFA represents the first significant funds Maine has put toward biomass conversion, despite several years of effort and study by Governor Baldacci's Wood to Energy Task Force and several legislative proposals to support biomass conversion for public buildings.  Many see biomass as essential to help reduce the state's reliance on oil in general and foreign oil in particular, an issue of particular concern in Maine, where over 80% of homes rely on #2 heating oil for residential heating, more than any other state.  New Hampshire's Governor John Lynch has also expressed support for use of biomass for heating. 

The road ahead for biomass is uncertain: industrial biomass development in New England continues, with ten new biomass facilities in the ISO-NE Interconnection queue, totalling 373.65 MW of new capacity.  Together with use of biomass for heating, this has prompted concerns about the capacity of Northern New England's forests, competition with the pulp and paper industry, and the environmental impact of burning all this wood.  Nonetheless, for those facilities eligible for this RFA, these funds offer an opportunity for significant long term savings and reduced reliance on oil. 

Maine Narrows Offshore Wind Sites to Four

After a series of public information workshops in September along the coast of Maine, the Maine Department of Conservation announced (pdf) on Tuesday that it has narrowed the potential sites for an offshore wind energy demonstration site from seven to four sites.  The four sites include areas off Boon Island, Damariscove Island, Monhegan Island and the town of Cutler.  This site will be used by the University of Maine national offshore wind demonstration project, recently awarded an $8 Million grant from the Department of Energy, to test deepwater wind turbine technology. The State explained that the consultation process has allowed the State to choose the areas with the fewest impacts on existing fisheries and wildlife.

The Department of Conservation will be accepting comments until November 30th.  Legislation passed this June requires the Department to select a site by December 15th, 2009.

DOE Grant to Maine Consortium to Study Offshore Wind

DOE today announced an investment of up to $8M in the University of Maine’s Deepwater Offshore Wind Test Site and related educational initiatives.  The award was one of three competitive grants made to university-led consortia that will support university research and development programs to improve wind turbine performance and reliability and undergraduate and graduate educational opportunities in cutting-edge wind technologies.  The University of Maine is the only grant recipient that will research and develop deepwater wind technologies.

The University of Maine consortium includes Norway’s StatoilHydro, which recently hosted Maine’s Governor Baldacci and a Maine trade mission (including Pierce Atwood’s John Gulliver) to Europe to discuss renewable energy opportunities.  (For more on the trade mission, see our previous post.)  Trade mission members were invited to visit StatoilHydro's 2.3-megawatt Hywind turbine, the only offshore, deep-water, power-generating wind turbine in the world.  A more detailed account of the trade mission is here.  After seeing the Hywind turbine, Governor Baldacci and University of Maine’s Prof. Habib Dagher signed a letter of intent with StatoilHydro to explore whether this deepwater wind technology could be put to work in Maine.  The DOE grant marks a great step forward for this public-private partnership. 

Maine Issues RFP for Efficiency and Conservation Grants

After months of anticipation, on Friday, Maine’s Energy and Carbon Savings Trust and Efficiency Maine announced two RFPs for Energy Efficiency and Conservation Projects.  Together, the RFPs offer over $15 million in funding for efficiency and conservation projects by businesses and municipalities.

Competitive Grants for Large Energy Efficiency and Conservation Projects

The first RFP offers grants for “large energy efficiency and conservation projects.”  These grants will be funded by a combination of approximately $6 million in ARRA funds administered by the MPUC and designated for “job creation, energy efficiency, renewable energy, weatherization, and workforce development” and $3 million in RGGI auction funds administered by the Energy and Carbon Savings Trust.  ARRA funds must be spent or committed within two years.

Pursuant to a competitive grant program, Efficiency Maine and the Trust are seeking applications for large energy efficiency and conservation projects with the primary goals of reducing kilowatt hour (kWh) consumption, encouraging alternative and renewable energy, and decreasing greenhouse gas (GHG) emissions.  Grant awards will range from $100,000 to $1 million and will be used to support eligible commercial and industrial projects that will save or create jobs, achieve energy savings and GHG reductions, and are “project-ready.”  Applications for eligible projects that accomplish these goals will be evaluated on the criteria of cost effectiveness, management and resource adequacy and readiness, and economic impact.

To be eligible, projects must be at a single commercial or industrial location and at least 30 percent of the total project cost must come from private funding, including financing.  Examples of eligible projects include energy improvements for industrial and commercial processes and equipment; compressed air systems; boilers and steam systems including biomass fired; combined heat and power systems in various settings; waste-heat recovery; and solar and wind systems.  Ineligible projects include those mandated by law or required by standard industry practice, feasibility studies and projects where funds will be used at multiple locations.

Energy Efficiency and Conservation Block Grants

The second RFP offers more than $5.7 million in grants for Municipal and County energy efficiency and conservation projects, including renewable energy projects, from units of local and county government.  This program is funded by the ARRA’s Federal Energy Efficiency and Conservation Block Grant (EECBG) program.  Maine’s ten largest cities received formula grants earlier this year (see our earlier post).  Now, Maine’s remaining communities and counties may obtain support for energy use planning, action-ready projects that previously could not be funded, and/or the initial stages of projects promising long-term energy savings and emissions reductions.  This opportunity consists of two alternatives, one for “Custom Projects” and another for standardized or “Template” projects.  Custom project grants, which assist communities to bring planned projects to realization, may be up to $85,000 each (or up to $500,000 regionally) and are awarded on a competitive basis; template project grants, which assist communities with planning and/or energy use analysis, may be up to $10,000, as funds allow.  Efficiency Maine expects that a second round of these RFPs will be issued in early 2010.

Proposals for both RFPs must be submitted by 2:00 pm on November 4, 2009.

If you would like more information about the program, please contact John Gulliver, Bill Hewitt or Patty Aho. 

New England Governors Release Renewable Energy Blueprint

On Tuesday, the New England Governors' Conference released its Renewable Energy Blueprint. The Blueprint is based in part on a draft study conducted by ISO New England at the Governors' request, the New England 2030 Power System Study (pdf),which explored a range of different renewable energy development scenarios for New England.  The Governors' Blueprint is intended to identify strategies to "help bring new renewable resources to market within the current market structure." To that end, it identifies three main opportunities for New England states:

1) Synchronize states' power procurement and contracts -  Each New England state has authority to procure renewable energy, capacity, energy and RECs, usually in the form of long term contracts with generators selected through a competitive solicitation process.  The blueprint reviews these laws, and proposes synchronizing these approaches to obtain the most cost-effective renewable resources.  This makes some sense: the wind developments needed to meet the domestic wind generation totals envisioned in the ISO-NE study (from 2,000 to 12,000 MW) dramatically exceed the scale of any single state's existing procurement program.  Given the costs and uncertainty involved, offshore wind in particular (the ISO-NE study considers as much as 4,500 MW of offshore wind) will rely on state-mandated long term contracts in the foreseeable future. But state procurement authority is typically tied to in-state development of renewables:  coordinated procurement would not address states' interests in fostering their own in-state renewable energy industries.

2) Coordinate siting of interstate transmission facilities - The Blueprint offers an overview of state transmission siting laws, and explores the possibility of coordinating these processes to facilitate building large interstate transmission lines.  Right now, there aren't any existing plans to build any such lines in New England (at least onshore: there are a number of proposals to link Maine and Massachusetts underwater), but the ISO Report states the need for a lot of new interstate transmission lines to support New England's renewable energy goals.  For example, the 12,000 MW wind case contemplates "a new three-subloop, dual circuit overhead 500 kV or 765 kV backbone transmission system overlaying most of the interior of New England."  The cases involving expanding interconnections with Quebec and New Brunswick propose two lengthy +/- 450 kV HVDC lines, including a 400 mile line stretching from the Maine-New Brunswick border to Millbury, Massachusetts.

3) Strengthen federal support for state and regional renewable development - This last category is more a hodge podge of things that New England would like the federal government to do, including prioritizing and expediting federal permitting for off-shore wind projects in state and federal waters, and providing additional funding for development of renewable resources and transmission infrastructure.  Most important, though is a general plea that the federal government:

Respect regional system planning processes and consider the results of regional transmission system plans and renewable resource scenario analysis as guidance in connection with interconnection wide analyses and any federal financial support for renewable energy infrastructure development

This hints at what's really driving the blueprint: New England governors' concerns about federal intervention forcing New England ratepayers to contribute to massive transmission projects needed to bring the huge amounts of wind planned in the Midwest to New England markets.  (For an example of what this might look like, see the Joint Coordinated System Plan (pdf), released by MISO, PJM and other regional entities in February, or our previous post on the subject.) In addition to the costs, those projects, backed by federal subsidies, could crowd out renewable energy investment in New England.  The Blueprint, along with the ISO-NE study, represent New England's latest efforts to show that New England can meet its renewable energy goals with intra-regional solutions.

The Straw Proposal: Offshore Wind and Tidal Power Seek Surer Footing on Maine’s Submerged Lands

Maine’s Ocean Energy Task Force (OETF) Regulatory and Permitting Subcommittee met this Tuesday, September 8th, to discuss a Straw Proposal for a set of recommendations to the full OETF.  The Subcommittee chair, State Planning Office (SPO) Director of Coastal Zone Management Planning, Kathleen Leyden, and SPO staffer Todd Burroughs reviewed the proposal with Regulatory Subcommittee members, accepting comments from members of the public. The Subcommittee meeting minutes will be posted at its page on the OETF website.

The Straw Proposal would establish that development of renewable ocean energy resources, including tidal and wind power, is an authorized use of state submerged lands.  But some commenters noted that the proposed language requiring "due consideration" and even compensation to be provided by renewable developments for other existing commercial uses, such as fishing, gives commercial fishing a superior right to use of submerged lands, rather than putting renewable resource uses on equal footing with fishing interests.  It was noted that the Subcommittee Recommendation to the OETF should include the option that renewable energy projects be recognized as an appropriate use of submerged lands, equal (or even higher) in priority to other uses, given the urgency of the need for renewable energy.

Tidal developers also pointed out that the straw proposal is focused exclusively on wind, and has not taken into account the unique aspects of tidal power projects.  DEP and SPO staff indicated that they believe that the Maine Waterways Act is sufficient to regulate tidal power, and that only the submerged lands, tax, and federal state coordination provisions of this proposal would apply to tidal power.  Members of the public were encouraged to provide more detailed commentary on this point, especially the unique aspects of the FERC Pilot Project process used for tidal projects.

The Subcommittee has been asked to complete its recommendation on legislation to the OETF by September 15, 2009.

For more information regarding the Straw Proposal or OETF, please contact Lib Butler, Sarah Verville or Chip Ahrens.