New York Power Authority Releases Report on Learnings from European Wind Projects That Will Help Guide U.S. Offshore Wind Development

The New York Power Authority (NYPA) today shared key learnings from a study of European offshore wind transmission models that will help guide New York State as it moves aggressively towards its 9 gigawatt (GW) offshore wind goal by 2035 and inform regional and national offshore wind development. The report, commissioned by NYPA and its New York State energy partners, identified healthy competition and scaling up generation and transmission assets as key to building New York’s offshore wind capacity and meeting the state’s renewable energy goals. Release of the study follows Governor Andrew M. Cuomo’s July 18 announcement of the Empire Wind and Sunrise Wind development projects that were selected in New York’s first comprehensive wind solicitation, together totaling 1,700 megawatts (MW) of wind power, enough to power more than one million New York homes and support more than 1,600 jobs with a combined economic activity of $3.2 billion statewide.

“Offshore wind is an important renewable energy source that will help New York State achieve Governor Cuomo’s nation-leading clean energy goals,” said Gil C. Quiniones, NYPA’s president and CEO. “We see great value in studying what European countries have learned about transmission and interconnection infrastructure. We can now apply those learnings to build cost-effective projects that benefit all New Yorkers and our key partners and stakeholders while advancing the Governor’s aggressive climate goals.”

The Governor’s clean energy agenda recognizes the integral role of wind to fulfill his mandate to decarbonize the energy sector by 2040 and have 70 percent of the state’s electricity come from renewable sources by 2030. As of today, New York has awarded a total of approximately 4,700 MW of large-scale renewable energy contracts since March 2018 through three separate solicitations, a globally significant advancement in renewable energy. Collectively, these projects will provide enough renewable energy to power up to two million households and meet nearly 10% of New York's electricity needs by 2025.

Takeaways from the Offshore Wind – A European Perspective report will help move the state even further along in its goals including the 70 percent renewable power by 2030 goal and its target for reducing energy-related greenhouse gas emissions by 85 percent from 1990 levels by 2050.

The study closely examined transmission and grid interconnection strategies, as well as development and electricity rate structures in the United Kingdom, Germany, the Netherlands and Denmark, which enabled each country to lower its costs over time. Many successful approaches to developing an offshore wind system were identified. A series of key takeaways were highlighted to help guide the evolution of the offshore wind industry in the U.S. as it continues to quickly evolve.

Key learnings from the report include:

• Planning for scale and encouraging healthy competition have been key to the growth of offshore wind in the four countries studied (Denmark, the Netherlands, Germany and the United Kingdom).
• Transparent, long-term, on and offshore grid planning removes barriers to entry, improves coordination and lowers costs.
• In Europe, cross-border coordination has helped countries leverage planned transmission infrastructure, provide resource flexibility and take advantage of economies of scale. 
• Long-term grid planning for both on and offshore, coordination and performance incentive alignment are really important so parties are incentivized to finish projects in a timely manner.

NYPA joined with the New York Independent System Operator (NYISO), Con Edison, the New York State Energy Research and Development Authority (NYSERDA) and the Long Island Power Authority (LIPA) in August 2018 to commission the in-depth study, with additional input from National Grid. Researchers looked at offshore wind development in Europe to acquire insight into how to take full advantage of the region’s more than two decades of experience with this critically important source of renewable energy.

LIPA CEO Thomas Falcone said, “As New York gears up for the rapid development of offshore wind under Governor Cuomo’s leadership, having a better understanding of Europe’s already-thriving industry will provide key insights as we look to build a skilled workforce and develop our ports. This study will help evolve our state’s clean energy goals and spur further economic development. New York will continue to lead the Northeast and be the hub for offshore wind development.”

Rich Dewey, President and CEO of the NYISO, said, “The NYISO was pleased to work with NYPA to explore the lessons learned from offshore wind development in Europe. The State’s ambitious goals for renewable energy require planning and analysis to reliably integrate offshore wind into the power grid.  We look forward to continue working with the State to efficiently incorporate these resources into competitive power markets.”

The waters off New York City and Long Island offer some of the best available wind resources in the world, putting New York in a prime position to support offshore wind development in the U.S. The study anticipates that states along the Northeast coast together will be able to generate a total of 19 GW of offshore wind by 2035. 

Several European nations have already installed 18 GW offshore wind capacity over the past 20 years and have committed to building a total of 70 GW by 2028. For example, Denmark, the Netherlands, Germany and the United Kingdom have collectively connected 16 GW of offshore wind to their onshore grids. While each country, with its own unique geography and circumstance, followed its own particular path of development, there are important lessons and themes that can help guide the evolution of the U.S. offshore marketplace.

Stuart Nachmias, Con Edison Vice President for Energy Policy and Regulatory Affairs, said, “Offshore wind will be an instrumental part of our region’s renewable energy future, and Con Edison is fully committed to proposing efficient ways to build the upgraded transmission system needed to meet the state’s offshore wind goals.”

John Bruckner, President of National Grid NY, said, “This well researched report is very important for New York as it draws upon the extensive European experience with offshore wind. We’re pleased to have shared with NYPA and others our direct experience in the United Kingdom with offshore wind interconnections and transmission. We think it will be very helpful as we transition to a cleaner energy future.”  

As part of the state’s overall efforts in harnessing this renewable resource, in 2017, LIPA signed a Power Purchase Agreement (PPA) with Ørsted to purchase the energy and capacity from its 90 MW South Fork Wind project and in 2018 expanded the project by 40 MW to a total of 130 MW.  NYSERDA, as part of its efforts to develop offshore wind on behalf of the state, conducted 20 in-depth studies over three years which included extensive stakeholder, agency, and public consultation along with detailed technical and financial analysis. These studies provided the basis for New York's Offshore Wind Master Plan (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 the development of offshore wind in New York. In February 2019, NYSERDA received an unprecedented response – four proposers submitted a total of 18 bids – to its inaugural solicitation for 800 MW or more of offshore wind. New York awarded two offshore wind projects under the single largest renewable energy procurement by any state in U.S. history – totaling nearly 1,700 MW. These projects are expected to catalyze the first generation of major United States supply chain investments by the fast-growing offshore wind sector, positioning New York to be the hub of the nation's burgeoning offshore wind industry.

To read the Offshore Wind – A European Perspective report in its entirety click here. For more information about the nation’s largest offshore wind agreement, announced on July 18, and New York’s recently signed Climate Leadership and Community Protection Act click here.