Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Economy

New York Rejects Plan to Rescue Sinking Wind Projects

Electricity bills won’t be coming to the rescue.

Offshore wind.
New Yorkers Won’t Be Helping Offshore Wind Stay Afloat
Heatmap Illustration/Getty Images

Offshore wind developers aren’t going to get more money from New Yorkers to complete their projects.

On Thursday, New York’s Public Service Commission, which regulates utilities, rejected a request by an alliance of developers of offshore wind and other large-scale renewables projects to have their contracts adjusted for higher costs.

The difference, which the commission’s staff estimated to be $12 billion, would have translated to ratepayers paying an extra $4.67 a month on their electricity bills, according to an analysis by the New York State Energy Research and Development Authority (NYSERDA).

The projects, 91 in all, make up 13.5 gigawatts of planned capacity, almost a quarter of what the state projects it will need by 2030. They include four offshore wind farms that would make up over four gigawatts of capacity, plus a mix of onshore wind, solar, and transmission projects. In the run-up to Thursday’s meeting, an alliance of labor, business, and environmental groups pushed the commission to accept altering the contracts in order for the projects to stay on track.

The entire offshore wind industry has been dealing with rapidly rising costs and has been in a game of chicken with governments across the world over who should shoulder them.

What happens next, especially for the four offshore wind projects in New York state, is, well, up in the air. It’s possible that the developers could cancel the projects and the state could put them out for another round of bidding. There could be some kind of deus ex machina funding coming from taxpayers, a coalition of states in the region, or the federal government.

In New Jersey, the state legislature and governor agreed to send federal subsidies to offshore wind developers in order to keep costs down. But in Massachusetts, developers agreed to pay cancellation penalties instead of going through with projects that they thought were uneconomic.

On Thursday, New York’s commissioners placed blame for any cancellation or delay of the offshore wind projects on the developers for not being able to deliver profitable projects within the terms of their original contracts.

“Many are left with the impression that the fate of the clean energy transition rests entirely on this action today,” the commission’s Chairman Rory Christian said. “These projects ... collectively represent a portion of our collective effort to bring various mandates ... to bear and achieve the clean energy future demanded by the public.”

Existing New York state law mandates that 70 percent of the state’s electricity come from renewables by 2030. For downstate New York — the Hudson River Valley, New York City, and Long Island — this law means a fast energy transition, as the region is largely dependent on fossil fuels, namely natural gas, for electricity. It also makes up the bulk of the state’s population and electricity use. Since the shutdown of the Indian Point nuclear power plant in 2021, the region's energy future has long been assumed to be offshore wind.

The developers “could still re-bid and, if successful at a future solicitation,” a filing by NYSERDA said, “however, this could result in significant delays and thus impact the state’s progress towards achieving the Climate Act goal of serving 70% of the State’s electric load with renewable energy by 2030.”

“These projects are not everything,” Christian responded. “They are one part of our portfolio.”

“Some large-scale projects facing massive milestone payments need greater certainty than afforded by today’s decision, and unfortunately will likely cancel projects and withdraw from the New York market. Other projects will have the ability to re-bid, and we do expect that many will re-bid,” said Anne Reynolds, executive director of the Alliance for Clean Energy New York, an industry group that petitioned for the contract adjustments.

“We also expect that collectively, hundreds of millions of dollars that were invested as contract deposits will be lost; the bid prices will be higher based on the same inflation pressures we described in our petition; the 2024 construction season will be missed; and various grid interconnection deadlines will be missed.”

The commissioners, both Republican and Democrat, were little moved by developers’ pleas that the projects would be delayed or even canceled.

“The developers have a contract,” said Commissioner Tracey Edwards. “The audacity that you would think this commission would grant an additional $12 billion ... [it]is just not doable. Walking away is your choice and we certainly hope you do not do that.”

Yellow

You’re out of free articles.

Subscribe today to experience Heatmap’s expert analysis 
of climate change, clean energy, and sustainability.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Politics

EPA Claims Congress Killed the Green Bank

The saga of the Greenhouse Gas Reduction Fund takes another turn.

Throwing away a green bank.
Heatmap Illustration/Getty Images

On July 3, just after the House voted to send the reconciliation bill to Trump’s desk, a lawyer for the Department of Justice swiftly sent a letter to the U.S. Court of Appeals for the D.C. Circuit. Once Trump signed the One Big Beautiful Bill Act into law, the letter said, the group of nonprofits suing the government for canceling the biggest clean energy program in the country’s history would no longer have a case.

It was the latest salvo in the saga of the Greenhouse Gas Reduction Fund, former President Joe Biden’s green bank program, which current Environmental Protection Agency Administrator Lee Zeldin has made the target of his “gold bar” scandal. At stake is nearly $20 billion to fight climate change.

Keep reading...Show less
Energy

How the Interconnection Queue Could Make Qualifying for Tax Credits Next to Impossible

A renewable energy project can only start construction if it can get connected to the grid.

Power lines, money, the Capitol, and a map.
Heatmap Illustration/Getty Images

The clock is ticking for clean energy developers. With the signing of the One Big Beautiful Bill Act, wind and solar developers have to start construction (whatever that means) in the next 12 months and be operating no later than the end of 2027 to qualify for federal tax credits.

But projects can only get built if they can get connected to the grid. Those decisions are often out of the hands of state, local, or even federal policymakers, and are instead left up to utilities, independent system operators, or regional trading organizations, which then have to study things like the transmission infrastructure needed for the project before they can grant a project permission to link up.

Keep reading...Show less
Green
Climate

AM Briefing: NOAA Nominee Vows to Fill Forecaster Vacancies

On Neil Jacobs’ confirmation hearing, OBBBA costs, and Saudi Aramco

Would-be NOAA Administrator Vows to Fill Forecaster Vacancies
Heatmap Illustration/Getty Images

Current conditions: Temperatures are climbing toward 100 degrees Fahrenheit in central and eastern Texas, complicating recovery efforts after the floodsMore than 10,000 people have been evacuated in southwestern China due to flooding from the remnants of Typhoon DanasMebane, North Carolina, has less than two days of drinking water left after its water treatment plant sustained damage from Tropical Storm Chantal.

THE TOP FIVE

1. Trump’s nominee to head NOAA vows to fill staffing vacancies

Neil Jacobs, President Trump’s nominee to head the National Oceanic and Atmospheric Administration, fielded questions from the Senate Commerce, Science, and Transportation Committee on Wednesday about how to prevent future catastrophes like the Texas floods, Politico reports. “If confirmed, I want to ensure that staffing weather service offices is a top priority,” Jacobs said, even as the administration has cut more than 2,000 staff positions this year. Jacobs also told senators that he supports the president’s 2026 budget, which would further cut $2.2 billion from NOAA, including funding for the maintenance of weather models that accurately forecast the Texas storms. During the hearing, Jacobs acknowledged that humans have an “influence” on the climate, and said he’d direct NOAA to embrace “new technologies” and partner with industry “to advance global observing systems.”

Keep reading...Show less
Yellow