New York regulators seek comments on regulatory program involving offshore wind

The New York State Public Service Commission, in an April 11 notice, said that comments are invited by June 4 on the adoption of a regulatory program to encourage the procurement of electricity from new offshore wind generating facilities by New York State consumers.

That includes, in part, consideration of the Jan. 29 “Offshore Wind Policy Options Paper” filed by the New York State Energy Research and Development Authority (NYSERDA) that provides an assessment of alternatives for addressing various policy issues pertinent to the deployment of offshore wind energy.

The commission added that as a component of the regulatory program, it is considering adopting a goal that the quantity of electricity supplied by renewable resources and consumed in New York be increased by the output of 2,400 MW of new offshore wind generation facilities by 2030 as part of a strategy to reduce statewide greenhouse gas emissions by 40% by 2030. The goal under consideration is based on contributions towards achievement of the goal by each New York load serving entity (LSE) serving retail customers, such as the non-jurisdictional Long Island Power Authority (LIPA) and New York Power Authority (NYPA).

The commission also said that as a Phase 1 component of the regulatory program, it is considering the adoption of a requirement to jump-start the deployment of offshore wind resources to serve New York consumers by requiring each New York LSE to serve retail customers by procuring new offshore wind resources, evidenced by the competitive procurement of qualifying offshore wind renewable energy credits (ORECs), obtained in solicitations to be conducted this year and in 2019 to procure the annual renewable energy attributes associated with up to 800 MW of new offshore wind generation facilities.

Discussing the Phase 1 competitive solicitations, the commission said that sufficient competitive solicitations would be conducted by NYSERDA, LIPA, and/or NYPA in 2018 and 2019, in cooperation with each other, to obtain in total the intended 800 MW. The quantity of megawatts that is procured by each soliciting entity towards the 800 MW need not be limited to the proportional share of retail load to be served, but instead could be based on quantities deemed efficient for each particular solicitation, the commission said.

Solicitations conducted by NYSERDA would be for the procurement of ORECs only and would have 25-year contract terms, the commission said, adding that LIPA and/or NYPA could agree to have NYSERDA obtain a share of ORECs for them through NYSERDA’s solicitations, or could conduct their own solicitations.

The commission noted that eligibility would be limited to offshore wind electric generation facilities, located in ocean waters of the United States, that become operational on or after Jan. 1, 2015; that deliver their electric energy into the New York Control Area for consumption by New York consumers, either by direct generator lead into New York or by transmission across adjacent control areas into New York; that upon submission of a bid have already obtained a lease for the offshore ocean site from the U.S. Bureau of Ocean Energy Management (BOEM); and that are located a minimum distance from shore necessary to minimize visual impacts from land, to be pre-determined by the commission.

The commission said that it is considering whether the minimum distance should be 20 statute miles, or some lesser or greater minimum distance.

NYSERDA would score competitive bids by giving a relative weight of 70% to price, 25% to economic benefits, and 5% to project viability, the commission said.
The commission also noted that it is considering a number of options for NYSERDA’s procurement of ORECs, including a “Fixed OREC” approach, under which winning projects would receive a fixed, as-bid OREC price throughout the contract lifetime. Each OREC would represent the renewable attributes associated with 1 MWh of electricity generated, the commission said.

Under each procurement option, NYSERDA would purchase the ORECs, on behalf of the LSEs, and then resell them to the LSEs for compliance with the LSEs’ obligation, the commission said. Each LSE would be required to enter into a contractual relationship with NYSERDA to periodically purchase ORECs during a program year balanced in a reconciliation process so that the quantity of ORECs purchased by the LSE during the program year equals the LSE’s proportional share of the total number of ORECs purchased by NYSERDA, the commission noted. The proportional share of each LSE would be based on the quantity of retail sales load served by the LSE during the program year, the commission said, adding that Phase 1 ORECs would not be tradable by LSEs except with NYSERDA.

Discussing “Phase 2,” the commission said that shared radial and independently owned transmission options are reserved for consideration in Phase 2 and would not be considered for the Phase 1 competitive solicitations. The options of incorporating environmental impact criteria other than the minimum distance from land into the eligibility requirements and incorporating environmental impact criteria into the bid scoring calculations are reserved for consideration in Phase 2 and would not be considered for the Phase 1 competitive solicitations, the commission said.

BOEM Call

BOEM on April 6 said that it is publishing a Call for Information and Nominations (Call) to obtain nominations from companies interested in commercial wind energy leases within the proposed area in the New York Bight region, which represents an area of shallow waters between Long Island (to the north and east) and the New Jersey coast (to the south and west).

The proposed locations – or “Call Areas” – under consideration are delineated as Fairways North, Fairways South, Hudson North, and Hudson South, BOEM said, adding that the four Call Areas include 222 whole OCS blocks and 172 partial blocks, and comprise about 2,047 square nautical miles (702,192 hectares).

In addition to nominations, BOEM said that it seeks public input on the potential for wind energy development in the Call Area, including site conditions, resources, and multiple uses in close proximity to, or within, the Call Areas that would be relevant to BOEM’s review of any nominations submitted, as well as BOEM’s subsequent decision whether to offer all or part of the Call Areas for commercial wind leasing.

BOEM said that it will publish the Call in the Federal Register on April 11, and that it will accept nominations and comments until May 29.

BOEM noted that it has awarded 13 commercial wind energy leases off the Atlantic coast and expects to hold an additional competitive auction for wind energy areas offshore Massachusetts later this year.

Separately on April 6, U.S. Secretary of the Interior Ryan Zinke announced the proposed lease sale for two areas offshore Massachusetts for commercial wind energy leasing, totaling nearly 390,000 acres. A Proposed Sale Notice (PSN) for Commercial Leasing for Wind Power on the Outer Continental Shelf Offshore Massachusetts will be published in the Federal Register on April 11, and will include a 60-day public comment period, the Interior Department statement noted.

The PSN requests public comments on BOEM’s proposal to auction two lease areas offshore Massachusetts for potential commercial wind energy development, the statement noted, adding that Lease OCS-A 0502 consists of 248,015 acres and Lease OCS-A 0503 consists of 140,554 acres.

According to the statement, the PSN also requests from potential bidders:

  • Affirmation of continued interest from any prospective bidders already qualified for commercial wind energy development offshore Massachusetts
  • Submission of the required qualification materials from any prospective bidders that BOEM has not previously qualified for a Massachusetts lease sale

On April 4, BOEM said that it is conducting a high-level assessment of all waters offshore the U.S. Atlantic Coast for potential future offshore wind lease locations. BOEM said that it is seeking input on the Proposed Path Forward for Future Offshore Renewable Energy Leasing on the Atlantic Outer Continental Shelf through a Request for Feedback that was to be published in the Federal Register on April 6; stakeholders should submit comments by May 21.

About Corina Rivera-Linares 3058 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.