The War Over Offshore Wind Is Almost Over

It's no longer if, but when, where, and how many wind farms will go up along the U.S. coast
Cape Wind’s Gordon may soon get the O.K. to build turbines Stephan Savoia/AP photo

Wind farms are springing up in Midwestern fields, along Appalachian ridgelines, and even in Texas backyards. They're everywhere, it seems, except in the windy coastal waters that lap at some of America's largest, most power-hungry cities. That's partly because the first large-scale effort to harness sea breezes in the U.S. hit resistance from an army led by the rich and famous, waging a not-on-my-beach campaign. For almost eight years the critics have stalled the project, called Cape Wind, which aims to place 130 turbines in Nantucket Sound about five miles south of Cape Cod. Yet surprisingly, Cape Wind has largely defeated the big guns. In a few months it may get authorization to begin construction. Meanwhile, a string of other offshore wind projects is starting up on the Eastern Seaboard, in the Gulf of Mexico, and in the Great Lakes.

Much of the credit—or blame—for this activity goes to Jim Gordon, the man who launched Cape Wind in 2000. His goal is to provide up to 75% of the electric power on Cape Cod, Nantucket, and Martha's Vineyard by tapping the region's primary renewable resource: strong and steady offshore breezes. He has methodically responded to every objection from Cape Cod property owners and sometime-vacationers, ranging from heiress Bunny Mellon and billionaire Bill Koch to former Massachusetts Governor Mitt Romney and Senator Edward M. Kennedy (D-Mass.). "This is like trying to put a wind farm in Yellowstone National Park, as far as we're concerned," says Glenn Wattley, CEO of the Alliance to Protect Nantucket Sound, the opposition's lobbying arm.

Since 2000, Cape Wind's Gordon has burned through $30million of his own wealth, much of it to pay for studies of the site. The result is a four-foot-high stack of environmental reports, including three federal applications looking at the wind farm's potential impact on birds, sea mammals, local fishermen, tourism, and more. "We've gone through a more rigorous evaluation process than any prior energy project in New England," says Gordon, who built natural-gas-fired power plants before starting Cape Wind.

Victory is by no means certain. Cape Wind could yet bog down in litigation or be nixed by the feds, Gordon concedes. Even if Washington O.K.'s the project, he must find a way to finance it. Expected costs have more than doubled in the last eight years, to over $1.5billion, by some estimates. And assuming the funding comes through, engineering and construction could drag on for three or more years.

Regardless of how this all plays out, Gordon has secured his spot as one of U.S. wind power's pioneers. When it comes to building natural gas and oil rigs in federal waters, energy companies must follow clear government rules. But until Cape Wind floated its first proposal, Washington had never spelled out how to develop an offshore wind farm. Gordon's plan prodded the Minerals Management Service, the federal agency that oversees energy extraction from public lands, to take action. The regulators hope to release detailed rules for utilizing wind, wave, and tidal power by yearend, at which point the path will be cleared for applications from a dozen or so wind projects in federal waters, with nearly as many under way in state areas. "We'll see an incredible flurry of proposals to tap ocean resources for clean and renewable energy," says Maureen A. Bornholdt, program manager at the MMS's Office of Alternative Energy Programs.

It's easy to understand why entrepreneurs are rushing in. Winds at sea blow stronger and more steadily than on land, where they are slowed by forests, hills, and tall buildings. Unlike terrestrial winds, sea breezes also tend to keep blowing during the hottest times of the day, when the most power is needed. Within a few miles of much of the U.S. coastline, in almost any direction, wind resources are more abundant and dependable than anywhere outside the Great Plains. Exploiting this resource could supply about 5% of all U.S. electricity by 2030, says the National Renewable Energy Laboratory.

Putting turbines in open water is not a cheap proposition. It costs up to twice as much as in rural expanses. But the economics still work well in the Northeast, where open land is scarce, electricity is pricey, and demand for power keeps surging as populations swell. The Northeast is heavily dependent on electricity from natural gas, which has doubled in price in the past year. What's more, most state governments in this region have passed laws dictating that a growing share of power must come from renewable resources. These states "have to build offshore," says Bruce Bailey, president and CEO of AWS Truewind, which assesses wind resources. "They won't be able to meet their [renewables goals] if not."

In Hull, Mass., a faded Victorian-era beach town just across the bay from Boston, there's already a windmill spinning above the local high school and another over the dump. Four more turbines are planned for the waters just a mile and a half from one of Greater Boston's busiest public beaches. Thanks to the two functioning windmills, power rates in the town haven't risen in seven years, although they've doubled statewide. With four more, Hull could meet all of its needs with homegrown energy, says town manager Phil Lemnios.

Throughout New England, shrunken shipbuilding and fishing towns have begun to view offshore wind power as a source of investment and jobs. In Rhode Island, a consortium of fishermen is vying with Bluewater Wind, a unit of wind-farm developers Babcock & Brown (BNB), to put turbines in state waters near Block Island. Across the region, planners hope to reanimate shipyards by building not just turbines and foundations but also the specialized ships needed to transport and erect supersized towers and blades. In Delaware, Bluewater Wind has a project in development that could produce as much as 600 megawatts 12 miles from Rehoboth Beach; it scored an industry first in late June, when it inked a long-term contract to supply electricity to Delmarva Power. Bluewater's project may well become the first functioning offshore wind farm in North America.

The shores of the Great Lakes, with their strong winds and shallow waters, are also luring developers. Cleveland is among a handful of cities planning wind farms. With offshore wind as a driver, the Rust Belt city wants to remake its waning industrial base into a launchpad for green energy projects.

Down in the Gulf of Mexico, a consortium of oil-and-gas-industry veterans has leased tracts stretching from Galveston, Tex., to the Mississippi Delta to develop offshore wind. Their startup, Wind Energy Systems Technology, plans to adapt retired oil rigs to cut the cost of building offshore plants to a fraction of current prices, says CEO Herman J. Schellstede. The rigs also let them site the turbines farther out at sea. Today's offshore windmills are built on gigantic steel tubes bored into the seabed. It's a proven approach, but it demands a lot of costly steel and can't go too deep. Moving farther offshore on rigs allows developers to tap stronger winds—and the turbines are out of sight.

Europe is some 15 years ahead of the U.S. in exploiting offshore wind. Hundreds of giant windmills already dot the North Sea, with more than 1,000 megawatts of generating capacity. This head start provides an edge to equipment suppliers such as Denmark's Vestas Wind Systems and Germany's Siemens (SI), the only two companies building offshore turbines in large volumes today. By 2020, Europe hopes to generate a quarter of all its electricity offshore.

As wind farms are moved into deeper water, they can take advantage of the oil sector's offshore drilling knowhow, says John Westwood, CEO of Douglas-Westwood, a London-based market analyst that focuses on offshore energy. The U.S. has decades of expertise in this area, he adds. Schellstede's company, for example, is looking at a new design that adapts multilegged platforms from the oil business. These rigs could be stable enough to withstand a hurricane and would use less steel than the current generation of coastal wind farms.

Back in Cape Cod, the talk is all about deep water, too. In June, real estate agents, marina managers, and property owners met at a Chamber of Commerce breakfast to discuss the latest proposal. BlueH Technologies of the Netherlands has dreamed up a project roughly the size of Cape Wind but over 30 miles out to sea, in depths of 160 feet. BlueH is testing a design with novel two-bladed turbines that uses floating windmills chained to huge anchors. The company faces years of costly development. Still, the region's die-hard opponents of Cape Wind have embraced the plan as a better solution for Cape Cod. In a decade or so, those foes may find themselves enjoying ample supplies of green power from not one, but four or more offshore farms.

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