The Energy Consumer's Bulletin- a New England energy news blog

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The High Cost of Saying NO to Offshore Wind

If you’re a New Englander concerned about climate change, you’re likely anxiously awaiting the results of Massachusetts, Connecticut, and Rhode Island’s joint offshore wind solicitation. With recent supply chain and economic constraints causing project costs to rise, the three states issued a joint solicitation to allow developers to bid on larger projects and access economies of scale in October of 2023. They received the following proposals in March of this year.

Submitted to all 3 states, individually and jointly:   
Submitted to CT & RI, individually and jointly:   

The states are now reviewing the proposals and are expected to make conditional selections on August 7th and to execute contracts in October. Each state could choose to select one or several projects up to their requested solicitation size. RI requested 1,200MW, MA 3,600MW, & CT 2,000MW, and they could split contracts/MW’s from projects between states.   

While we don’t know the New England project prices quite yet, we do know the prices in New York’s recent solicitation: $150 per MWh. While this is certainly not the same low price of projects currently being built, such as Vineyard Winds $74 per MWh or Revolution Winds $98 per MWh, this latest RFP should still result in successful contracts for offshore wind development. Offshore wind provides substantial benefits for our climate, our health, and our economy, and too much is at stake if we do not move forward with this vital resource. 


Offshore Wind is Critical for Climate & Public Health  

Both Massachusetts and Rhode Island have net-zero emissions reduction targets by 2050, and offshore wind will be the linchpin that gets us there. A Sierra Club report by Synapse Energy Economics states that in 2030, bringing 9,000MW of offshore wind online would reduce ISO New England’s carbon dioxide emissions from electricity generation by 14 million short tons annually, a 42% reduction in annual CO2 emissions from the electricity grid. The substantial benefits of these avoided emissions add up to a social cost of carbon value of $3.5 billion. Further, these avoided emissions will also result in reduced pollutants, which, according to Synapse, will represent an annual public health benefit of approximately $362 million.

Block Island Wind Tour - offshore wind - ELM - Chris Bennett Photography

Block Island Wind Tour, Chris Bennett Photography


Offshore Wind’s Potential Ratepayer Benefits

Modeling the recent NY prices of $150.14 per MWh, Synapse found that offshore wind may reduce New England customers’ electricity bills by $2.79/month to $4.61/month, depending on the natural gas price scenario modeled.  

How exactly can offshore wind lower electric bills?

The answer is price suppression. In the wholesale energy market, electric generators bid to provide electricity based on their operating costs. For fossil fuel generators, this mainly includes fuel costs. Offshore wind plants, having no fuel costs, bid at nearly zero. The regional grid operator prioritizes generators with lower costs, like wind, over more expensive ones, like natural gas. The market price for electricity is set by the cost of the last generator needed to meet demand. As offshore wind generation increases, it reduces the need for expensive natural gas generators, lowering overall electricity prices, otherwise known as price suppression. This effect is also produced by solar power, energy efficiency, and demand response. Source: Sierra Club/Synapse Report 


Figure 3 offshore wind blog

Source: Sierra Club/Synapse Report 


Offshore Wind Boosts the Local Economy & Protects Against Fossil Fuel Price Volatility  

In the wake of Russia's invasion of Ukraine, power prices surged. New England, in particular, felt the pinch, with rising LNG costs exacerbating the situation. This is because the price of electricity is closely tied to the cost of the natural gas fuel used to generate electricity, as shown in the figure below.


Figure 2 offshore wind blog

Source: ISO New England, Key Grid and Market Stats, April 2024. Available at


Therefore, the region's dependence on LNG underscores the risks associated with relying on volatile global markets, where geopolitical tensions can send shockwaves rippling through local economies. Offshore wind, on the other hand, presents a viable alternative, offering a stable, local source of energy that mitigates reliance on costly imports. That same Synapse report found that bringing 9GW of offshore wind online by 2030 would keep an average of $3 billion annually in the region. Investments in fossil fuels are something you’re not getting back, whereas offshore wind invests in the local workforce.  


Offshore Wind is Key to Weathering Winter Reliability Challenges 

Unlike traditional power plants, offshore wind projects perform exceptionally well in cold weather conditions as their energy supply naturally increases during extreme cold snaps. The windiest time of day aligns closely with peak demand periods, which are usually in the evening. Analysis from the Union of Concerned Scientists shows that increasing offshore wind power significantly reduces the risk of winter electricity blackouts by offsetting high demand during cold snaps. With Vineyard Wind now connected to the grid and Revolution Wind soon to follow, the region will experience firsthand the benefits of large-scale offshore wind projects ramping up production during peak demand periods in winter. ISO-NE predicts a significant increase in wintertime electricity demand over the next decade, attributable to the widespread adoption of heat pumps, making solutions for winter reliability, such as offshore wind, crucial. 


Lessons from the Aquidneck Island Gas Shortage

The winter of 2019 served as a stark reminder of the vulnerabilities inherent in relying solely on natural gas. The shortage experienced on Aquidneck Island underscored the fragility of supply chains and the need for diversified energy sources. Offshore wind presents a solution, offering a reliable alternative that doesn't depend on the vagaries of natural gas. 


Offshore Wind is Imperative 

Offshore wind offers significant advantages for our climate, health, and economy. With so much at stake, it is imperative that this latest solicitation result in the continued responsible development of offshore wind.