In the latest challenge for the offshore wind industry, New York authorities on April 19 canceled the results of an offshore wind solicitation provisionally awarded in fall 2023, citing wind turbine maker GE Vernova Inc.'s decision to halt production of a larger wind turbine that winning bidders had planned to use to lower their projects' overall price tags.
The New York State Energy Research and Development Authority (NYSERDA) made the announcement in a press release, explaining that "material modifications" to the projects bid into the state's third offshore wind solicitation in October 2023 caused "technical and commercial complexities" between the provisional awardees and their partners.
This left the provisionally awarded companies unable to come to terms, with the winning bids now to be rescinded, the agency continued.
The cancellation marks the latest blow to the industry's progress in the Northeast US after Danish energy giant Ørsted A/S announced in late October 2023 that it was canceling two large projects located in the swath of ocean between New York and New Jersey known as the New York Bight.
Ørsted opted to pull out of the projects due to supply chain challenges that caused costs to soar. Supply chain problems have forced many offshore wind companies to reconsider their investments in the US, jeopardizing President Joe Biden's goal of deploying 30 GW of offshore wind by 2030.
Yet it was GE Vernova's February decision to scrap its plans to begin building the 17-MW to 18-MW Haliade-X offshore wind turbine variant that prompted the April 19 cancellation. The manufacturer said it will instead work exclusively on smaller models. GE Vernova spun off from General Electric Co. earlier in April.
Shifting to smaller turbines would have forced October's provisional winners to expand their projects with a greater number of turbines, raising operational and construction costs.
NYSERDA said GE Vernova's offshore wind turbine "product pivot away from the initially proposed 18 MW Haliade-X turbine platform to a 15.5/16.5 MW platform caused material changes to projects proposed" into the solicitation. "Given these developments, no final awards will be made, [and the solicitation] has been concluded."
The three impacted projects are the 1,404-MW Attentive Energy One Offshore Wind Project proposed by TotalEnergies SE, Corio Generation Ltd. and Rise Light & Power; the 1,314-MW Community Offshore Wind Project backed by National Grid Ventures Ltd. and RWE Clean Energy LLC; and the 1,314-MW Excelsior Wind project being developed by Copenhagen Infrastructure Partners P/S.
Although NYSERDA said it will look to advance a future competitive solicitation, the agency gave no time frame as to when that may occur. NYSERDA has also canceled GE Vernova's provisionally awarded $300 million in grant funding to ensure the money is available in a future competitive solicitation for New York's offshore wind supply chain development.
Community Offshore Wind, the joint project subsidiary for National Grid and RWE Offshore Renewables, said it will be important to have "a strong, local supply chain" with "reliable partners" in the future for a successful New York offshore wind industry to thrive. But despite the cancellation, the company said it remains committed to offshore wind in the region. The company intends to evaluate upcoming solicitations in New York and to collaborate on the state’s clean energy goals.
Attentive Energy said in a brief statement, "Attentive Energy One is a highly mature project that can deliver environmental justice and billions in economic benefits to New York. Our dedication to advancing clean energy solutions and fostering sustainable communities remains unwavering as we move forward."
New York's offshore wind goal still seen as attainable
The offshore wind industry group Oceantic Network said it was confident that New York will meet its goal of deploying 9 GW of offshore wind energy by 2035, despite the cancellation.
"We are confident New York's leadership will take the action necessary to maintain their market's trajectory," said Oceantic Network founder and CEO Liz Burdock. "The state has already shown its ability and willingness to move swiftly to secure projects on their timelines, and we fully expect the state will continue taking bold action in service of their 9-GW deployment goal."
Although the April 19 announcement is a "disappointment," Burdock expressed confidence that it will not impact the market's overall fundamentals. "The industry recently celebrated New York's first project coming online, and this summer two new commercial-scale projects begin installation with two more New York projects close behind," she added.
The Biden administration also marked a milestone April 2 of approving the construction plans for eight offshore wind projects since 2021, representing just over 10 GW, about a third of the projects needed to meet his 2030 goal.
The US Interior Department's Bureau of Ocean Energy Management says it aims to approve around 29 GW of offshore wind by the fall of 2024.