Five companies are interested in developing wind farms in the ocean off North Carolina, hoping to take advantage of what could be the East Coast’s most promising chance to create energy through giant turbines anchored to the sea floor.
The idea is embraced by Republican Gov. Pat McCrory and the Sierra Club alike, who see North Carolina as the next potential center for renewable energy in America. But big obstacles remain before the whirling farms become a reality. Offshore wind is an expensive form of energy, and Congress is losing interest in federal subsidies to encourage it. There are no offshore wind farms in the United States, although they’re common in Europe.
The federal government asked companies in December if they’d be interested in North Carolina offshore wind development. Five responded positively in filings released Tuesday. One is Virginia Electric and Power Co., part of the Dominion utility that serves Virginia and northeastern North Carolina.
“We responded we are interested, but there is a long way to go,” said Dominion spokesman Dan Genest. “We are interested. We would like to be a player. There’s a lot we have to learn, though.”
The federal government has to finish an environmental study before auctioning the offshore leases. The agency also needs to decide whether to change the areas considered for wind farms in light of newly released public comments. Those include the assertion of the World Shipping Council, a trade association that represents container vessels , that inviting wind farm proposals off Kitty Hawk, N.C., is “dangerous and imprudent” for shipping.
Two potential development areas are between Myrtle Beach, S.C., and Wilmington, N.C., while another is beyond the Outer Banks, across from the island towns of Kitty Hawk, Nags Head and Manteo. All potential areas are at least six miles from shore.
National Renewable Energy Laboratory estimates suggest that North Carolina’s offshore wind potential is the highest on the East Coast. The five companies interested in leasing did not make binding commitments or detailed proposals. But Brian O’Hara, president of the North Carolina Offshore Wind Coalition, said their responses are still a good sign wind farms will be coming.
“I’m excited to see this level of interest. This is great,” he said. ”The chances are very good. I don’t think it’s a question of if, I think it’s a question of when.”
Wind farm development is not a fast process. O’Hara said it could be at least five years before the turbine construction would begin.
“There has to be some sort of agreement for where the power is going,” he said.
That’s the roadblock, said Bruce Hamilton, a California-based wind expert with the global firm Navigant Consulting. Offshore wind is much more expensive than other sources of electricity, Hamilton said, and utilities are not going to buy it unless there’s something forcing them to do so.
He said that means a requirement such as the one Maryland is considering. The Maryland legislature is poised to pass a bill requiring the state’s electricity providers to buy a certain amount of power from a proposed wind farm off Ocean City. It would increase monthly electricity bills for ratepayers by an estimated $1.50 a month.
“Absent those kinds of specific policies, offshore wind probably won’t make the short list – at least in the near term,” Hamilton said.
North Carolina has a law saying electric utilities must generate 12.5 percent of their retail sales from renewable energy or energy efficiency by 2021. But any offshore wind production is at least several years off and could be too late to be part of that mix. Also, some Republicans in the state legislature are trying to gather the votes to overturn that renewable energy requirement.
The federal government has an investment tax credit that would pay 30 percent of the construction for offshore wind projects. But the credit will expire at the end of the year unless Congress acts. So it could be long gone by the time there’s North Carolina construction.
Other East Coast offshore wind farms have a head start on North Carolina, although they’ve run into problems. That includes a proposal for wind turbines off the coast of Atlantic City, N.J., made by Fishermen’s Energy LLC, which is among the companies to express interest in leasing waters off North Carolina.
Other companies who said they have an interest in North Carolina leases are EDF Renewable Energy, a subsidiary of a French company; Green Sail Energy of New Jersey, and Apex Wind Energy of Charlottesville, Va.
“We’re serious,” said Rob Propes, a development manager for Apex who is based in Raleigh, N.C.