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Monumental Off-Shore Wind Solicitations, Multi-Port Strategy Requirement And Millions In Public-Private Funding

Source: 
Mondaq Business Briefing

In July, New York Gov. Andrew M. Cuomo announced the most ambitious combined clean energy solicitation in the United States.1 As such, the New York State Energy Research and Development Authority (NYSERDA) issued the largest offshore wind solicitationin the nation's history. This solicitation seeks up to 2,500 megawatts (MW) of projects and includes a multi-port strategy and requirement for offshore wind generators to partner with New York ports, the Combined Solicitation. The Combined Solicitation surpasses New York's initial offshore wind projects, Empire Wind and Sunrise Wind, which at the time represented the top renewable energy procurement in the U.S. at almost 1,700 MW.

The Combined Solicitation permits public-private partnership bids that combine offshore wind generation projects with investments in New York ports to support offshore wind generation. This innovative solicitation model is anticipated to further the development of New York's offshore wind projects, while simultaneously benefitting its economy, creating employment opportunities for New Yorkers and establishing New York as the center for offshore wind supply chain. This announcement, coupled with critical siting reforms in the enacted budget, demonstrates a comprehensive acceleration of action towards achieving New York' state mandate to secure 70 percent of the state's electricity from renewable energy by 2030.

Eleven ports were preselected and are located from Long Island to the Capital Region. These sites, now eligible to partner with offshore wind developers for up to $400 million in public and private sector funding for direct use in advancing an offshore wind project and the long-term industry, have the potential to support various supply chain end uses such as staging, installation, manufacturing, operations and maintenance.

Bids for this combined offshore wind and ports solicitation are due Oct. 20, 2020, and awards and contracts are expected to be executed in the fourth quarter of 2020, respectively.

Three organizations will facilitate the Combined Solicitations:

  • NY Green Bank, a state-sponsored, specialized financial entity working with the private sector to increase investments into New York's clean energy markets
  • Empire State Development, the umbrella organization for New York's two principal economic development public-benefit corporations: the New York State Urban Development Corporation and the New York Job Development Authority
  • New York State Department of Transportation, the New York governmental entity responsible for the development and operation of highways, railroads, mass transit systems, ports, waterways and aviation facilities

The organizations will disperse $400 million in private and public funding:

  • $100 million in Empire State Development grant funding
  • $100 million in low-interest financing
  • $200 million in private-sector matching funds for a 1:1 public-private match

As another novel component, bidders will be allowed to use the Index REC contract structure, which provides greater flexibility for financing and operating needs.

Through the implementation of aggressive initiatives such as the Combined Solicitation, New York has taken the lead nationally in offshore wind developments. Continued efforts to set itself apart with innovative approaches will undoubtedly position the state as the U.S.'s preeminent offshore wind hub.

Footnote

1. In their entirety the solicitations seek a maximum of 4,000 megawatts (MW) of renewable energy capacity. (Nonetheless, the emphasis here is on offshore wind component of the solicitation). Please see the New York State Energy Research and Development Authority's July 21 announcement for further information.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Ms Laura Lopez Nickerson

Holland & Knight

10 St. James Avenue

11th Floor

Boston

MA 02116

UNITED STATES

Tel: 6175232700

Fax: 6175236850

E-mail: Kristin.vasilj@hklaw.com

URL: www.hklaw.com

 

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