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Maryland Offshore Wind FAQ

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Document provided by Chesapeake Climate Action Network (CCAN), courtesy of Tom Carlson, CCAN Director.

Presentation scheduled 8/17 12pm-2pm at St. Michael the Archangel School, 10 Willow Ave., Overlea, MD 21206.

Event flyer posted here: http://www.slideshare.net/ofbpa/borwn-bag-lunch-meeting-august-2011

Published in: Business, Technology
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Maryland Offshore Wind FAQ

  1. 1. Maryland Offshore Wind: Frequently Asked QuestionsHow many jobs will offshore wind power create?Developing 500 MW of offshore wind power for Maryland over the next five years could create 2000jobs for manufacturing and construction and 400 permanent jobs for operations and maintenance.Further development of offshore wind power will lead to more jobs for years to come. The UnitedSteelworkers in Maryland, Baltimore Building and Construction Trades Council, the Sheet MetalWorkers of Maryland, and the Maryland AFL-CIO all supported the bill for its job creating potential.Why is offshore wind power essential to Marylands clean renewable energy future?According to the Maryland Energy Administration, offshore wind is the states only natural resourceplentiful enough to meet our renewable portfolio standard of 20% by 2022.How much electricity can Maryland generate from offshore wind power?A 500 MW project would supply enough electricity to power 79% of all the homes on the EasternShore of Maryland, or more than half of the homes in Baltimore City. With current technology,offshore wind power could meet more than one-third of our regionʼs need for electricity. The capacityof offshore wind power will become even greater with advances in technology. It has the potential toproduce the equivalent of two-and-a-half times Marylandʼs current electricity load.How will offshore wind power help reduce global warming pollution?By displacing fossil fuel pollution, a 500 MW offshore wind project will reduce emissions of thegreenhouse gas, CO2, by 945,000 tons per year. This is the equivalent of taking nearly 200,000 carsoff the road. With 3,000 miles of shoreline and ample farmland, Maryland is particularly vulnerable tothe effects of climate change from sea level rise to more extreme weather events, increasing ourneed to move to clean energy.How will offshore wind power affect the health of Maryland residents?By avoiding harmful emissions from fossil fuels, a 500 MW offshore wind park off the coast ofMaryland will save 20-30 lives and $160 million in public health damages every year. Over a 25-yearcontract, the park will save 700 lives and $4 billion in avoided health costs.In addition, the Army Corps of Engineers found that the 468 MW offshore wind park planned forMassachusetts will prevent 5,000 asthma attacks and 200 emergency room visits every year.
  2. 2. Is offshore wind power reliable, even though the wind isnʼt always blowing?Offshore wind parks provide a local source of electricity and improve the reliability of the electricitysystem as a whole.1 European nations have demonstrated that it is possible to shift 20 percent ormore of their power generation to wind without adverse effects on the reliability of the electric system.Will the windmills be visible from the beach?The Department of Interior accepted recommendations from Marylandʼs Department of NaturalResources to open offshore blocks for leasing at least ten miles off the coast of Ocean City and 20miles off the coast of Assateague Island.2 At this distance, the turbines will be barely visible, if at all,from the shore.3How will offshore wind power impact my electricity bills?Based on a comparable offshore wind project in Delaware, the Public Service Commission projectsthat offshore wind will cost the average Maryland ratepayer $1.44 per month in 2016 and go downfrom there. This amount can be saved by replacing two 60-watt light bulbs with more efficientcompact fluorescents. From 1999 to 2009, Maryland energy bills tied to volatile fossil fuels roughlydoubled. Offshore wind power offers reliable prices as the fuel (wind) is free and the rate can belocked in over a 25-year period.4Will investing in offshore wind power be good for Maryland business or create jobs?The economic impact of offshore wind expands well beyond direct jobs for developing and operatingthe park. Based on a regional employment model analysis by the Maryland Department of Business &Economic Development (DBED), the total economic impact of offshore wind over five years is morethan $1.9 billion, 8,200 job-years and $14 million in state tax revenues. Offshore wind developmentwill put people to work, encourage further investment in the state, and improve the quality of life ofMarylanders by reducing health costs.While interstate commerce law forbids Maryland from requiring that all offshore wind turbine partsread "Made in Maryland," the legislation encourages local development and in-state jobs in a numberof ways. As only projects that connect to the distribution grid of the Delmarva Peninsula will beconsidered, this limits feasible options to connecting in Maryland or Delaware. The legislation alsodirects the Public Service Commission to favor projects that benefit Marylands electric grid and thosethat will create the most net benefits for Maryland workers and businesses (including small andminority owned enterprises).Will offshore wind turbines affect birds and/or marine life?A 2010 study by the Stockholm University Zoology Department found that properly sited offshorewindmills do not harm marine life, instead encouraging more marine life because artificial reefs format their foundations.5 Studies over the past two decades in Europe have found that properly sitedoffshore wind parks have no significant impact on migratory or shore bird populations.6 Utilizingoffshore wind power will also avoid global warming pollution, which is the most pressing danger tobird and marine life, causing sea level rise and the destruction of wetland habitats for birds and otherwildlife in Maryland. 7
  3. 3. How does the Maryland Offshore Wind Energy Act ensure Maryland ratepayers are protected?The PSC will reject any bid that they project to cost $2.00 extra per month for the average ratepayer(1000 kw/hr per month usage) or 2.5% extra for nonresidential ratepayers. Also, the PSC will onlyconsider proposals that are similar in price to the Delaware and Massachusetts contracts for offshorewind energy. These provisions ensure ratepayers are protected in our states initial moderateinvestment in offshore wind power. During a work group on the bill in 2011, PSC Chairman DougNazarian stated that he believed the bill did everything possible to control costs for ratepayers.How does the $2.00 rate projection cap work?When reviewing proposals, the PSC will project how much ratepayers will pay to invest in offshorewind power. This rate impact projection is based on the difference between the expected price offossil fuels and the price of offshore wind agreed to in the contract. While the price of offshore windagreed to in the contract will be stable for 25 years, the price of fossil fuels may vary from theprojection. In fact, from 1999 to 2009, the cost of energy to Marylanders roughly doubled.If fossil fuel prices end up being lower than projected, Maryland will pay slightly more for offshorewind power comparatively, but less overall on their bills. In this scenario, Marylanders will be payingless for energy than they are today as most of their energy bill will still be derived from fossil fuels atlower-than-projected prices.If fossil fuel prices are higher than projected, then Maryland will pay less for offshore wind powercomparatively. In fact, due to the billʼs provisions, Marylanders will receive a rebate once the price offossil fuels becomes higher than the price of offshore wind. Hence, in any scenario, the rateprojection cap ensures that Maryland ratepayers are protected.Will renewable energy development create net positive employment?According to the National Renewable Energy Laboratory, the European Union found that realizing a20% renewable energy standard (RES) by 2020 would provide a net effect of about 41,000 additionaljobs and 0.24% additional gross domestic product (GDP).8 Recent research has found "that it is onlywhen conventional energy prices are forecast to be very low that net employment impacts from[renewable energy] are negative."9Has wind power reduced emissions in real-world electricity systems?The most recent report from the U.S. Department of Energyʼs (DOE) Energy InformationAdministration (EIA) states that “increased wind-based generation since 2000 was responsible forabout 39 million metric tons of avoided emissions in 2009 relative to electricity supplied at theaverage emissions rate.”The journal, Energy Policy, found that offshore wind power produces fewer emissions over its lifecycle ((9 g CO2e/kWh) than any other power source today.10 For comparison, Nuclear averaged (66 gCO2e/kWh), natural gas (443 g CO2e/kWh), and coal (960-1050 g CO2e/kWh).11According to the U.S. Department of Energy, coal consumption fell in Denmark from 16.6 million shorttons in 1996 to 7.8 million short tons in 2008 as more wind power was brought on line.12 In the sameperiod, carbon dioxide emissions fell by over 20 million tons!13 The primary reason for the decrease inemissions was a conversion to less carbon intensive fuels and an increased use of renewable energysources, including wind.14
  4. 4. Will wind power be part of a future zero-carbon grid?While our goal right now is to reduce emissions as much and as quickly as possible, there aretechnological scenarios in which we will achieve a zero carbon grid with wind power providing part ofthe solution. As offshore wind power is a variable source, it is often combined with loadfollowing/peaking power such as natural gas. However, there are scenarios in which wind powercould be combined with other sources of energy and storage technology to obtain a zero carbon grid.The variability factor of many renewable energy technologies can be mitigated in the following ways;(1) a smart balance of sources (geothermal, tidal and concentrated solar thermal for baseload,photovoltaic solar power for energy during the day, and wind power for energy at night), (2)interconnecting geographically spread-out renewable energy sources, (3) using renewable load-following/peaking power, such as hydropower to balance demand, (4) using smart meters to chargeelectric vehicles when other energy demand is low, and (5) storing electric power for later use tobalance demand.15 These technologies are already available and are being developed further.16Wind speeds can also be forecast with more than 80 percent accuracy and are even more consistentoffshore.17Are potential decommissioning costs factored into the project?The Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE) requires thatprovisions are put in place to decommission the offshore wind project at the end of its useful life.18The cost of decommissioning is factored into the cost of energy in the power purchase agreement(PPA) or long-term contract. The options at the end of the projects useful life include: retrofitting theturbines to continue generation, taking out the turbines, or knocking down the turbines to createartificial reefs.Are distribution costs and the upgrading transmission infrastructure factored into the project?The cost of constructing and upgrading electrical interconnection facilities, electrical transmission anddelivery is also included in the power purchase agreement (PPA) or long-term contract as it was forthe current Delaware offshore wind project.19The size of the current proposed contracted project will not require new transmission projects. Downthe road, new transmission projects may be developed to move power, including from offshore wind,up and down the east coast (either onshore or an offshore transmission grid similar to the GoogleAtlantic Wind Connection proposal). These new transmission projects will need to be evaluated on acase by case basis in terms of costs and benefits.To get involved in the campaign, for further information and for citations, please visit MarylandOffshoreWind.orgor contact Tom Carlson, CCAN Maryland Director at: tom@chesapeakeclimate.org.

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