Stoel Rives’ attorneys Cherise Gaffney, Tim Taylor, Chad Marriott and Viet Nguyen co-authored an article for Wind Systems magazine titled “Offshore wind’s westward expansion,” published September 15, 2019. The article discusses some of the challenges that will face developers who are looking to California and the West Coast as the next location for large-scale deployment of offshore wind resources in the U.S.
The first wave of development of offshore wind resources has been focused in the East Coast of the U.S., but California’s large economy, power-hungry populace, extensive coastline and progressive politics make the state a likely place to lead the next round of development in offshore wind installations.
Challenges for developers include:
- Project financing for offshore wind will continue to evolve over the next five to 10 years. Unless the U.S. Congress amends existing law, the wind industry likely won’t be able to rely on the federal tax credits — the production tax credit (PTC) and the investment tax credit (ITC) — available to wind power developers on land. “Without the PTC or ITC, the gap fillers will likely be term debt and equity partnerships akin to some of the recently announced joint ventures, such as Engie-EDP, Ørsted-Eversource, and EnBW North America-Trident Winds,” the authors write.
- The need to approach the federal, state and permitting process strategically — understand the approval process and requirements, know the best available science regarding potential project impacts, and engage early with relevant resource agencies regarding potential monitoring and mitigation measures.
- Obtaining approvals from California resource agencies with purview over activities within the state’s coastal zone and over its submerged public trust lands, and obtaining appropriate environmental reviews under the California Endangered Species Act and California Environmental Quality Act.
The authors conclude: “California almost certainly will be the next hot spot for offshore wind development. As project sponsors move into California, they will need to carefully consider the financing, regulatory, and permitting issues that arise — some of which will be familiar and others that will be unique to the waters of the Pacific Coast.”