New York State cancels 3 large offshore wind projects, plans to seek new bids

New York State has unexpectedly hit the brakes on three large offshore wind projects it awarded last year for the waters between Long Island and New Jersey, citing “technical and commercial complexities” with a turbine manufacturer.

The decision to nix the three projects comes atop months of hard knocks for the nascent U.S. offshore wind industry and poses big challenges for New York’s plans for some 9,000 megawatts of the green energy by 2035, including the state’s plan to subsidize the manufacture of turbines in New York.

The industry had already been beset by soaring costs for turbine materials and rising interest rates, leading to canceled projects in New Jersey, New England and Maryland. Overseas wind-energy developers have taken billions of dollars in impairment charges reflecting the lower value of the projects.

The three newly canceled New York projects, known as Community Offshore Wind, Excelsior Wind and Attentive Energy One, represented just over 4,000 megawatts of that plan — nearly half the state’s goal.

Officials blamed a decision by manufacturer GE Vernova to cancel its plans to make the largest turbines on the market, at 18 megawatts each.

GE Vernova’s “pivot away from the initially proposed” 18 megawatt turbines “caused material changes to the projects,” the New York State Energy Research and Development Authority said, and led the state to conclude that “no final awards will be made.”

On the heels of Friday’s announcement, NYSERDA, which has been administering the awards, said Tuesday it would open a new “request for information” in advance of a new offshore wind bidding process.

“We are undaunted in our efforts to build this industry with a thoughtful, collaborative approach that is responsive to market needs and inclusive of robust stakeholder engagement to ensure a solid foundation for success,” NYSERDA chief executive Doreen Harris said in a statement.

New York had already scrambled to keep active two other previously awarded rounds of ventures, for projects known as Empire Wind, Sunrise Wind and Beacon Wind. A hastily organized solicitation, concluded in February, put Sunrise Wind and half of the Empire project, known as Empire Wind 1, back into active status — both have begun onshore infrastructure work — but left uncertain the fate of Beacon Wind and Empire Wind 2, with power set for Long Island.

GE Vernova and partner LM Wind Power had been expected to construct a turbine parts manufacturing facility in the state, with $300 million in funding from New York. Now, the state said, that grant funding “will be made available through a future competitive solicitation to continue the development of the offshore wind supply chain in New York.”

A GE Vernova spokesman didn’t respond to a request for comment.

Andrew Doba, a spokesman for Vineyard Offshore, which is developing the Excelsior Project, said NYSERDA’s decision to withdraw the provisionally awarded contracts was “warranted given GE Vernova’s failure to follow through on their commitment to deliver an 18 megawatt machine.” He said Vineyard will work with the state to “advance the next solicitation process in NY.”

So far, the only working commercial offshore wind project in the country is South Fork Wind, a project by the Long Island Power Authority spearheaded by former LIPA chief Tom Falcone. The 12-turbine project, which was not administered by NYSERDA, is sending its power to the South Fork of Long Island.

Falcone unexpectedly resigned last month, just days after Gov. Kathy Hochul threw a ceremonial switch for the South Fork project. He was replaced by John Rhodes, a former NYSERDA chief executive and Public Service Commission chairman, who became LIPA’s interim chief executive.

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.