Jobs, innovation: What offshore wind can do for Maine

By Wickham Skinner, George Hart and H. Allen Fernald
Posted July 21, 2013, at 3:27 p.m.

In recent days, heated outcries have been made in these pages and in other Maine media outlets criticizing the action taken by the Legislature in directing the Maine PUC to reopen the process of accepting power purchase agreement proposals for offshore wind. We write here as the founding members, with the late Matt Simmons, of the Ocean Energy Institute, which in 2007 initiated the drive to determine the technical and economic practicality of offshore wind for Maine.

From that perspective, several claims in the current uproar are at a disturbing distance from the facts.

First off, it is asserted that it’s a horrible mistake to have the state of Maine step back from what now can be seen as a bad agreement for all concerned. In 2009, when the imminent arrival of low-cost natural gas became clear to us at OEI, we stressed that to be viable, the cost of offshore wind would need to be greatly cut.

This could take a decade of research, development and demonstration programs.

The best path forward would not be to install existing expensive technologies, which could only survive with the huge subsidies present in Europe. Now what risks scuttling the future of offshore wind is not an action by the Maine Legislature but rather enforcing a 28 cent per kilowatt-hour price, which announces to the world that offshore wind is far from true commercial viability. It was a bad deal for the future of renewable energy, not to mention the ratepayers of Maine.

It was also a bad deal given what the Department of Energy is specifically trying to accomplish with this Advanced Technology Demonstration Program. The objective is progress towards commercialization with the primary goal being 10 cents per kilowatt-hour generation costs. Locking in a price almost three times as high is the wrong incentive. It would give DOE a black eye like Solyndra did.

Rather than just “sell” an off-the-shelf design, the Cianbro construction firm and the University of Maine spearheaded an effort that has been relentlessly innovative. They’ve developed an approach that gets far closer to 10 cents per kilowatt-hour through clever modular construction, dockside multi-module integration and greatly extended platform lifetime.

In this strategy, constant emphasis is placed on keeping all the high-paying platform construction jobs in Maine. There are no turbine companies in Maine and are not likely to be. But the plan is to manufacture everything else here from specially designed lightweight concrete and advanced composites. This addresses a key reality that Mainers need to focus on and that OEI has always given top priority: the creation of good manufacturing jobs in Maine.

 

If an offshore wind system is made from steel there may be some final assembly done in-state, but the overwhelmingly the manufacturing will be done elsewhere, most likely overseas. Maine shipyards are simply not designed to compete with $3-per-pound Korean steel ships. The most sophisticated ships in the world are built here and thus end up costing about $7 per pound. But offshore wind platforms are large relatively “dumb” structures. The jobs dimension of this issue is vital.

Cianbro knows how to build huge structures from steel or concrete and knows how to do it in Maine. Iberdrola, the international energy conglomerate, is deeply involved in an advisory role, bringing to bear its decades of expertise in European wind projects. In spite of this undeniable record of innovation and production, critics continue to deride the UMaine effort as amateurs working on an overly demanding project.

The truth could not be further from that.

At the May 31 launch of UMaine’s VolturnUS 1:8 platform, Jose Zayas, who is in charge of DOE wind and water programs, said he wished other DOE programs provided the same return on investment as the VolturnUS project. The Cianbro-UMaine proposal to DOE for the current detailed design work was one of only seven to be selected out of 70 submissions. Confirming this vote of confidence, several large international energy interests have started active inquiries into substantial investment participation.

And befitting a coastline “anchored in granite” the VolturnUS platform is built to last. The designed lifetime is 80 to 100 years to achieve large cost savings. Immune to corrosion, these platforms can be towed back to dockside and retrofitted with new state-of-the art generators every 20 to 25 years. This is much like replacing the alternator on a car rather than buying a whole new one when it wears out.

It is precisely this kind of major effort where a center of deep expertise at a university can be especially helpful across all aspects of a project. It is how a university can take the leap to lasting greatness and also set the foundation for new jobs to be created by new technologies.

Massachusetts Institute of Technology has done this many times, such as in its path-breaking role in radar at MIT Lincoln Laboratory. Raytheon and the lab have combined on many large demonstration programs much as Cianbro and UMaine are doing here.

Cost-effective offshore wind is a wise “insurance policy” for the future. But that insurance should not cost 28 cents per kilowatt hour. Refusing to pay such a high rate is not the same thing as trying to destroy renewable energy. It’s time for some Yankee common sense, thrift and ingenuity. Solid engineering achievement doesn’t always have to come “from away.”

Wickham Skinner taught operations management as a professor at the Harvard Business School for 28 years. Retiring to Maine, he served as a director of Bath Iron Works, the Natural Resources Council and the Farnsworth Museum. George Hart has been active for decades in large advanced technology development and demonstration projects at the U.S. Naval Research Laboratory, Los Alamos National Laboratory, MIT Lincoln Laboratory and the Missile Defense Agency. H. Allen Fernald is an entrepreneur and publisher serving on national and state corporate boards of directors while active in educational philanthropy. They are all founding members of the Ocean Energy Institute.

http://bangordailynews.com/2013/07/21/opinion/jobs-innovation-what-offshore-wind-can-do-for-maine/ printed on September 19, 2014