Gov. Paul LePage’s wish has come true.
A multinational corporation with a market capitalization of more than $70 billion that was interested in doing business in Maine — potentially making the state a hub for an evolving industry — has abandoned its plans to do business here.
It sounds ironic, given how often the Republican governor expresses his frustration that Maine doesn’t attract more industry and his oft-repeated motto, “Capital investment goes where it is welcomed and stays where it is appreciated.”
But that essentially sums up LePage and his relationship to Statoil. The Norwegian energy giant said this week it would abandon its plans for a pilot offshore wind energy project in Maine. Now, the company plans to set up the project in Scotland. It also wants to keep its options open in the U.S., but not in Maine.
The Maine Public Utilities Commission in January granted Statoil initial approval under the state’s Ocean Energy Act to moor four floating turbines off the coast near Boothbay Harbor to generate 12 megawatts of energy. The approval paved the way for a contract that would allow the company to benefit from the support of Maine electric ratepayers — to the tune of $200 million over 20 years — while it refined its technology for the market.
While Statoil was the only company to respond to the PUC’s request for proposals for a deepwater, offshore wind energy demonstration project before the deadline more than two years ago, LePage decided to change the rules midstream in an attempt to undermine Statoil’s potential investment.
The governor railed against the arrangement from the start, understandably making Statoil unsure about its interest in doing business in Maine. Privately, LePage’s administration contemplated ways to void Statoil’s deal with the PUC. Then, during the spring legislative session, LePage predicated his support for comprehensive energy legislation — which contained elements he proposed — on the condition that lawmakers order the PUC to reopen the bidding process to allow a venture led by the University of Maine to submit a competing offshore wind energy pilot project proposal.
We hope LePage hasn’t squandered Maine’s chance to become a hub for the evolving offshore wind energy industry — an industry that Maine has a legitimate shot of cultivating. For the moment, it’s up to the University of Maine and its partners — Maine-based construction giant Cianbro and Emera, owner of Bangor Hydro Electric Co. — to prove he hasn’t.
The university-led venture, Maine Aqua Ventus, must now prove it has the financial backing needed to pull off a full-scale demonstration project. (The university currently has a one-eighth scale model of a turbine moored in Penobscot Bay near Castine.)
To address LePage’s chief complaints about Statoil’s venture, it’s also up to Maine Aqua Ventus to require a smaller subsidy from Maine ratepayers and deliver a greater economic return to the state than Statoil could. That return would come in the form of jobs at Maine companies contracted to build the turbines and workforce training in an emerging field. The public could have a better idea of the university’s capacity to pull it off at the end of the month, when it must make information about its proposal public.
LePage objected to the prospect of Maine ratepayers subsidizing an experimental technology long-term. But if Maine wants a shot at becoming a hub for an industry whose output becomes a major part of the nation’s future energy mix, the state should be prepared to play a role — though not an exclusive one — in helping to pay for the research and development involved.
In 1976, the federal government funded the Eastern Gas Shales Project, awarding grants to a number of universities and gas companies to develop and test new fracturing and drilling methods. If it weren’t for that significant government investment in new technologies, the natural gas boom the nation is experiencing today wouldn’t be happening. The state at the epicenter of today’s oil and gas boom, North Dakota, probably wouldn’t have the nation’s lowest unemployment rate in the nation and the fastest job growth.
Today, the University of Maine-led offshore wind venture is in the running for similar federal investment — tens of millions of dollars in funding from the U.S. Department of Energy to allow it to continue refining its technology and making it commercially viable. Investment on the state level would improve the university’s chance of securing the federal money.
If the university-led venture can make it work, let’s hope LePage doesn’t change his mind — and the rules — regarding that investment midstream.