Maine Gov. Janet Mills approved on Thursday a bill to authorize and fund the construction of a port on the coast of Maine that will eventually serve as the onshore construction site for multi-billion dollar plans to erect wind turbines in the Gulf of Maine.
Supporters of the wind port project hope that it will facilitate the construction of gigantic floating wind turbines that will produce 3,000 megawatts (MW) of electricity.
The new law will create the “Maine Offshore Wind Renewable Energy and Economic Development Program,” the “Offshore Wind Research Consortium,” and the “Offshore Wind Research Consortium Fund.” It will also create an Advisory Board for the consortium.
Much of the specifics of how the offshore wind project will unfold have been left to the rule-making authority of state lawmakers, and concrete information about the likely costs of the project — both in terms of higher electricity rates and taxpayer-funded spending — are not available.
Lawmakers and Gov. Mills approved of the project without knowing how much electricity from the future wind turbines will cost Mainers.
The fiscal note associated with the bill captured only a small share of administrative expenses, and none of the promotional documents the Mills Administration has published articulate the full cost to taxpayers. Much of the funding will come under already-passed federal spending bills, the Mills Administration has said.
Since the turbines that will be constructed at the port will not be operational for several years, developers cannot enter into long-term power purchase agreements because they can’t estimate what price per kilowatt-hour will make the projects financially feasible.
That’s because developers cannot confidently predict the overhead costs, like materials and labor, that far into the future.
The price per kilowatt hour associated with such a power purchase agreement will be a key factor in incentivizing would-be developers to take on the herculean construction project.
Although backers of the offshore wind project claim the electricity will be competitively priced, it’s almost certain to produce electricity that is more expensive for residents and businesses than the power that comes from natural gas or nuclear power plants, especially when massive state and federal subsidies are taken into account.
In Massachusetts, for example, Avangrid, the parent company of Central Maine Power, recently paid $48 million to get out of an offshore wind power purchase agreement. The company said various factors meant that the project was no longer viable without price increases.
That raises the question of whether the cost-benefit analyses the Mills Administration and its partners in the offshore wind industry have performed over the past three years are also no longer viable.
Some environmentalists see the increased costs to taxpayers and ratepayers as a necessary part of lowering Maine’s carbon emissions and thereby reducing global temperatures.
But environmental goals aren’t the only reason businesses and left-wing activists lined up to support the project — there are also billions dollars in government spending and private investment up for grabs.
According to the state’s offshore wind roadmap, it’s expecting more than $1 trillion in worldwide offshore wind spending by 2040.
The lion’s share of the initial work and cost associated with the offshore wind program will go into building the port facility, which will include four construction terminals that can be leased out by developers.
The Maine Offshore Wind Roadmap, a promotional document created by the Governor’s Energy Office, calls for $8 billion in spending on the port, though it doesn’t break out how much of that would come from state coffers rather than the federal government.
The authors of the roadmap claim that Maine stands to secure $109 billion in private investment from offshore wind projects.
The Offshore Wind Port Advisory Group (OSWPAG), a commission created to advise the state on offshore wind development, has considered sites in Eastport and Searsport as potential locations for the port.
The roadmap claims hiring for offshore wind in the U.S. will create between 12,300 and 49,000 full-time equivalent jobs, though it’s unclear how many of those will be based in Maine.
Whether the jobs associated with the construction of that port would go exclusively to politically connected unions, like the AFL-CIO, was one of the key disagreements during legislative debate over the proposal. While far left Democrats wanted all of those jobs to go to union shops, Republicans and even Gov. Mills wanted to ensure that prioritizing union jobs didn’t end up benefiting primarily out-of-state workers.
Maine’s largest construction companies are all employee-owned and not unionized. Most of them lobbied publicly and privately against language in the original bill that would have required Project Labor Agreements (PLAs) and Labor Peace Agreements (LPAs) for the construction of the port and projects that utilize it once it’s finished.
Those construction companies said that if the law required unionization, they would likely refrain from bidding on it. That includes Reed & Reed, a construction company that has built the majority of Maine’s onshore wind turbines. The end result, they argued, would be that the economic benefits generated through the project would flow primarily to out-of-state union workers.
Although the final wind port law does not contain language about PLAs or LPAs, the compromise legislation was favorable enough to labor interests that the head of the Maine AFL-CIO called the law a “home run.”
“This bill is a homerun for Maine workers and our clean energy future. It ensures that we will create thousands of good union jobs with great benefits and apprenticeship training opportunities,” said Matt Schlobohm, executive director of the Maine AFL-CIO.
Less than 10 percent of Maine workers belong to a union.
But the labor union bosses are politically connected and are traditional allies of Democratic politicians.
The final version of the bill approved by Mills will require that 50 percent of the workers employed in the construction of the port belong to unions.
The bill also requires that awards for the project must be administered in a manner that will “maximize” the hiring of Maine residents.
If contractors and subcontractors working on the port construction project can’t find enough workers from Maine, they can then hire people from the “New England region,” and if that still doesn’t work they can use “any means necessary.”
There were only 42 MW of offshore wind in operation in 2022 in the U.S., according to the federal government.
That included 30 MW off the Rhode Island coast and 12 MW off of Virginia.
The wind turbines will be erected not in Maine waters, which extend 3 miles from shore, but in federal waters. That places them in water so deep that anchoring them firmly to the sea bed, like an oil platform, is less feasible than using floating turbine technology developed in part by researchers from the University of Maine.
The roadmap said that there are no floating turbines currently in operation anywhere on the planet, though more than 100 such projects are in development.
The Biden Administration has made offshore wind power development a top priority in federal spending bills.
The U.S. Department of Energy (DOE) said in 2022 that 40,083 MW worth of offshore wind power projects were at some stage of development.
According to DOE, the vast majority of those projects are currently in planning, site control, or permitting stages.
In addition to labor concerns, the project has also met resistance from Maine’s fishermen and lobstermen, who fear that the unprecedented at-sea construction project will disrupt the ecosystem of the Gulf.
The bill attempted to address those concerns by creating incentives for developers to avoid placing turbines in top lobster fishing waters.
Unlike some offshore wind installations, the proposed Gulf of Maine turbines are supposed to float rather than being anchored to the seabed; however, the construction of the turbines will still heavily disturb aquatic habitats.
In Rhode Island and New Jersey, a series of whale deaths in recent years has stoked concerns over whether the massive turbines are threatening endangered marine species, like the right whale.
Under the new law, federal lease sales will be executed next year and the state will begin soliciting proposals from developers in 2026.
