New York Announces Third Solicitation for at Least 2,000 MW of Offshore Wind – JD Supra

Governor Kathy Hochul announced the release of New Yorks third competitive Offshore Wind Renewable Energy Certificate (OREC) solicitation on July 27, 2022. Through the solicitation, the New York State Energy Research and Development Authority (NYSERDA) aims to procure at least 2,000 MW, and up to 4,640 MW, of offshore wind energy, enough to power 1.5 million New York homes. Under the New York Climate Leadership and Community Protection Act (CLCPA), New York set a resource target for offshore wind of 9 GW by 2035. The six leases recently awarded in the New York Bight alone are estimated to produce at least 5.6 GW worth of power, and it is expected that multiple New York Bight lessees will bid in New Yorks OREC solicitation.

NYSERDAs previous solicitations include contracts for 1,700 MW of offshore capacity from Equinor Wind US LLC and Sunrise Wind LLC in 2019 and 2,500 MW of offshore capacity from Empire Offshore Wind LLC and Beacon Wind LLC in 2020. The 2020 procurement also secured significant investments, totaling $644 million, in port infrastructure and local manufacturing.

A draft of this solicitation (ORECRFP22-1) was released in March 2022 for public comment, and a follow-up request for information was released in May 2022. In response, NYSERDA received over 1,300 comments from various stakeholders. The 2022 solicitation reflects consideration of these comments and includes several updates from the previous two solicitations. These updates include the following:

NYSERDA has also committed to awarding evaluation points for plans that repurpose existing downstate fossil-based electric generation infrastructure, and for projects that create economic benefits through developing energy storage and other clean energy and decarbonization investments, including pilot and demonstration projects for innovative storage projects.

Eligibility to participate in the solicitation is limited to U.S. offshore wind projects, with a lease from Bureau of Ocean Energy Management (BOEM), operational after January 2015, that demonstrate delivery of electricity into New York. Proposers must also (1) include commitments to negotiate project labor agreements, labor peace agreements, and prevailing wages; (2) submit environmental and fisheries mitigation plans minimizing impacts to fisheries and the environment; (3) participate in New York states offshore wind environmental, commercial fishing, jobs and supply chain, and maritime technical working groups; (4) consult with relevant state agencies around fishing, wildlife, and the environment; (5) make environmental data collected during site assessment publicly available; (6) implement lighting controls to minimize nighttime visibility; and (7) otherwise minimize visual impacts.

NYSERDA will use a scoring system to award contracts based on three components, including (1) project viability (10 points)a non-price evaluation; (2) New York economic benefits (20 points)a non-price evaluation; and (3) offer prices (70 points)a price evaluation. The project viability component assesses whether the proposed project is ready to deploy, technically and logistically feasible, sensitive to the needs of ocean users, and the goals of the CLCPA have been considered. Under the second component, New York economic benefits, proposals will be scored based on their investments into New Yorks economy. Under the third and highest value scored component, proposals will be scored based on their offer pricing structure and price evaluation. As part of the submission, developers must submit (1) a base proposal (which must use either the index OREC or fixed OREC pricing structure) and (2) a stand-alone proposal (which must request no New York state funding and cannot include a SCIP). Stand-alone proposals will be considered after NYSERDA completes the selection of proposals that include SCIPs. Proposers can submit an uncapped number of alternate proposals.

As the NYSERDA solicitation is moving quickly, developers need to be actively engaging with various stakeholders, including underserved communities, fisheries, and environmental groups, and demonstrating this engagement in their proposals. Developers recently awarded leases in the New York Bight also need to pay attention to the intersection between these stakeholder engagement requirements and BOEMs similar lease stipulations requiring engagement with fisheries, coastal communities, environmental and nonprofit groups, and underserved communities, among others, with an initial progress report detailing these efforts due on November 1. For example, BOEMs draft Fisheries Mitigation Guidance will factor in as companies develop their plan for NYSERDAs requirements under Appendix D of the solicitation. Developers must set forth their plans to communicate with commercial and recreational fishermen, a similar requirement to the fisheries communication plan required by BOEM in its lease stipulation and due in advance of the NYSERDA bid deadline. As BOEM moves forward on its Programmatic Environmental Impact Statement for offshore wind energy development in the New York Bight, BOEM should also be considering the impact of the NYSERDA bid within its analysis and the programmatic mitigation measures considered.

Moreover, developers must take note of BOEMs statement that it may condition approval of a construction and operations plan on the incorporation of cable corridors, regional transmission systems, meshed systems, and other mechanisms into the plan. Proposers therefore should consider whether incorporating HDVC technology and a meshed ready grid, as required for the OREC solicitation, will also help them achieve BOEMs ultimate approval of their project.

NYSERDA will host a conference via webinar on August 23, 2022, to address key elements from the request for proposal (RFP) and to provide further information to potential proposers. Proposers can submit written questions through September 16, 2022, and NYSERDA will respond to them in October. Proposers must provide notice of their intent to propose by December 1, 2022, and must register for the NYSERDA Portal by December 15, 2022. Proposals are due December 22, 2022, and NYSERDA expects to award and execute contracts in the first and second quarter of 2023, respectively.

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New York Announces Third Solicitation for at Least 2,000 MW of Offshore Wind - JD Supra