Departing LIPA chief backs new offshore wind farm plan

When LIPA chief Kevin Law took the reins three years ago, he won kudos from local politicians and beach-side homeowners for scuttling an offshore wind farm as too costly for ratepayers, too controversial and too close to shore.

But as he prepares to leave the power authority this month, Law is the driving force behind another wind farm project that could be nearly five times larger, dotting the Atlantic with more than 230 turbines, running 442 feet tall and stretching from Queens to western Suffolk.

So why would LIPA forge ahead with a costly and unproven project that could raise rates, threaten prime fishing areas and stretch the technical capability of offshore wind technology?

"At the end of the day, I'd rather be building windmills in the ocean than oil wells, given the disaster in the Gulf," Law said.

Law, like his predecessor, Richard Kessel, points to public policy goals, the objectives of two governors - Gov. George Pataki wanted 25 percent of energy to come from renewable sources by 2013, while Gov. David A. Paterson has a goal of 30 percent by 2015 - and a desire to reduce global warming as the reasons to push ahead.

While the old $811 million proposal was to have 40 turbines about 3.5-5 miles off Jones Beach, the new plan would put the wind farm far enough off shore to make it only minutely visible from land, if at all. But there's a heavy price to pay for that 13-17 mile distance: The project could end up costing nearly $4 billion, according to experts.

"The cost issue is the singular challenge," said LIPA trustee Neal Lewis, an environmentalist who, as director of the Neighborhood Network, was the Jones Beach project's major proponent. Lewis, now executive director of the Sustainability Institute at Molloy College, believes the challenges can be overcome.

But wind farm development experts say sinking up to 234 turbines in 100-foot-plus water depths is an expensive challenge.

More expense means higher electric rates because power from the project could be twice as expensive as energy from traditional plants. The previous and much smaller 40-turbine project would have upped rates for average customers $2.50 a month, LIPA projected. Heavy users would have paid even more.

LIPA, Con Edison and the New York Power Authority will share the costs and the energy equally. In the first of the two-phase project, LIPA would get about 125 megawatts - enough to power about 75,000-100,000 homes on Long Island and the Rockaways. But even that number is optimistic because the systems only produce about a third to 40 percent of their stated production capacity because of fickle winds, according to experts.

But there are other challenges. The proposed site is surrounded by heavily trafficked shipping lanes, and sits in prime fishing grounds, which fishermen are preparing to defend by opposing the project. Its proximity to Kennedy Airport could mean the radar interference problem feared from the last project could be exacerbated.

Fiscal challenges seen

Economists who have studied the viability of wind farms say the parameters LIPA and its partners have set present significant challenges.

"If the lessons of Cape Wind are applicable, the project is ruinously expensive," said David Tuerck, director of the Beacon Hill Institute of Suffolk University in Boston, which conducted an exhaustive study of the Cape Cod project that took nine years for approval and still has not been built. It would be the country's first offshore wind farm.

Despite the obstacles, not the least of which is a LIPA board of trustees highly sensitive to rate increases, Law thinks LIPA should continue to examine the wind farm idea.

"The desire and commitment is to make this project a reality," he said. "But we still need a lot of information before we go forward. Like everything else, it's got to be a balancing act between our desire to reduce our reliance on fossil fuel and our customers' ability to pay."

LIPA may have no choice but to push ahead at some level, with backing, he added. "If Congress imposes more mandates on utilities to address climate change, I presume they'll provide the financial incentives to meet those mandates, which will make it more feasible."

Earlier this summer, Congress balked at climate change legislation that would have provided those incentives.

Kessel, who is now chief executive of the New York Power Authority, which will hold the lease on the project, said if multi-million-dollar studies come back showing the project isn't feasible, "We have to look at alternatives that could include the original project or alternatives in between." He was referring to the project he proposed off Jones Beach a half-decade ago.

"I'd love to see a wind project south of Long Island," he said. "But I think before we go forward on an RFP [request for proposals] we need to know what the cost of the actual project is, is it affordable to NYPA ratepayers, and is it physically possible in that depth of water."

Even ardent supporters of offshore wind energy say the difficult economics of this project will require creative thinking and a more favorable regulatory environment to make it feasible.

"You go into deeper water, the turbines are clearly going to cost more," said LIPA trustee Lewis. He said LIPA should have begun the serious studies of wind potential, impact on wildlife and feasibility when it first proposed the project more than a year ago to overcome regulatory hurdles and public criticism that could further delay it now.

It is not so much the distance from shore, Lewis said, but water depths that make it both costly and difficult, given that projects in Europe have only in the past few years sunk turbines to those depths.

James Manwell, director of the Renewable Energy Laboratory at the University of Massachusetts, said while there has been new work on projects as deep as the one proposed by LIPA, he doesn't recommend it.

Project off Scottish coast

A demonstration project called Beatrice off the coast of Scotland is in about 140 feet of water - its two turbines produce electricity at a rate per kilowatt of between $5,000 and $6,000, which includes construction and operating costs. Extrapolated to the 700 megawatts this wind farm could generate, that's a cost of around $3.8 billion. By comparison, the 350-megawatt Caithness power plant cost LIPA ratepayers $1.6 billion. Experts note, however, that lack of fuel costs, along with no-emission health benefits, are big pluses for wind power.

Given the depths and the distance from shore, LIPA and its partners would be wading into a project that would be state of the art, Manwell said, always a risky venture for a first-time project. He said he'd recommend starting smaller and closer to shore.

Lewis, however, maintains that economies of scale would make the new project economically feasible. His idea: Double the size of the project from 700 to 1,500 megawatts.

There are also large questions about the impact on shipping and fishing.

While coastal homeowners concerned about property values were the primary opponents of the Jones Beach project, the current one has already won a fleet of different opponents.

"We have no choice but to fight it," said Bonnie Brady, executive director of the Long Island Commercial Fishing Association.

"It is irresponsible for LIPA or any other utility to site an offshore windmill project anywhere without the full support and cooperation of all fishing sectors prior to siting," she said.

The proposed site encompasses "highly important" fishing grounds known to commercial and recreational boats as Cholera Banks. Whiting, squid, blue fish, ling, sea bass, fluke and flounder all are caught there.

Law expressed concern for fishing groups who worry the project will affect their livelihoods, and will entertain others who worry about the impact on bills. But he says the alternatives to wind energy aren't pretty.

But another person connected to the project has doubts it will ever get off the ground.

"I don't think any of the parties can afford it," he said. "The substation, the cable, the interconnection - that's over $1 billion before you get to one windmill."