Deepwater Wind - Energy Highway

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! Executive Summary ! Enabled by the rapid evolution of the offshore wind industry in Northern Europe, offshore wind farms paired with transmission networks are today cost comparable with new fossil fuel plants in New York’s Zones K and J, when all important ratepayer benefits of these projects are considered. These “second generation” projects can now be built at a larger scale, can access stronger winds that are located in deeper waters far from shore, and can enable access to neighboring energy markets through the use of innovative multi-terminal HVDC submarine cable network designs. The most advanced – and ready for execution – utility-scale offshore wind and transmission project is the Deepwater Wind Energy Center (“DWEC”), an historic renewable energy project for New York. DWEC will be a 900 MW offshore wind energy plant located approximately 30 miles east of Montauk. The 2,900 GWh per year of clean, renewable energy from DWEC will be delivered into Zone K via a new regional HVDC submarine transmission system, the New England-Long Island Interconnector (“NELI”). NELI will, for the first time, connect Zone K with the SEMA zone of ISO-NE, providing increased system reliability and delivering considerable system benefits to the Long Island Power Authority (“LIPA”). Deepwater bid this combined DWEC and NELI Project in response to LIPA’s Generation and Transmission RFP for up to 2,500 MW issued on August 20, 2010. To Deepwater’s knowledge, the bid is still under consideration. DWEC is scheduled to deliver energy from the offshore wind plant beginning in 2017, and is therefore the nearest-term utility-scale offshore wind plant in the region. DWEC enjoys a considerable advantage in its permitting and siting. Over the last three years, a comprehensive ocean planning and baseline study process has been underway in this region led by the states of Rhode Island and Massachusetts. This work has made it possible for a utility-scale offshore wind farm and transmission network to achieve commercial operations in this ocean area within the next several years allowing this project to meet the near-term Zone K supply needs identified by LIPA. Moreover, Deepwater’s investments in characterizing the wind resource east of Montauk confirm that this site is among the most robust wind energy sites on the Atlantic coast. DWEC represents a near-term opportunity to extend New York’s electricity transmission infrastructure into nearby federal and state ocean waters and thereby significantly advance the goals established by the Governor for the Energy Highway: • Reduce constraints on the flow of electricity to, and within, the downstate area; and expand the diversity of power generation sources supplying downstate. By combining utility-scale offshore wind with new inter-regional transmission links Deepwater’s project will reduce congestion and lower average ! 1
! ! wholesale power costs in Zone K, and the projects will increase fuel diversity for downstate electricity supply mix. • Assure that long-term reliability of the electric system is maintained in the face of major system uncertainties. Deepwater’s project will increase system reliability by providing a new source of locational capacity downstate and by introducing greater long-term electric supply flexibility by creating a new transmission link to a sector of the ISO-NE grid to which New York is not currently connected. • Encourage development of utility-scale renewable generation resources throughout the State. Offshore wind is the only utility-scale and commercially mature renewable resource located in downstate New York and is the most scalable with thousands of megawatts of potential existing within a relative close proximity to the state’s shores. • Increase efficiency of power generation, particularly in densely populated urban areas. Offshore wind has the ability to deliver zero-emission power directly into the Zone K load pocket. This power results in significant emissions reductions but without the environmental justice challenges faced by conventional power plants. Additionally, the high capacity and peak coincidence factors of offshore wind will result in large price suppression benefits to Zone J and K ratepayers that far exceed those created by combined cycle gas-fired plants. Further expansions of New York’s Energy Highway into federal waters are also possible, serving downstate markets from other large wind farms that could later be interconnected by new offshore networks to both PJM East in central New Jersey and Zone J in New York City. While the offshore wind potential in this area is substantial, projects here will require an additional two or more years to develop because this area has not undergone the same level of planning and baseline data collection as those areas east of Long Island. The Long Island-New York City Offshore Wind Collaborative, led by NYPA, has shown great leadership in identifying and initiating the federal leasing process for a robust wind energy site in this region. Additionally, Deepwater is developing a combined wind farm (Hudson Canyon Wind Farm) and transmission network (Submarine Regional Transmission Line – SMRT Line) for this area, located to the south of the NYPA-led Collaborative project area. Deepwater’s SMRT Line project could connect both the NYPA Site and the Hudson Canyon site to New York City and Long Island. Deepwater has secured interconnection queue positions for SMRT Line and has submitted an application to the NYISO’s CARIS process for the project. ! 2
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Page 6 and 7: ! ! A final longer-term phase of de
Page 8 and 9: ! ! The Board of Managers also incl
Page 10 and 11: ! II. ! Project Description The Dee
Page 12 and 13: ! ! additional power will be divert
Page 14 and 15: ! ! As estimated by the New York St
Page 16 and 17: ! Environmental Benefits ! Improved
Page 18 and 19: ! ! Sources of Financing The projec
Page 20 and 21: ! ! approved Private Aid to Navigat
Page 22 and 23: ! VI. Interconnection ! Deepwater h
Page 24 and 25: ! VII. Technical ! The Project’s
Page 26 and 27: ! VII. Construction & Design Projec
Page 28 and 29: ! ! VIII. Socio-economic Considerat
Page 30 and 31: ! IX. Project Status ! On March 31,
Page 32 and 33: ! XI. Other Considerations ! Future
Page 34: ! ! Interconnections In New York, S

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