Ocean Renewable

OREC Works With Others To Secure Funding for Ocean Energy

Back in late fall 2005 and February 2006, OREC was hard at work, supporting legislative proposals like this and this to secure funding for wave, tidal and current renewable technologies.  A few weeks ago, with the efforts of our allies in the ocean development community, we have moved closer to that goal, as described in our press release below:

(OREC - June 29, 2006) The U.S. House of Representatives voted 232-187  to approve H.R. 4761 the Deep Ocean Energy Resource (DOER) Act - an important piece of legislation that can help reduce U.S. reliance on foreign oil and provide clean energy alternatives to conventional power generating systems.  Moreover, on voice vote, the House approved the Inslee Amendment on a voice vote which increases from $6 million per year to $20 million per year the amount allocated for direct grants to ocean renewable projects. These grants require 50% matching funds from private investment; however, $20 million represents a minimum investment.

The DOER Act contains various features that will help foster ocean renewable development, including Section 10 (authorizing Secretary to pass rules that would allow use of decommissioned oil rigs for all purposes in Section 8(p) of the OCSLA, including offshore renewable testing and development); Section 14 (distributing funds to support environmental studies in connection with bio-fuels, wind...or other energy production (which would include ocean); Section 26 (as amended, providing a minimum of $20 million annually to fund a grant program for ocean renewable energy projects). In addition, the DOER Act contains provisions which will allow states a greater share of royalties from offshore energy development which will allow offshore renewable developers to gain state support for projects.

With your support of the DOER Act, the ocean energy industry can become competitive with other sources of conventional and renewable energy. We thank you all for contacting your Representatives and securing a "yes" vote on H.R. 4761.

On Tuesday, the Appropriations Subcommittee on Energy & Water approved $4 Million to fund Section 931 of the Energy Policy Act of 2005.

“Section 931 requires the DOE to “conduct a program of research, development, demonstration and commercial application for cost competitive technologies that enable the development of new and incremental hydropower capacity, adding diversity of the energy supply of the United States, including: (i) Fish-friendly large turbines.  (ii) Advanced technologies to enhance environmental performance and yield greater energy efficiencies. (…) The Secretary shall conduct research, development, demonstration, and commercial application programs for – (i) ocean energy, including wave energy (…) and (iv) kinetic hydro turbines.”

While we had requested $50 Million and received $4 Million, this represents a sea change in Congressional attitudes towards ocean renewable power. There is still much more to do to shepherd these congressional actions through to reality.

OREC Supports Existing Procedures for Cape Wind

The Senate has started its debate over legislation to give Governor Mitt Romney the power to veto the the proposed Cape Wind offshore wind project, which would be located in Nantucket Shoals off the coast of Massachusetts.  A Boston Globe story on the current status of the bill is available here.

OREC opposed the original version of the Young Amendment that prohibited construction of wind farms closer than 1.5 miles from shipping lanes.  As described here, that amendment would have precluded development of many viable offshore wind farms and also, could eventually have been expanded to bar wave and tidal projects as well.  The present Young/Stevens amendment is narrower, giving the Massachusetts governor the power to veto one project:  Cape Wind.

OREC opposes this "poison pill" legislation. The bill sets a dangerous precedent for Congress to kill any offshore wind, wave or tidal project that has invested millions of dollars in navigating the regulatory process and injects yet another level of uncertainty into our nation's fledgling offshore industry.  If offshore wind and wave are to succeed in the United States, our projects must "sink or swim" on the merits, not politics.

For additional information, read OREC CEO Carolyn Elefant's  Letter to the Editor on the Cape Wind Project.

OREC Hits the Hill for Appropriations for Ocean Energy

OREC hit Capitol Hill last month to lobby for a $60 million appropriation for ocean energy.  The request breaks down as follows:

*Basic and applied technology research:              $20 million [DOE]

*Test Facility & Ocean demonstration projects:     $30 million [DOE]

*Identify location and permit test facility:               $ 6 million [DOE]

*Resource mapping and assessment:                   $ 4 million [DOI]

Suport for the request is summarized in this attached OREC Information Packet (Word doc).
Sean O'Neill, President of OREC and Damian Kunko of SMI, walked the Hill, distributing these packets and meeting with key staffers who will help shepard OREC's request through the budget process.  We will keep you posted on the outcome.
   

OREC Opposes the Don Young Amendment

Yesterday, OREC sent out an action alert to our 500 person mailing list, asking for action to oppose an amendment by Congressman Don Young to the Coast Guard Reauthorization Act that would sink the Cape Wind  offshore wind project and set dangerous precedent for any other offshore renewable project proposed in the United States.

As our email explained, the Young Amendment would prevent construction of offshore wind farms located less than 1.5 miles from shipping lanes, impose additional standards of review by the Coast Guard on offshore wind facilities and preclude any offshore wind development until such standards are in place.  Young's letter in support of the amendment offers further detail, but as a thorough counter-letter by Cape Wind bears out, Young's position is full of inconsistencies.  For example, the 1.5 mile barrier is far more stringent than barriers imposed for oil and gas or for offshore renewables in the UK or other countries.  And the Coast Guard already has regulations in place for reviewing impacts of offshore renewables on shipping, so added standards are not necessary.  Essentially, as the Cape Wind letter points out, the Young Amendment is nothing more than an attempt to have Congress override the environmental review of the Cape Wind Projects undertaken by multiple agencies merely because a few well connected constituents oppose the Cape Wind Project.

The Young Amendment would set a dangerous precedent for several reasons.  First, destroying the first proposed offshore wind project in the United States will set the nascent offshore renewable industry back several years.  Second, the Young Amendment would lay the ground for Congress to disapprove future projects approved through a fair environmental review process anytime  a  single interest group opposes the project.   As a result, developers would be able to attract investment when permit decisions are subject to ad hoc reversal.  Finally, the Young Amendment could eventually be expanded in scope to apply not just to offshore wind but offshore wave as well.

We urge you to visit the Cape Wind site and follow the directions contained in the press release to register your opposition to the Young Amendment.

For Posterity

The testimony that OREC submitted to the House Ways and Means Committee this past summer on a production tax credit for ocean renewables has been saved for posterity here in the Energy Bill archives.

OREC Comments on The National Energy Supply Diversification and Disruption Prevention Act

Here's another reason to join OREC, if you haven't already.  Last week, OREC learned about this draft legislation, National Energy Supply Diversification and Disruption Prevention Act, sponsored by House Resource Committee Chairman Pombo.  At first blush, the bill didn't seem to be much more than another piece of Katrina-motivated, feel good policy.  But upon closer review, OREC realized that the bill contained several provisions that would help the ocean energy industry.  Specifically, the bill provides for expedited environmental review of renewable energy projects (by streamlining the existing NEPA process), helps fund environmental review of renewable projects (costs which the nascent ocean energy industry cannot bear) and authorizes use of decommissioned oil and gas platforms for offshore wind and wave energy demonstration and development. 

Once OREC realized the import of the bill, we sprang into action.  Within a few hours of learning about the proposal, we'd drafted a letter to the committee with comments and an expression of support.  Today, we've learned that the bill passed in committee.   We'll continue to track the legislation as it goes through the Senate process as well.  But that's the type of service that we provide for our industry.

OREC Summary of the Energy Bill

Here's the conference version of the Energy Bill (pdf) (in all its 1724 page glory!).  We weren't able to highlight the provisions relevant to ocean but we've summarized them here.  To navigate the bill, we recommend using Adobe's word search feature to locate certain passages of interest.

We're happy to report that this is the first piece of legislation in more than two decades that accords federal recognition to ocean renewable energy.  Thus, for the first time, all forms of ocean energy - wave, tidal, current and OTEC - qualify for a renewable energy production incentive (REPI) and are considered eligible renewables for purposes of the mandatory federal purchase requirement.   Even better, the Energy Bill contains various financial incentives that might benefit ocean, including funding programs for rural communities interested in renewables (including ocea), loan guarantees for new technologies and programs to study ocean energy potential on federal lands. 

But while OREC and ocean gained big in the portions of the energy bill, the production tax credit (PTC) for ocean, that was included in the Senate Version of the Energy Bill was dropped at the last hour.  Though ocean renewables would hardly had only a de mininimus impact on the budget, there was a  need to drop programs and ocean was left out.  In addition, because the PTC was extended only two years rather than the five that most renewable groups had hoped, it was believed that ocean would not be able to benefit from the PTC given its short duration.  OREC looks forward to renewing the battle for the PTC both during conference corrections and when the PTC comes up for renewal in two years.

Click on read more for our section by section analysis (prepared by Damian Kunko of SMI, Scott Lindsay and last section by Carolyn Elefant of OREC).

Senate Energy Bill Posted

It's been a busy month for the Ocean Renewable Energy Coalition so even though posted about the Senate Energy Bill here, we did not include a link to the Bill in its entirety.  For those interested, here is the version of the  Senate Enery Bill (pdf) that was passed at the end of June.  You'll notice that OREC was successful in ensuring that ocean energy qualifies for the renewable energy production incentive (REPI), the renewable energy inventory to be conducted by the Department of Energy and the mandatory federal purchase requirement.  Even better, for the first time ever, ocean energy qualified for production tax credits and was also included as an eligible renewable for purposes of the renewables portfolio standard (RPS) that's in the bill.

The House and Senate bill have since moved on to conference.  We understand that a vote on the Energy Bill is imminent and we will keep you posted on the results.

So-Called National Ocean Protection Act S.1224

With all of our attention and limited resources focused on the Senate Energy Bill, we almost overlooked Barbara Boxer's so-called National Ocean Protection Act (June 9, 2005).  At a time when ocean energy is just starting to make strides and gain recognition in legislation, the Boxer Bill would throw up more barriers.  Among other things, Sec. 151 of the Boxer Bill will require federal agencies with permitting authority over oceans to certify that their decisions comply with applicable law - and will give NOAA review authority over those agency determinations.  Another layer of bureaucracy - just what's needed in the ocean energy industry.  Even worse, Section 161 calls for NOAA, in coordination with EPA, Corps and DOI, to develop an offshore permitting program for actions in federal waters including development of renewable energy.

More Details on Ocean in the Senate Energy Bill

The recently passed Senate bill that we posted on here contains many benefits for the ocean energy industry.  While the Senate bill isn't yet available online, we've given a run down of some of the amendments it contains that will help stimulate the ocean energy industry in the United States and move us on a course towards commercialization.  Just click on "read more" to view.