NC has great potential for offshore wind development, experts say, and a gust of direct benefits could follow
North Carolina could be a major player in the offshore wind industry.
Studies, state officials, private businesses and environmental groups all agree that the industry has the potential to bring several gigawatts of renewable energy, billions of dollars and hundreds of jobs to the state.
But some environmentalists say North Carolina is not moving fast enough to reap these benefits.
"How do we make sure that we get this economic development? It is going to take a dedicated effort from the state," said Katharine Kollins, president of the Southeastern Wind Coalition, a nonprofit that advocates for renewable wind energy. "North Carolina is a little bit behind, but it's not too late to catch up."
State officials disagree, saying North Carolina is actually right on time.
"State officials are in ongoing conversations with offshore wind developers to bring jobs and economic development opportunities associated with offshore wind development... to North Carolina," said Jordan Monaghan, press secretary for Gov. Roy Cooper.
There’s at least two areas off the coast of North Carolina that could one day have an offshore wind farm: Kitty Hawk and Wilmington.
Preliminary plans for the Kitty Hawk project show most of the jobs, money and power going to Virginia. North Carolina is still expected to receive some gains.
The Wilmington project still has several more years of planning left, so it's unclear right now where any potential benefits would go, but North Carolina has a few advantages that could help the state bring home more of them.
Avangrid Renewables is developing the Kitty Hawk project and already owns and operates an onshore wind farm near Elizabeth City. Power from there is sold to Amazon.
Last year, Avangrid submitted its construction and operations plan (COP) to the U.S. Bureau of Ocean Energy Management (BOEM). The plan outlines huge financial benefits, but almost all of it is for Virginia.
According to the COP, power from the Kitty Hawk farm will come onshore in Virginia and integrate into PJM Interconnection’s energy grid.
PJM Interconnection is an electric power system that services several states, including Virginia and a small region of northeastern North Carolina.
Avangrid also plans to build its maintenance facilities in Virginia and use ports in the Lower Chesapeake Bay area during construction of the farm.
"The economic development benefits don't stop at the state line for Hampton Roads. It's very close to North Carolina," Kollins said. "A lot of folks live in North Carolina and work in Hampton Roads. Virginia is [not] the only state that would see the economic benefits, even if it is considered a Virginia project.”
Kollins also points out that it’s not official that Avangrid will sell the power to PJM.
"There is no contract yet. I think this is one of the biggest misconceptions. This is something that Avangrid has to balance very carefully," Kollins said. "They have to message 'Are we a Virginia project? Are we a North Carolina project? Are we both?'
"In the end, they need a buyer. The buyer is going to be... either the state of Virginia or the state of North Carolina. But there has not been any purchase of any of that electricity."
Essentially, there’s still a chance Avangrid could sell power to North Carolina. But if the current plans continue, some North Carolinians will still get this power - the residents who are serviced by PJM in the northeastern region of the state.
Kerri Allen, a coastal advocate with the North Carolina Coastal Federation, said that regardless of where the power goes, it’s the renewable energy part that really matters.
"While we don’t know where that energy will end up, the fact is that wherever it does, it will offset carbon emissions, which helps our coast," Allen said. "I think it's our responsibility as citizens and good neighbors to generate that energy and hopefully see it within our state, or at least our region.”
As of right now, Avangrid is only planning to develop 40% of the land for which it has the lease. The company is developing the area in stages.
There’s still the potential for North Carolina to receive more power and jobs when Avangrid starts developing the other 60% of its leased area.
Kollins said state officials need to start planning and investing even more if they want North Carolina to see these benefits. She said it’s going to take a coordinated approach from the General Assembly, state agencies, and the North Carolina Utilities Commission.
Harvey Seim, a marine sciences professor at UNC-Chapel Hill, said the state has not moved aggressively or quickly enough to offer incentives to offshore wind developers.
"There's other incentives in place for other renewables, like solar. But there has yet to be any specific incentive for wind. I'm confident that states to the north of us have taken those steps already," Seim said. "So that was likely a factor in why we weren't seeing development happen early off in North Carolina. Developers want to have that guarantee of a return that they have a market for what they're going to build."
Despite this, Jennifer Mundt with the state department of commerce says North Carolina is right on time.
“While it might on its face look like we're behind in terms of investments and attention to bringing offshore wind industry to North Carolina, I actually think we're exactly at the right time," Mundt said. "What we can do is look to what states to the north of us have done... and identify what those states have done in terms of best practices. We can learn from what they've done... and adopt them here in North Carolina without having to go through their growing pains. And we can do it much more efficiently and effectively.”
Last summer, Cooper signed Executive Order 218, which created a multi-agency group called the North Carolina Task Force on Offshore Wind Economic Resource Strategies (NC TOWERS).
"That task force just met for the first time in February," Mundt said. "We have separated the task force into four discreet subcommittees to really hone in and further study and develop solid tangible recommendations to bring to both the governor and to the General Assembly”.
Executive Order 218 also established offshore wind development goals of 2.8 gigawatts off the North Carolina coast by 2030 and eight gigawatts by 2040. Cooper’s order says achieving these goals could power around 2.3 million homes by 2040.
Mundt said that if some power is developed off North Carolina, but sent to Virginia, it would still count toward that goal.
"The executive order is written such that we meet the development of those of those offshore wind gigawatts by those dates," Mundt clarified. "It doesn't stipulate that those electrons come onshore in North Carolina. But don't get me wrong. We would... very much like to see all of those offshore wind electrons [come] onshore [in] North Carolina."
Last year, Cooper and the General Assembly passed House Bill 951. The historic, bipartisan legislation requires North Carolina to reduce its carbons emissions by 70 percent by 2030 and to be carbon neutral by 2050. Mundt said energy from offshore wind could help achieve this.
"As part of an all of the above diversified energy resource mix, offshore wind should be considered as part of that, especially with the capacity potential that it could bring," Mundt said. "I think we'll see offshore wind coming in into play in order to meet those goals.”
The lease area off Wilmington, called Wilmington East, still faces several more years of planning. In late March, BOEM announced its auction for this lease will be held May 11.
BOEM must award the lease to a company by July 1. A 10-year federal moratorium on awarding offshore wind leases goes into effect on July 1. Former President Donald Trump issued the moratorium in September 2020.
Seim helped write a federal study in 2009 that looked at the feasibility of offshore wind energy in North Carolina. He still follows the subject. He said North Carolina could have an advantage in getting the power from Wilmington East brought here because of a nuclear power plant in Southport.
Seim explained that the power generated from an offshore wind farm must travel to land using really-high voltage lines. Once the power reaches land, it needs to tie into even more high-voltage lines to integrate into the power grid. The nuclear power plant in Southport already has those kinds of transmission lines in place. So developers could tap into that existing infrastructure, which makes it easier and cheaper for them. Once the power is on land, developers can sell it.
Duke Energy will likely be involved in this project., Seim said.
“For Wilmington East, as I understand it right now, Duke Energy surrounds the whole place," Seim said. "So Duke Energy is really the only utility in the landfall area who would have to agree to pick up the power."
BOEM said there are 16 eligible bidders for the lease to Wilmington East, including Avangrid and Duke Energy. In a statement, Duke Energy said they are evaluating all aspects of BOEM’s final sale notice.