- Oregon-based wind developer Progression Hawaii Offshore Wind has proposed a $1.6 billion, 400 MW offshore wind installation off the Oahu coast, following close behind a recently-proposed 408 MW wind project with a similar price tag by Denmark-based Alpha Wind Energy, the Pacific Business News reports.
- However, both projects lack a power purchase agreement with Hawaiian Electric Co. (HECO), Oahu's electricity provider and grid operator.
- Progression executives say they can deliver electricity at below $0.20 per kWh, which is slightly lower than Oahu's $0.263 per kWh average residential electricity price.
Oahu's offshore wind capabilities can be harnessed to deliver electricity at a slightly lower cost than the average electrical price, the wind project developers say.
The similarly-sized projects cannot be too big to integrate smoothly on Oahu’s grid, but must be sizable enough to maintain the economies of scale that help keep down costs. Progression executives say they can deliver the below $0.20 per kWh electricity.
Progression executives are confident that they can get the project off the ground, reporting more than 100 meetings with 50-plus stakeholders. The company executives also say they have equity backers, are financing development off the company balance sheet, and will submit a formal lease application for the site by the end of 2015 to the Department of Interior's Bureau of Ocean Energy Management. The construction deadline is set for the end of 2020, with the project set to come online within two years after completion.
Offshore wind production has become more attractive as a power resource with wind prices hitting record lows on par with natural gas prices. States like North Carolina, New Jersey and Rhode Island are eyeing large tracts of offshore sections to build wind farms. The Bureau of Ocean Energy Management estimated a 9,000 MW potential for wind development area off the Rhode Island and Massachusetts coasts.
A 30 MW, five turbine installation off the coast of Rhode Island’s Block Island being developed by Deepwater Wind will be the first operational U.S. offshore wind facility, and began construction this past summer. It's expected to be online by the end of 2016, with the power purchase agreement calling for all its output to go to National Grid, one of New England’s biggest electricity suppliers, at $0.244 per kWh.