How the process is expected to work as development of the energy source becomes more likely

Over the past few years, both the New Hampshire Legislature and executive branch have considered initiatives to advance offshore wind development. Their support for an offshore wind procurement process is not only critical to promote the development of a market for the energy generated, but it also signals that New Hampshire is interested in advancing the technology’s development.

In contrast to northern Europe, where national governments typically set procurement goals, state governments have led offshore procurement in the U.S.

States conduct procurement processes (and regulate transmission line siting in state waters and onshore) that allows developers to transmit energy from offshore projects in federal waters into a state’s energy grid in a manner determined by each state. This decentralized approach leads to different regulatory requirements and processes in each state.

For example, the Massachusetts Legislature adopted the Act to Promote Energy Diversity in 2016 and the Act to Advance Clean Energy in 2018 that together identified the amount of offshore capacity it would solicit and procure through a request for proposals. The legislation sought connection to 1,600 megawatts from offshore wind by 2027 and 3,200 megawatts by 2035, focused on projects that are currently being pursued in lease areas south of Martha’s Vineyard. By comparison, in New York the governor announced executive goals in 2017. In response, the Legislature there adopted the Climate Leadership and Community Protection Act that called for the solicitation of 9,000 megawatts by 2035.

Once a legislature enacts a procurement statute, solicitations may be conducted by electric distribution companies, the state energy agency or the public utility commission.

The state energy agency or PUC typically reviews project proposals and makes awards based on price and other requirements either prescribed by the Legislature or identified in the solicitation or RFP.

After a proposal is selected, the PUC and other agencies, including the consumer advocate, review awards or related contracts to ensure they comply with all state law requirements and do not result in an unjust impact on ratepayers.

New Hampshire took a step along this path when the Senate approved Senate 151 on a 23-1 vote. The legislation, similar to the Massachusetts approach, would have established a new state committee to solicit proposals from utilities to procure at least 600 megawatts of new offshore wind. Subsequently, the Senate Finance Committee retained the bill, which means that the proposal could reemerge in the 2022 session. This bipartisan effort indicates there is support for offshore wind development and procurement in the state.

During the same period, the Executive Council approved the use of $250,000 of American Rescue Plan funds to assess the impacts of potential offshore development in the Gulf of Maine, which is in its early stages. New Hampshire has also established several other commissions to evaluate the long-term prospects of wind development in the gulf. These groups will consider procurement, port facilities and related onshore infrastructure, effect on fisheries and wildlife, as well as job creation and economic growth.

The recent creation of the state Department of Energy also signals support for offshore wind. Conceptually, the agency will play the primary role in establishing procurement goals for the development of a future wind energy market. It is too early to tell whether it will fall to the PUC or the agency itself to evaluate any awards coming out of a procurement process. But the Commission to Study Offshore Wind, created in 2020 by House Bill 1245, falls under the new Energy Department, suggesting that offshore wind will most likely be an area largely handled by the newly created DOE and not the PUC.

House Bill 2, which created the Energy Department, also called for the creation of a study committee to evaluate the Site Evaluation Committee process.

Although the Legislature engaged in a process to revamp the SEC process in 2013, HB 2 made it clear that the Legislature still believes improvements can and should be made to the state’s energy project siting process. The role of the SEC in offshore wind development is primarily limited to the facilities for interconnection with the grid on shore. Pursuant to the Submerged Lands Act of 1953, coastal states have jurisdiction over a region extending 3 nautical miles seaward from the baseline, or shoreline — beyond this theoretical line is considered federal waters. Consequently, any aspect of offshore wind development occurring beyond this 3-nautical-mile limit is subject to federal, not state, jurisdiction. The potential revision of the SEC process could mean — and hopefully will mean — a more streamlined approach for companies seeking to bring OSW into the New England grid through New Hampshire.

Rebecca Walkley, an environmental and energy attorney at McLane Middleton, can be reached at 603-628-1250 or rebecca.walkley@mclane.com.

Several NH commissions plan to evaluate the longterm prospects of wind development in the gulf, including procurement, onshore infrastructure, effect on fisheries and wildlife, and more.