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Opponents appear on the verge of losing their fight to block the project

A top Japanese financial institution is betting on American wind power in a big way.

I. Big (Wind) in Japan

Mitsubishi UFJ Financial Group, Inc.'s (TYO:8306) Bank of Tokyo has offered up $2B USD in funding to the ambitious effort to build America's first offshore wind farm.  The commitment by the Bank of Tokyo to act as the Coordinating Lead Arranger (primary lender) removes the final hurdle from the Cape Wind project, according to its developers.

Located 5 miles offshore in the Nantucket Sound, and surrounded on three sides by three of the region's largest resort areas -- Cape Cod, Nantucket, and Martha's Vineyard, the project looks to have 130 turbines generating a peak capacity of 468 megawatts of power.  Spinning at a lazy 8 miles per hour, the turbines will tower 258 feet above the waters of the bay.

Cape Wind project
The project is located in Nantucket Sound. [Image Source: YouTube]

Like the now-defunct effort to build a 4 gigawatt wind farm -- the nation's largest -- in the panhandle region of Texas, the East Coast project was founded by a fossil fuel man who fell in love with the wind.

Energy Management Inc. founder Jim Gordon dreamed up the Cape Wind installation.  A highly successful and well-heeled natural gas developer, Mr. Gordon took careful note of the fact that the Sound featured some of the strongest winds of any coastal region in the U.S.  These northeastern gales made the project seem like a layup.

II. Cape Wind Supporters Rally for Over a Decade

But in the decade that passed after the project's conception Mr. Gordon was confronted by a baffling brand of Massachusetts "liberalism".  Former Massachusetts governor Mitt Romney along with his state regulators and county officials in Barnstable County subjected Cape Wind to an arduous set of reviews and public hearings.

In a state home to one of the nation's largest "environmentalist" movements, the issue deeply divided residents.  

Some supporters -- particularly laborers who eagerly awaited the high paying installation jobs the project would provide -- fought for the project, sporting "YES" signs at local rallies.  They were backed by some big national environmental organizations -- the Sierra Club and Greenpeace.

Cape Wind
Cape Wind supporters show off "YES" signs. [Image Source: Cape Code Today]

Kert Davies, Research Director at Greenpeace and a longtime activist on the Cape Wind project proclaimed in 2010, "There could be no clearer direction for America's energy future and global warming leadership, and Greenpeace is calling upon President Obama to think twice about his recently announced plans to open the door to more risky offshore drilling and to prioritize renewable energy projects like Cape Wind instead."

Former Massachusetts Sen. John Kerry (D), today the U.S. Secretary of State, also supported Cape Wind.

III. Opponents Get a Boost From Oil Billionaire "Willy" Koch

But other local landowners and "environmentalists" threw their weight behind the Alliance to Protect Nantucket Sound, sporting the catch phrase "SOS" (Save Our Sound).

They made their thoughts clear -- they demanded alternative energy.  But they wanted it in someone else's backyard.  

Wind protesters
Protesters wave signs in opposition to the Cape Wind project. [Image Source: YouTube]

They referred to the proposed installation as "visual pollution", despite the fact that the wind farm would be barely visible miles offshore.  Local environmentalists opposing the project found strange bedfellows.  By 2006 alone, the Alliance to Protect Nantucket Sound had received $1.5M USD from oil and coal scion William Koch, founder of Koch Industries.  Mr. Koch's tax forms indicated he personally paid Alliance CEO Audra Parker's nearly $150K USD salary.

The opponents' quest to derail the local wind project received a boost from local indigenous peoples -- the Mashpee Wampanoag and Aquinnah tribes ardently opposed the project, because they argued their ancestors left artifacts in the bay and hence building in it would be an act of desecration.  They were successfully able to get the shore classified in the National Register of Historic Places.

Governor Romney public opposed the project, alluding that he might use his power to veto any approvals.  He insisted that the market tampering was necessary to "protect" residents.

Tensions ran high on both sides, transforming what could have been a year-or-so regulatory process into a circus show running for over a decade.  That conflict was summed up in the award-winning documentary Cape Spin:


Similar fights were occurring elsewhere across the country.  After years of lobbying for alternative energy, environmentalists turned to fighting the projects they begged for, and local politicians were more than happy to help.  Such a marriage of protests and bureaucratic red tape led to regulators to refuse to connect what would have been the nation's largest interior wind farm to the grid.  Oil mogul T. Boone Pickens -- after pledging billions was left to throw up his hands as he watched it die.

IV. The Verge of Victory: State Approval

But it now appears that the lingering opposition to the project is blowing away.

One of Mr. Gordon's most effective tools has been a series of computer renderings he sponsored which showed residents in digital renderings just how hard it would be to even see the turbines from the shore or from boats in shallow waters.

Cape Wind
A rendered view of Cape Wind [Image Source: EMI]

The project received federal approval from the U.S. Department of the Interior in 2011.  And last year, the state of Massachusetts gave its approval.  Those approvals have come at a high cost -- the project backers have spent nearly $65M USD in lobbying and 12 years.

In his State of the Union address [YouTube] this past February, President Obama called on the nation to back efforts like Cape Wind to "combat climate change", remarking, "[We must] speed the transition to more sustainable sources of energy."

Jim Gordon told The Huffington Post, "Most projects and most developers that would get involved in a process like that would probably throw their arms up and walk away.  And for some worthy projects, that would be a shame."

As one pro-turbine resident elated in the Cape Spin documentary, "Cape Wind will be built and I can't wait: build the god damn wind farm."

Under the contract approved by Massachusetts' state government last year, NSTAR Electric Comp. (NSARP) will buy electricity from the EMI installation for 15 years.

V. Opponent: "It's Going to End When ... We Just Beat Them to Death."

Currently China has 3 offshore wind farms.  The world's remaining 22 wind farms are all located in Europe, providing 3,600 megawatts of power from 1,600 offshore turbines.  Most of those installations are in the coastal waters surrounding EU member state England.

China wind
A crane installs an offshore turbine in China. [Image Source: OffshoreWind.biz]

Now the U.S. may join that elite crowd.

But even with the state approval and financial backing, the project still faces a tough fight as it plans to break ground and begin construction later this year.  Opponents have vowed to kill the project with lawsuits.

Cape Wind protester
Protesters have promised murderous resistance to the project. [Image Source: YouTube]

As one opponent said of the project's supporters in Cape Spin, "It's never going to get built.  It's going to end when they either quit or we just beat them to death.  But this project's going down." 

Source: Cape Wind [press release]



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RE: Nimbys
By daboom06 on 4/16/2013 2:28:07 PM , Rating: 2
i was going to say that wind power will never work, but then i looked it up. the global change in wind speed if half of 2030's global energy comes from wind is less than 1%.

http://www.ceoe.udel.edu/cms/carcher/my_papers/Jac...


RE: Nimbys
By Solandri on 4/16/2013 7:34:11 PM , Rating: 3
After hydro (which is already cheaper than coal/nuclear), wind is the renewable which is closest to becoming cost-competitive. Its lifetime production cost per kWh is currently around 7-11 cents, vs 4-6 cents for coal and nuclear. So it's definitely a viable power source, or on the cusp of becoming one.

It's just that the places optimal for wind aren't that common. Most of the prime spots are already taken, so that 7-11 cents represents the best you're gonna get with current technology. If we vastly expanded it to sub-prime locations, production cost would be significantly higher per kWh.

I had thought the Cape Wind project was one of these prime areas. But this $2 billion investment has me re-thinking that. Offshore wind typically has a capacity factor of around 0.35 (vs about 0.20-0.25 on land). 468 MW * 0.35 = 163.8 MW average production throughout the year. At $2.6 billion (according to wiki, with the Japanese funding $2b of it), that's $16 per Watt of average production.

In contrast, an AP1000 nuclear reactor has a construction cost of about $2-$5 billion, with the most pessimistic estimates being about $10 billion. At 1000 MW with a 0.9 capacity factor, that's 900 MW average production, or a cost of $2.2-$5.5 per W, $11 in the most pessimistic case.

The only way I can see Cape Wind being practical is if the area they want to build in will yield capacity factors much higher than average. The best offshore farms win the world (off Scotland and in the North Sea) get capacity factors of 0.5-0.6. Even if Cape Wind is that good, it's still $9-$11 per Watt, making it about as economically viable as the worst case for a nuclear plant.


RE: Nimbys
By StevoLincolnite on 4/16/2013 8:29:14 PM , Rating: 2
What some people don't seem to understand though is, you can't just go all pure Nuclear or all pure Wind or all pure Solar.

Solar only works half the time, Wind only works when there is... Wind.
Nuclear needs substantial amounts of water, so throwing a nuclear plant in the middle of a desert or anywhere where water is relatively scarce is a no no.

Geothermal can only be built in certain area's where the ground is hot near the surface.

The solution to all of this is simple. - Use them all, a mix of technology's will allow you to get the best energy production for any particular area and having a mix of power generation means if something like the wind isn't blowing, then you still have power.


RE: Nimbys
By Mint on 4/16/2013 11:33:26 PM , Rating: 2
That's just a platitude thrown around. Beyond a experimental purposes (we can't keep pushing down the cost floor of wind/solar without a minimum volume), a mix of sources is suboptimal.

The two best solutions for new baseload are nuclear and combined cycle gas turbine, with diurnal/seasonal fluctuations filled in with less efficient gas turbines (some CCGT, some OCGT).

If we go all nuclear, there is zero value for wind or solar alongside that. If some of it is natural gas, there is still very little value. There certainly is no economic value, as you're adding wind/solar cost while natural gas plants still have to be the same size and simply run at lower capacity factor (i.e. they only save fuel). Environmentally, there is also little value, even if you think CO2 reduction is worthwhile. Natural gas is already a much lower emitter than coal, and when it has to fill the wild fluctuations of wind/solar then it can't be as efficient. That means 1 kWh of wind/solar produces saves less than 1 kWh's worth of CO2 from CCGT.

Regarding water, it's a non-issue. Even in expensive areas, it's $50 per thousand cubic feet of treated water. A thermoelectric plant will evaporate 0.5 gallons of water per kWh, so that works out to $0.003/kWh. The real figure will be much less for untreated water. Interestingly, the water evaporated from the reservoir behind hydroelectric dams is over 10x greater per kWh. Source:
http://www.nrel.gov/docs/fy04osti/33905.pdf


RE: Nimbys
By StevoLincolnite on 4/17/2013 4:02:20 AM , Rating: 2
quote:
Regarding water, it's a non-issue. Even in expensive areas, it's $50 per thousand cubic feet of treated water. A thermoelectric plant will evaporate 0.5 gallons of water per kWh, so that works out to $0.003/kWh. The real figure will be much less for untreated water. Interestingly, the water evaporated from the reservoir behind hydroelectric dams is over 10x greater per kWh. Source: http://www.nrel.gov/docs/fy04osti/33905.pdf


You're only looking at it from an economical point of view, water can be a *very* big issue.
Seriously.

I live in the driest state on the driest inhabited continent in the world, we have had water restrictions on how we are allowed to water our gardens and lawns going on decades, because to put simply, the single river system in our state supplying millions of people simply can't handle it. - Adding Nuclear or Coal on top of that demand is impossible.
That's where other forms of power generation comes in like Solar, Wind, Dry Geothermal etc'.
And I would rather water my garden than having a Nuclear power plant. :)


RE: Nimbys
By Mint on 4/17/2013 7:23:54 AM , Rating: 2
Assuming you live in interior Australia, that's a very extreme example inapplicable to the US and probably 99% of the world's population.

Economic cost reflects supply. At a high enough cost, you can pipe water in from elsewhere, or even better, generate power near the sea (it doesn't have to be freshwater) and transmit it. You can also use cogeneration to desalinate water, so that's actually a net gain.

FYI, water gardening for a small lawn is estimated to use 35,000 gallons of water per year in California:
http://www.acwa.com/content/conservation/californi...
If that household's entire electricity usage was from nuclear or coal, it would only use 6,000 gallons per year. So for you to claim that shunning nuclear lets you water your lawn is disingenuous.


RE: Nimbys
By Paj on 4/17/2013 8:06:16 AM , Rating: 2
Seawater isnt ideal for cooling or heat transfer as it contains lots of impurities.

Most Australian cities have water restrictions, despite being on the coast, as freshwater supplies are low. The interior of Australia is very sparsely populated.

I imagine Texas, California, and other interior US states would have the same issues with obtaining freshwater. Sure, you could build pipelines or use desalination, but both options are very expensive.

I agree with the argument that having diversified energy sources is a good approach. It reduces reliance on any one source, and can reduce the need for extensive transmission networks if sited properly.


RE: Nimbys
By Mint on 4/17/2013 3:17:07 PM , Rating: 2
quote:
Seawater isnt ideal for cooling or heat transfer as it contains lots of impurities.
Take a look at the NREL link I posted. That's exactly what a lot of power generation uses. You can have closed-loop intermediaries with any purity of water you want, but it's very easy to use seawater as the final net heat recipient and for that to be where excess evaporation occurs.

Diversification with wind/solar doesn't reduce your reliance on natural gas at all. It increases it, because there is no other substitute to ramp up and down with it.


RE: Nimbys
By Paj on 4/18/2013 12:34:15 PM , Rating: 2
That report doesnt mention using seawater from what I can see, although it was interesting nonetheless.

I always thought using seawater was a bad move, as it leaves behind solid impurities once it evaporates which can cause blockages or corrode equipment.

Surely adding diversified energy sources reduces reliance on any one source - isnt that the whole point? If youre getting energy from solar, wind and gas as opposed to just gas, you'd need less of the primary supply.


RE: Nimbys
By Paj on 4/18/2013 12:39:55 PM , Rating: 2
Actually, it appears you can use seawater in the condenser, just not in the primary loop.

http://www.edfenergy.com/energyfuture/key-info/saf...

My comment was related to the primary loop where the water turns to steam and back again.


RE: Nimbys
By maugrimtr on 4/17/2013 8:43:55 AM , Rating: 2
quote:
Assuming you live in interior Australia, that's a very extreme example inapplicable to the US and probably 99% of the world's population.


Yes, only 1% of the population live in Australia, Africa, Asia and that other place with stretched water supplies and a propensity to suffer droughts. What's it called? North America?

That said, any method of generating energy should be appropriate. The article mentions UK but here's a snapshot of Ireland's situation:
http://en.wikipedia.org/wiki/Wind_power_in_the_Rep...

Ireland has a current installed capacity of 2000 megawatts and the industry is booming. The Irish are on track to start exporting wind energy to the UK in the next year or two. They'll still retain many older generators for obvious reasons - the wind isn't constant.

It's pretty shocking that the US is still stuck getting its first wind farm off the drawing board.


RE: Nimbys
By Mint on 4/17/2013 4:00:38 PM , Rating: 2
Sub-Saharan Africa gets 10x the rainfall of Australia and less total electricity consumption (only ~150 kWh/yr per capita). Its water problems are rooted in treatment/distribution, not natural availability. Sure, rainfall is minimal in the Sahara, but only a tiny percentage of Africans live there.

You aren't proving anything with that link. If Ireland wants to use all 2000 megawatts of wind, then they also need nearly 2000 megawatts of natural gas. That in turn means they could have survived with just the latter, and the former only saves fuel cost.

Maybe it makes sense for Ireland because natural gas is really expensive there. I know it works for New Zealand because they have fortuitous geography creating hydro storage to fill in the gaps as needed.

For the US, however, it doesn't make sense.


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