HomeMy WebLinkAbout06.20.11
CITY COUNCIL MEETING
CITY OF EVANSTON, ILLINOIS
LORRAINE H. MORTON CIVIC CENTER
2100 RIDGE AVENUE, EVANSTON 60201
COUNCIL CHAMBERS
Monday, June 20, 2011
7:00 p.m.
ORDER OF BUSINESS
(I) Roll Call – Begin with Alderman Fiske
(II) Mayor Proclamations and Public Announcements
(III) City Manager Presentations and Announcements
North Shore University Health System: Evanston Hospital Donations to
Evanston’s Police/Fire Foundation and Farmers’ Market
“File for Life” Program Announcement
Presentation of 2011 Top Corporate Citizen Award from North Shore United
Way
(IV) Citizen Comment
Members of the public are welcome to speak at City Council meetings. As part of the Council
agenda, a period for citizen comments shall be offered at the commencement of each regular
Council meeting. Those wishing to speak should sign their name, address and the agenda item
or topic to be addressed on a designated participation sheet. If there are five or fewer speakers,
fifteen minutes shall be provided for Citizen Comment. If there are more than five speakers, a
period of forty-five minutes shall be provided for all comment, and no individual shall speak longer
than three minutes. The Mayor will allocate time among the speakers to ensure that Citizen
Comment does not exceed forty-five minutes. The business of the City Council shall commence
forty-five minutes after the beginning of Citizen Comment. Aldermen do not respond during
Citizen Comment. Citizen comment is intended to foster dialogue in a respectful and civil manner.
Citizen comments are requested to be made with these guidelines in mind.
(V) Special Order of Business
(SP1) Climate Action Plan Update
(SP2) Wind Farm Committee Report
(SP3) 311: 1st Quarter Report
(SP4) Mass Notification: Public Information Option
(SP5) FY2012 City Council Goals Update
(VI) Adjournment
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City Council Agenda June 20, 2011 Page 2 of 2
6/17/2011 3:24 PM
SPECIAL ORDER OF BUSINESS
(SP1) Climate Action Plan Update
Staff recommends that City Council receive the Climate Action Plan update
which will be presented at the Council meeting.
For Discussion
(SP2) Wind Farm Committee Report
Staff recommends City Council consider the information provided by the Mayor’s
Wind Farm Committee, and that City Council provide direction regarding next
steps. Recommendations from the Mayor’s Wind Farm Committee for next steps
can be found on page 4 of Attachment 2.
For Action
(SP3) 311: 1st Quarter Report
Staff recommends that City Council review the 311: 1st Quarter Report which will
be presented at this Council meeting.
For Discussion
(SP4) Mass Notification: Public Information Option
Staff recommends City Council consideration of the Mass Notification: Public
Information Option which will be presented at this Council meeting. Staff
recommends that City Council provide direction to staff.
For Discussion
(SP5) FY2012 City Council Goals Update
Staff recommends City Council consideration and discussion of the FY2012 City
Council goals.
For Discussion
Information is available about Evanston City Council meetings at:
http://www.cityofevanston.org/government/agendas-minutes/agendas-minutes---city-council/index.php.
Questions can be directed to the City Manager’s Office at 847-866-2936. The city is committed to ensuring
accessibility for all citizens; If an accommodation is needed to participate in this meeting, please contact the City
Manager’s Office 48 hours in advance so that arrangements can be made for the accommodation if possible.
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For City Council meeting of June 20, 2011 Item SP2
Mayor’s Wind Farm Committee Report
For Discussion
To: Honorable Mayor and Members of the City Council
From: Catherine Hurley, Sustainable Programs Coordinator
Subject: Summary of Mayor’s Wind Farm Committee Review
Date: June 15, 2011
Recommended Action:
Staff recommends City Council consider the attached information from the Mayor’s
Wind Farm Committee. Recommendations from the Mayor’s Wind Farm Committee for
next steps can be found on page 4 of Attachment 2.
Summary:
The City of Evanston issued A Request for Information (RFI) with Respect to The
Development of Power from an Offshore Wind Energy Facility in Lake Michigan off the
Northern Shore of Evanston on May 1, 2010 and responses were received on June 30,
2010 from Mercury Wind Energy and Off Grid Technologies. On December 6, 2010, the
Evanston City Council voted to create a committee to review and evaluate the two
responses to the City’s Wind Farm RFI and to provide comments to the City Council
within 90 days.
On March 15, 2011 the Mayor appointed the Wind Farm Committee which is made up
of 21 individuals selected from the community including two co-chairs. The City’s
Sustainable Programs Coordinator staffed the committee. The Committee roster is
provided as Attachment 1 to this memo. The committee held four meetings (March 24,
April 27, May 19, and June 8, 2011) and held smaller discussions in four working
groups during the period of April and May, 2011.
The Mayor’s Wind Farm Committee has developed a summary report which includes
the work completed by the Committee to date. This document is provided as
Attachment 2.
Attachments:
Attachment 1 - Mayor’s Wind Farm Committee Roster
Attachment 2 - Summary of Mayor’s Wind Farm Committee Review
March 24th Meeting Minutes
http://www.cityofevanston.org/assets/MWFC%20Minutes%20032411.approved.pdf
Memorandum
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Page 2 of 2
April 27th Meeting minutes
http://www.cityofevanston.org/government/boards_committees/MWFC%20Minutes%20042711%20draft.pdf
May 19th Meeting Minutes
http://www.cityofevanston.org/government/boards_committees/MWFC%20Minutes%20051911%20final.pdf
June 8th Meeting Minutes
http://www.cityofevanston.org/government/boards_committees/MWFC%20Minutes%20060811.finalwAttach.pdf
4
Mayor's Wind Farm CommitteeFirst Name Last Name E-mail AddressAddressPhoneWorking GroupRachael Bisnettrbisnett@gmail.com828 Judson Avenue #7 843-822-3394Ownership of Facility and Operations & MaintenanceThomas CarryThomas.Carey@klgates.com1120 Lake Street312-807-4365Project Siting and Size of FacilityTom Cushingthomascushing@sbcglobal.net2305 Hartrey Avenue 312-213-7488Project Siting and Size of FacilityJack Darinjackdarin@sbcglobal.net525 Sherman847-651-0825 Role of the City of Evanston and PoliticsDeanna Dworakdeanna.dworak@gmail.com914A Crain St. Unit 1N 312-731-7030Technology and Equipment SourcingJoel Freemanjsf@grummanbutkus.com2151 Hartrey Avenue 847-869-0955Ownership of Facility and Operations & MaintenanceKevin Glynnkhglynn@gmail.com2119 Sherman224-436-1901 Technology and Equipment SourcingLibby Hilllibbyhill@comcast.net2715 Woodland Rd847-475-2096Victoria Hutchenvictoriahutchen@hotmail.com2316 Sherman Ave, Unit 1A 847-563-8282 Role of the City of Evanston and PoliticsJoe Jaskulskijjaskulski@ppg-global.com2308 Grant Street, Suite 300 847-323-0282 Role of the City of Evanston and PoliticsNathan Kipnisnkipnis@nkainc.com1642 Payne Street 847-864-9650 Project Siting and Size of FacilityDiego Klabjand-klabjan@northwestern.eduNorthwestern University, IEMS2145 Sheridan Road847-691-1148 Ownership of Facility and Operations & MaintenanceKristin Landryknl@u.northwestern.edu2420 Campus Drive832-276-1664 Technology and Equipment SourcingRichard Lanyondicklanyon@sbcglobal.net1019 Mulford Street847-864-2128 (h)312-307-8855 (c)Role of the City of Evanston and PoliticsTim Patton tsp2233@gmail.com2233 Lincolnwood Dr. 847-864-1006 Technology and Equipment SourcingNicolai Schousboenicolai.schousboe@comcast.net1139 Elmwood Ave.847-337-4792 Co-ChairTim Schwartztjschwartz7@gmail.com2925 Orington847-902-6863 Ownership of Facility and Operations & MaintenanceWilliam E. Siegfriedtsiegfriedt2@comcast.net2415 Colfax Street847-328-5975 Co-ChairJeff Smithjeffaction@jefflaw.com2724 Harrison847-332-1170 Role of the City of Evanston and PoliticsWilliam Wagnerwtwagner@comcast.net3307 Noyes Street224-522-3307 Project Siting and Size of FacilityFred Wittenbergenvimech@ameritech.net1726 South Blvd.847-869-9794 Ownership of Facility and Operations & Maintenance5
MAYOR’S WIND FARM COMMITTEE
Page 1 of 5
Final Report to City Council by Mayor’s Wind Farm Committee June 8, 2011
SUMMARY OF WIND COMMITTEE REVIEW
Table of Contents
• Committee Summary (this document)
• Working Group Reports on:
o Siting and Size of Facility
o Technology and Equipment
o Public Affairs
o Ownership, Operations and Maintenance
• Meeting Minutes which public comments
Historical Background
A Request for Information (RFI) with Respect to The Development of Power From an Offshore
Wind Energy Facility in Lake Michigan Off The Northern Shore of Evanston was issued May 1,
2010 and responses were received on June 30, 2010 from Mercury Wind Energy and Off Grid
Technologies
On December 6, 2010, the City Council voted to create a committee to review and evaluate the
two responses to the City’s Wind Farm RFI and to provide comments to the City Council within
90 days. The committee had two co-chairs and was staffed by the City’s Sustainable Programs
Coordinator.
The members were appointed on March 15, 2011 and the committee met four times, March 24,
April 27, May 19, and June 8, 2011, plus multiple sessions by four working groups in April and
May, 2011.
Reminder of the Purpose of the RFI:
A Request for Information collects information, usually preliminary to (and less formal than) a
Request for Qualifications ("RFQ") or Request for Proposals ("RFP"). An RFI is typically used
(and was specifically suggested for Evanston) where a government expected to take leadership
on a project does not have enough information to promulgate an RFP and seeks to expand its
knowledge base. The City of Evanston RFI here stated, as its intent, "to identify potential
partners, determine the City’s role and establish a process for the development of a renewable
energy facility off Evanston’s Lake Michigan shore."
Both respondents provided a great deal of information at no charge and in a timely fashion and
the committee thanks both Mercury Wind Energy and Off Grid Technologies for their effort.
A summary of pertinent information from these responses, and key information the committee
recognized while analyzing the responses, is as follows:
General
The two responses varied in detail and content, but provided at least partial useful information on
most aspects of the offshore wind farm concept. In some instances, the committee working
groups disagreed with projections, assumptions, or assertions of one response, or both.
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MAYOR’S WIND FARM COMMITTEE
Page 2 of 5
Final Report to City Council by Mayor’s Wind Farm Committee June 8, 2011
Committee working groups also attempted to supplement areas where questions were answered
partially or not at all.1
Information Regarding Equipment and Sizing
1. Mercury Wind Energy (MWe) proposes a location seven to nine miles from shore, and
concludes that a minimum capacity of 100 MW is necessary to achieve economies of
scale and profitability.
2. Off Grid Technologies (OGT) proposes the use of vertical-axis magnetic-levitation
turbines with an initial capacity of 200 MW. The committee notes that the design appears
to be in only a developmental stage, and has not yet been tested at any commercial scale.
3. The committee believes that sizing would affect City role. Commercial economics
incentivize building as large a project as possible. Evanston currently does not have
sufficient demand to use the full power production capability of a 100MW-200MW wind
powered generating system.
4. The committee finds that for a project of this size, the likely location of the grid
interconnection will be at Church & Laramie in Skokie, and will involve both the City of
Evanston and the Village of Skokie when cable must be routed from the shoreline to that
point.
Information Regarding Overall Timeline
The committee believes that schedules relative to various environmental studies, interconnection
studies, permitting, development of contracts and financing, constructing the necessary factories
and infrastructure, and procuring and installing the required specialized equipment, will be
significantly longer than those expressed by the respondents. A commercial-scale project, if the
first in Lake Michigan, realistically would take at minimum four years, and probably
considerably longer.
Energy Pricing Implications
The questions "What will the wind farm's generated electricity cost?" and "Who will buy it?" are
key to commercial-scale project feasibility but were not explicitly asked in the RFI nor answered
in detail.
One necessity for a project of this scale is a power purchase agreement (PPA), a contract
between the power producer and the buyer(s) covering, e.g., quantity delivered and the wholesale
power price. MWe described many of the considerations applicable to a PPA and these represent
useful information, while OGT presented additional examples of provisions the PPA might
1 As is to be expected in Evanston, committee work revealed diversity of viewpoints as to some aspects of
a wind farm project. Not every participant may embrace every statement in this report or in the working
group reports. However, efforts were made to report strong majority sentiment if not consensus.
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MAYOR’S WIND FARM COMMITTEE
Page 3 of 5
Final Report to City Council by Mayor’s Wind Farm Committee June 8, 2011
contain. Respondents only briefly mentioned in passing potential PPA buyers for the wind farm's
electricity.
The committee finds that:
1. The retail price of energy for Evanston’s electric energy users currently is not determined
by any single power generating facility. Unless the community so chose, the wind farm
likely would not affect the price to Evanston customers, with the impact depending on the
differential at time of delivery between wind farm-produced power and other sourced
power, and upon how much of the wind farm was included in Evanston's power mix.
2. The price of electricity is in flux, with possible large impacts from domestic and
international political, economic, and natural occurrences, well beyond Evanston's
control. Likely and possible scenarios as to possible electricity price, including demand
for renewable energy credits, need more study.
3. Guaranteeing a specific price to Evanston residents is only possible if:
a. Evanston forms a municipal utility (which it has in the past seriously considered
but ultimately declined to do) or
b. Evanston sets itself up for municipal aggregation of residential and small
commercial electric accounts in the city. Note that under this model of City role,
customers also might have the ability to opt out.
Involvement of Government
The committee found that the lack of a state and local framework is a disincentive to developers
to prepare serious proposals. Governmental leadership is key to progress on offshore wind
generally.
1. Federal
a. It is important to recognize that current federal policy, including financial support,
strongly favors offshore wind development.
b. Federal regulatory approval for the first U.S. offshore wind project is now
complete.
c. National policy documents on the future of offshore wind power repeatedly speak
to the critical role of state and local leadership.
2. State of Illinois
a. The State has a renewable [energy] portfolio standard (RPS), which aids wind
power project development generally.
b. The State owns the lakebed and has started the legislative process to establish a
framework for leasing the lakebed and regulating offshore wind.
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MAYOR’S WIND FARM COMMITTEE
Page 4 of 5
Final Report to City Council by Mayor’s Wind Farm Committee June 8, 2011
3. City of Evanston
Evanston has multiple role opportunities:
a. Evanston has helped spur the State of Illinois to consider offshore wind
development.
b. Development of the Lake’s strong wind is likely. If the City doesn’t take an active
role, it loses its chance to influence any proposed project.
c. The City has limited inherent authority, such as permitting the landing point of the
cable from the wind farm.
d. The City can and should foster education and transparent discussion on the
subject, and assess public opinion.
These roles are consistent with the City’s Climate Change Action Plan accepted by the
City of Evanston in November 2008.
Recommendations to the City for Next Steps
Accelerate our leadership:
1. Encourage, facilitate and follow the State’s activities for leasing and regulation of
offshore wind. Specifically, the City should promptly request that an Evanston
representative be the "local government official" on the expected Lake Michigan
Offshore Wind Energy Advisory Council.
2. Act in harmony with residents. The City should redouble its efforts to promote awareness
and foster transparent discussions.
3. Encourage and facilitate establishment of a meteorological station for obtaining data on
which a developer can assess its potential energy production and revenue stream on
which to finance the installation and its long term operation. This step is essential for
project feasibility, now or in the future. Collaboration with other interested partners, such
as Northwestern, will minimize or eliminate direct expenses by the City.
4. Identify the benefits and negative effects of an offshore wind farm. These should include
environmental, social, and financial considerations that impact the City and its residents,
its commitment to the Climate Action Plan, the University and local business.
5. Encourage, facilitate and follow other key studies that can sufficiently address project
feasibility, including avian and other environmental concerns.
6. Identify grants, tax benefits, and other means to demonstrate to developers and lenders a
favorable environment.
7. Follow other initiatives that indicate potential models for sharing leasing revenue and the
ability to generate tax revenue. The current activities in Ohio may represent one of the
possibilities. The City will want to have a leasing agreement, fee or other contractual
mechanism for a developer to bring cables onshore and route through City rights-of-way.
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MAYOR’S WIND FARM COMMITTEE
Page 5 of 5
Final Report to City Council by Mayor’s Wind Farm Committee June 8, 2011
8. Actively explore and select the City’s role(s) in the project, including whether the City
can or should consider itself a potential direct buyer of a portion of the power produced.
The role(s) chosen will drive Evanston’s participation in an RFP. An RFP would be
necessary only if the City chooses its role as owner, producer or buyer of the electricity.
9. Identify master planning concepts and imminent projects that may interfere, limit or find
synergy with aspects of such a wind farm installation.
10. Promptly designate a committee, board, or commission to work on the above, especially
the critical aspect of role determination.
11. Explore and collaborate with potential partners in one or more of the above to minimize
or eliminate direct expenses by the City. Explore potential partnerships with local
governments, institutions, and other entities that may be interested in sharing costs and
aggregating roles.
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Mayor's Wind Farm Committee Draft for Final Comment
Ownership, Operations & Maintenance Working Group May 19, 2011
Page 1
MAYOR'S WIND FARM COMMITTEE
OWNERSHIP, OPERATIONS & MAINTENANCE WORKING GROUP
Members: Joel Freeman, Fred Wittenberg, Rachael Bisnett, Diego Klabjan
Summary
In reviewing the responses to City’s Request for Information (RFI) for an off-shore wind turbine concept,
the two responses provided partial information on the various aspects of ownership, operations and
maintenance. The working group shares another working group opinion that the RFI language might
have been clearer in order to elicit the desired information from the responses.
Ownership of the generating equipment was acknowledged in both responses: The developer in one,
Mercury Wind Energy, LLC (MWe) and the turbine manufacturer, Regenedyne, in the other.
Ownership of the various points on which new equipment will reside and the implications to the City
was not well acknowledged. However, where details were provided, some appeared contradictory.
The interconnection between the wind farm installation and the local electric transmission system did not
contain adequate assessment to match the power production with the potential points of receipt of that
power. This will impact the extent of the City’s involvement in routing cable from the shoreline to the
interconnection point.
Both respondents indicated subcontracting of operations and maintenance (O&M) services. However,
useful information regarding O&M was only provided by MWe. The staging facilities suggested by
MWe included locations at Winnetka’s utility dock, Wilmette Harbor and Evanston’s beachfront dock,
possibly tied to a new Evanston marina. Lakefront access will be needed for servicing by water and
helicopter access needed to address unscheduled maintenance when lake ice prevents boat access.
Ownership of the power needs further clarification. One of the prerequisites to developing and operating
a project of this scale involves a contractual agreement between the power producer and the buyer(s), the
power purchase agreement, or PPA. With the term of the PPA spanning decades, the PPA becomes a key
step. Most power production guarantees, limitations, obligations to perform, verification, remedies for
non-compliance, etc., become articulated in the terms and conditions of the PPA. And as such, they
become contractual issues between the buyer and seller. Speculation as to potential buyers in this
arrangement receives only brief passing, leaving a key player virtually unaccounted for. Because the PPA
will also include the price of this wholesale power, it was the opinion of this working group that the
likely impact on the retail electric energy costs for Evanston consumers appeared misleading,
highlighting the need for additional clarification on this topic.
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Draft for Final Comment Mayor's Wind Farm Committee
May 19, 2011 Ownership, Operations & Maintenance Working Group
Page 2
The topics reviewed by the working group each contain the following components:
Excerpts from the City’s RFI in which the topic is referenced, implied or appears related.
Excerpts from the Mercury Wind Energy (MWe) response which address the topic directly or
appear to be related.
Excerpts from the Off Grid Technologies (OGT) response which address the topic directly or
appear to be related.
Comments and observations by the working group which summarize the responses, offer
clarification to certain points of interest and pose questions that may be pertinent in future steps.
Each excerpt includes the page number(s) of the applicable document from which the excerpt was
obtained. Some excerpts are abbreviated while others are presented in their entirety. Related
illustrations and diagrams were not included.
This working group has made no recommendations to the City at this time. It is believed that
development of recommendations will follow final review of all working group reports as a collaborative
process between all members of the committee.
OWNERSHIP
For an offshore wind turbine installation ownership takes multiple forms. It includes the equipment built
in the lake and the lakebed itself, the power cables brought onto land and the land itself, the connections
to other existing equipment and the actual power produced. Ownership of each aspect will be implied, in
part, by the level of control exerted over each portion.
Excerpt from the City’s RFI
“Anticipated Roles of the Project Partner – It is anticipated that the developer(s) would assume all
responsibility for siting, permitting, constructing…the offshore wind energy facility…and would assume
all development…risks associated with the project.” (p. 2)
Response of Mercury Wind
“1.2.3 The City of Evanston’s Role
A. The role the city can play in the proposed offshore Evanston Wind Farm is aiding the preferred
developer in: obtaining land lease rights, obtaining permits from the FAA, obtaining governmental
permits, setting contract requirements, and aiding the developer in obtaining electrical interconnection
permits.
B. Specifying and outlining what the developer, the city, and the current electrical provider are
responsible for.
C. Helping with obtaining construction permits and right of way easements to bury electrical
interconnection cables under city streets as they are installed from the offshore wind farm to the
substation.” (p. 18)
“3.0 General Planning and Predevelopment Considerations
3.1 Regulatory Approval Process
Mercury Wind Energy believes that the most difficult aspect of constructing an offshore wind farm for th e
City of Evanston will be in obtaining the regulatory permits. These regulatory permits from local
government, state government, and the Federal government will be the most difficult aspect of the
project. As of this moment, no offshore wind farms have been constructed in the U.S. Therefore, there are
many uncertainties (sic) as to navigating the permit process. The first step is for the City of Evanston to
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Mayor's Wind Farm Committee Draft for Final Comment
Ownership, Operations & Maintenance Working Group May 19, 2011
Page 3
award a development contract to construct an offshore wind farm. The second step would be getting the
approval at the state level. The third and final step would be getting approval at the Federal level. The
city’s roll (sic) throughout this process is petitioning the State and Federal government to grant the
regulatory approval to the preferred developer. The key uncertainties that are not known at this time are:
A. Who grants approval at the local level?
B. Who grants approval at the State level?
C. Who grants approval at the Federal level?
D. Which entity receives the tax revenue from the wind farm?
E. Who grants the leasing rights and determines the length of the leasing rights in Lake Michigan?
F. What entity receives the annual leasing fees of Lake Michigan?” (p. 65)
Response of Off-Grid Technologies
“3. Capital Requirements, Financing & Indicative Pricing
The following projections were developed using the NREL modeling system…
Wind Farm - Project Data Summary based on model default values
Property Taxes $1,380,000
Land Lease $600,000...” (p.12)
“Tax Parameters
Local Property/Other Tax Rate (percent of taxable value) na
Assessed value (percent of construction cost) na
Taxable Value (percent of assessed value) na
Taxable Value na
Taxes per MW $6,900
Local Taxes $1,380,000 100%
Land Lease Parameters
Land Lease Cost (per turbine) $30,000
Land Lease (total cost) $600,000
Lease Payment recipient (F = farmer/household, O = Other) F 100%...” (p.15)
“…the cost efficiency of having the manufacturer as the developer…” (p.16)
“We look to establish a close relationship with the city of Evanston to insure proper permitting and agreements on
staging areas, land facilities and transmission lines during construction .” (p. 24)
Comments and Observations by Working Group
1. Ownership for the various locations of construction and equipment interfaces generally lacked
sufficient definition and detail.
2. MWe appears to assume that the City controls more than it does. There is acknowledgement that
construction permits and use of City rights-of-way are the City’s jurisdiction. However, the State
of Illinois owns the lakebed and would be responsible for its leasing arrangements. The City
owns the point of “landfall.” There’s an assumption that the City can affect the outcome of
processes by other State agencies, Federal agencies and electrical system operators. Neither FAA
permits nor interconnection permits would rely on City involvement.
3. OGT appeared to identify most key areas in which the City would have jurisdiction: staging
areas, land facilities and transmission lines. OGT used modeling software that estimated certain
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Draft for Final Comment Mayor's Wind Farm Committee
May 19, 2011 Ownership, Operations & Maintenance Working Group
Page 4
costs related to leasing and property taxes, implying an element of ownership by others, but does
not identify the entities with whom these financial arrangements would be made. Some of the
modeling parameters do not appear applicable to an offshore installation.
4. The State currently has no leasing protocol for an offshore wind turbine installation. Apparently,
existing lakebed structures, such as, intake cribs and marinas have different arrangements not
applicable to a wind turbine installation. Rep. Gabel’s bill currently awaits final approval in the
State legislature for a wind energy council to determine the State’s leasing arrangements.
5. Q: Does the City have a leasing agreement, fee or other contractual mechanism for a developer to
bring cables onshore and route through City rights-of-way?
INTERCONNECTION
The electrical interconnection represents the point where the power generated is delivered into the
transmission system “grid” at the compatible voltage and other electrical characteristics. This also
represents the point at which the wholesale buyer identified in the PPA receives the power purchased .
Excerpts from the City’s RFI
“Anticipated Roles of the Project Partner – It is anticipated that the developer(s) would assume all
responsibility for … the offshore wind energy facility, including the interconnection to an onshore
receiver station…” (p. 2)
“B. Technical and Infrastructure Considerations
1. Interconnection – Please provide information related to the design of the overall electrical
interconnection system. Address the need for one or more offshore substations, the preference for, and
viability and availability of, AC or HVDC cables for interconnection, location of converter stations
(HVDC option), lake floor, routing and landfall considerations, and strategies for interconnection
reliability, security, and energy deliverability. In what ways can the City facilitate the interconnection
component of the project?” (p. 4)
Response of Mercury Wind
“1.2.3 The City of Evanston’s Role
A. The role the city can play in the proposed offshore Evanston Wind Farm is aiding … the developer in
obtaining electrical interconnection permits….
C. Helping with obtaining construction permits and right of way easements to bury electrical
interconnection cables under city under city streets as they are installed from the offshore wind farm to
the substation.” (p. 18)
“...Interconnection Facilities also located at: __Emerson & Dewey_.....” (p. 29)
“(c) General Design and Construction of the Facility
…The Facility shall be:
(1) Capable of supplying Energy Output in compliance with the requirements of the Interconnection Facilities
Agreement;
(2) Capable of operating at power levels as specified in the Interconnection Facilities Agreement;
(3) Equipped with protective devices and generator control systems designed and operating in accordance with the
Interconnection Facilities Agreement and Good Utility Industry Practice(s).
5.2 Construction.
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Mayor's Wind Farm Committee Draft for Final Comment
Ownership, Operations & Maintenance Working Group May 19, 2011
Page 5
(a) Design, Development and Construction. Except as otherwise provided in an Interconnection Construction
Services Agreement, as between Buyer and Seller, Seller shall have sole responsibility for the design and
construction of the Project and the Project Meter and all related metering and submetering facilities, including the
obligation to perform all studies, including environmental studies, pay all fees, obtain all necessary Permits and
execute all necessary agreements with Exelon/PJM and Participating Transmission Owners for the Electrical
Interconnection Facilities necessary for the ownership, construction, operation and maintenance of the Project
and delivery of Seller’s Products in accordance with the terms hereof. All of such design, construction and
upgrades shall be consistent with all standards and provisions set forth by FERC, PJM or any other applicable
Governmental Authority and the interconnecting Participating Transmission Owner. All Electrical Interconnection
Facilities, including metering and submetering facilities must be of sufficient capacity to permit the Project to
operate at all times during each month at the Project Capacity. Metering and submetering facilities must meet
such additional specifications as set forth in Section 3.8.” (pp. 29-30)
“Regardless of whether Buyer is a Participating Transmission Owner, Seller shall be responsible for all of Seller’s
interconnection arrangements” (p. 32)
“(ii) Seller shall construct or cause to be constructed the Electrical Interconnection Facilities at no expense to Buyer
such that the Electrical Interconnection Facilities are capable of delivering the maximum quantities of Energy to
the Delivery Point as contemplated in this Agreement during each month (in addition to any other output of the
Project as the Electric Interconnection Facilities are required to transmit) and shall cause them to be placed into
service, in each case, in accordance with the requirements of the interconnecting transmission owner and/or
operator, and applicable rules, if any, of FERC, PJM, Exelon, the Commission and any other organization or
Governmental Authority charged with reliability responsibilities.
(iii) At Seller’s expense, Seller shall have obtained (and demonstrated possession of) all Permits required for the
lawful construction, operation and maintenance of the Project and the Units, inclusive of the Electrical
Interconnection Facilities, including all those related to environmental matters, as necessary to permit the Seller to
operate the Project at the Project Capacity and for Seller to perform its obligations under the Agreement.
(iv) Seller shall have executed all interconnection and transmission services agreements, including the
Interconnection Services Agreement and the Interconnection Construction Service Agreement, all agreements
necessary for its use and control of the Site for purposes of the construction, operation and maintenance of the
Project for a term at least equal to the Pre-Services Term Period (if a Pre-Services Term Period occurs) and the
Services Term, and all other agreements that are necessary for Seller to perform its obligations hereunder, in form
and substance reasonably satisfactory to both Buyer and Seller in the case of each interconnection and
transmission services agreement, and which agreements shall be in full force and effect as of the Initial Delivery
Date.” (p. 34)
“2.0 Technical and Infrastructure Considerations
2.1 Interconnection & Overall Offshore Electrical Interconnection System Design
All existing offshore wind farms without offshore substations are connected to shore at the voltage used
within the wind farm (generally 12 - 13.8 kV low voltage, oil and gas platforms also use 13.8kV). However,
based upon initial electrical analysis, Mercury Wind has concluded that the Evanston offshore wind farm
should have an offshore substation. This substation will take collector voltages of 12kV or 34.5kV and
increase them to 69kV or 138kV in the “homerun” cable to shore. In a separate conduit, an interface cable
will be installed to enable each turbine to be tripped off in the event of a ground fault on the turbine side
of each transformer. Finally, a third conduit will house the fiber optic lines for turbine communication.
Interconnection of the wind farm to ComEd’s electric grid will consist of an existing three-phase overhead
feeder line. The disconnection of wind farm or isolation to faulty equipment from the utility grid will be
controlled by switchgear. Underwater cable laying, internal cable layout in the offshore wind farm, cable
layout through the shoreline ground area; landfall and connection to the grid will be disclosed in the
Evanston RFP. The submarine cables will be buried 3-4 ft into the lake bottom and encased in concrete or
grouted into the lake bottom at the shoreline to avoid damage to the cable by the winter ice. This main
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“collector” submarine cable will be connected from turbine to turbine, at the offshore wind farm, until all
the turbines are connected electrically like a grid. There will be one “homerun” submarine cable from the
offshore wind farm substation to take the wind farm output power, to the onshore electrical substation
near the intersection of Dewey and Emerson streets.25 This onshore substation is located approximately
1.4 miles inland and is owned by ComEd/Exelon. Figures 2.1.1 and 2.1.2 illustrate the system design and
location of the proposed offshore Evanston wind farm….
Once the ‘homerun’ electrical cable has reached the shoreline, it must be buried underground for
approximately 1.4 miles until it reaches the substation. The underground interconnecting cable burial will
require the City of Evanston to allow road construction on Emerson Street for about 1-2 months.” (pp. 50-
52)
“E. A 1-4 month electrical interconnection feasibility study must be conducted to develope (sic) a safe reliable,
efficient, and cost effective offshore wind facility.” (p. 66)
Response of Off-Grid Technologies
“2. Business Structure
Phase One:
… to provide 200 Mega watts of electricity...
…on shore transmission lines must be analyzed for Kv (sic) carrying capacity data and receiver sub-station for
power line load capacity, Interconnection Agreements obtained and considered, Sub-station controls & operating
facility, maintaining data,...” (p. 11)
“Detailed Wind Farm Project Data Costs ILLINOIS
Construction Costs Cost Local Share
…
Development/Other Costs
HV Sub/Interconnection
Materials $4,683,523 90%
Labor $1,434,655 10%
Engineering $6,373,102 0%
Legal Services $3,473,341 100%
Land Easements $0 100%
Site Certificate $1,625,141 100%...” (pp. 13-14)
“B) Technical and Infrastructure Considerations
1. Interconnection
(VAWT OFF SHORE JV) will collaborate with Local and National utilities, Transmission providers, Cities, States, and
The United States Government, to determine optimal interconnection design of the first of its kind scalable
technology wind power plant system... The Interconnection Customer agrees to construct its facilities or systems in
accordance with applicable specifications that meet or exceed those provided by the National Electrical Safety
Code, the American National Standards Institute, IEEE, Underwriter's Laboratory, and Operating Requirements in
effect at the time of construction and other applicable national and state codes and standards. The
Interconnection Customer agrees to design, install, maintain, and operate its Small Generating Facility so as to
reasonably minimize the likelihood of a disturbance adversely affecting or impairing the system or equipment of
off shore project.” (p. 17)
“Consideration of Kv (sic) line capacity up to lake front substation inverter system to local utility or end use r.” (p.
20)
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Comments and Observations by Working Group
1. MWe has assumed that ComEd’s transmission substation, TSS47, near Emerson Street and
Dewey Avenue has adequate capacity to receive the full power generated by the wind turbine
installation. Previous conversations between the Evanston Utilities Commission and ComEd
indicated that this location may be inadequate for the wind turbine installation size outlined in
the response. An alternative interconnection location for this scale of wind farm capacity may be
at ComEd’s Skokie substation located on Church Street near Laramie Avenue, several miles
further inland.
2. OGT used modeling software that estimated certain costs related to the interconnection, but does
not identify the entities with whom these financial arrangements would be made. Potential
interconnection points were not indicated by OGT.
3. The developer owns the equipment up to the transmission interconnection point. ComEd owns
the transmission interconnection points under consideration for the proposed scale of
installation. Evanston currently does not have an end user large enough to use the full power
production capability of the generating systems presented. The RFI responses did not
satisfactorily address these considerations.
4. A developer must obtain two levels of PJM feasibility study that evaluate all aspects of
interconnection capacity, configuration, monitoring, required upgrades, etc. These details
primarily affect the developer. The City will be impacted from a scheduling standpoint as these
steps will take time to enter into the queue and to fully transact .
OPERATIONS AND MAINTENANCE (O&M)
O&M is required to perform preventive maintenance, regular servicing and repair or replace worn or
malfunctioning components. To keep the facility operational and productive, equipment operations and
servicing need management through the allocation sufficient staff, scheduling, supplies and spare parts
and budgeting. Special considerations may be needed for the necessary support facilities.
Excerpts from the City’s RFI
“2. Business Structure – Please describe your recommended business structure for the development and
operation of an offshore wind facility. Describe the City’s role, if any…” (p. 3)
“4. Operations and Performance – Please provide information related to the operations and
performance… maintenance plan, facilities, staffing, spare parts, and response time for unscheduled
maintenance, scheduled maintenance procedures and frequency (including periodic turbine overhauls or
major component replacement/repair), remote communications, control, monitoring and dispatch
systems, documented safety and emergency rescue plans and facilities, anticipation of construction
and/or operational curtailment due to bird migration, and any additional items to be considered …” (p. 3)
“3. Infrastructure for Construction and Maintenance – Please provide information related to the
infrastructure required to execute the construction and maintenance phases of the facility. Address
specialized equipment needs and availability, availability of skilled labor and trained crews, access of
appropriate port facilities, laying of cable interconnection, insurance matters, potential weather and other
seasonal impacts on… maintenance… and any other issues that should be considered.” (p. 4)
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Response of Mercury Wind
“..Mercury Wind selects only experienced contractors who plan connection to the grid and arrange for delivery of
the energy to customers. Lastly, Mercury Wind secures financing early on in the development process to see the
project through from concept to eventual decommissioning. (p. 5)
“6. Mercury Wind is hiring experienced contractors and sub-contractors that have completed onshore and
offshore wind farms. Table 0.0 list’s (sic) a few of the experienced offshore wind farm contractors Mercury Wind
will employ for the proposed Evanston offshore wind farm. Approx. 90% of the sub-contracting companies listed in
table 0.0 have installed and worked on one or more of the 28 offshore wind farms in the world. The rest of the
sub-contracting companies have experience with onshore wind farms or an extensive marine resume.” (p. 8)
From “Table 0.0.0 Partial List of MWe Sub-Contracting Companies”, for “Operations & Maintenance” includes
“Global Wind Alliance, Frontier Pro…et al….” (p.8)
“1.2 Business Structure
1.2.1 Development of proposed Evanston Offshore Wind Farm
Mercury Wind Energy recommends to the City of Evanston that a wind developer, namely itself;
construct, manage, develop, operate, maintain, and eventually decomission (sic) the proposed Offshore
Wind Farm for the City of Evanston…”
1.2.2 Operation and Maintenance of an Offshore Wind Facility
Mercury Wind Energy recommends to the City of Evanston that the operation of the proposed Offshore
Wind Farm be operated and maintained by a utility company, the developer, or by another privately held
experienced offshore operations and maintenance company for the following reasons;
A. The City of Evanston has limited expertise… Therefore, it is much less expensive for a larger
energy company, such as ComEd/Exelon, EnXco, PJM, or others to operate and maintain the
offshore wind farm.
B. Cost, financial risk, and environmental risk prevent the possibility of the City of Evanston
maintaining, building, or owning the wind farm.
C. Contracting out the operations and maintenance of the proposed offshore wind farm to an
experienced operations and maintenance company will allow the developer to utilize previous
knowledge, experience, and economies of scale.8 Mercury Wind has already developed a
relationship with 2 highly experienced O&M companies that are interested in operating and
maintaining an offshore wind farm for Evanston.” (pp. 17-18)
“1.5.5 Maintenance Plan/Facilities/Staffing
Figure 5.3 shows Mercury Wind has located 3 ideal port locations from which to perform any operating and
maintenance procedures on the Offshore Evanston Wind Farm. These 3 ideal port locations are; Winnetka
Electrical Utility dock,20 Wilmette harbour,21 or the Evanston dock area curently (sic) located near the Church street
beach.22
…As was stated earlier in this RFI, 2 people are needed to service every 10 – 20 turbines. The turbine controls
facility can be located anywhere in Evanston, but it would be best to locate the controls and monitoring facility as
close to the wind farm, and boat port as possible. This allows for a faster service and maintenance time from the
crews and for decreased issues with faulty or inaccurate communication.” (p. 44)
“1.5.6 Evanston Marina
Another O&M facility option is; construct a Marina in Evanston between the Davis/Church and Clark Street
beaches. A Marina could be built to include a fine restaurant right on the water, and located on the second floor
could be the controls and monitoring facility for the Wind farm. Mercury Wind is in talks now with a well known
construction company that just finished building, “The Grand Marlin”.23 The Grand Marlin is a high end Marina
built on the famous white sand beaches of Pensacola, Florida. Here is the URL link to the new Grand Marlin Marina
should you care to take a look; http://www.thegrandmarlin.com/
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“1.5.7 Spare Parts
When an offshore wind farm is out of commission, 83% of the time it is due to a lack of spare parts. It should be
obvious here that the wind farm developer and owner do not make money during a downtime. Therefore, it is in
the best interest of the wind farm owner to perform regularly scheduled maintenance and replace turbine parts
BEFORE needed. In addition, newer turbines are now made without gearbox’s (transmissions) to reduce
maintenance issues. These newer turbines without gearboxes are referred to as, “direct drive” turbines. Since
most of the problems and wear and tear was occurring in the gearbox the turbine engineers redesigned the
turbines to run without the gearbox. The gearbox is one of the items that Mercury Wind is eliminating in its
turbines to reduce maintenance items and turbine downtime.” (pp. 45)
Other O&M items described include:
“1.5.8 Response Time For Unscheduled Maintenance…” (p.45)
“1.5.9 Scheduled Maintenance Procedures And Frequency
(Including periodic turbine overhauls or major component replacement/repair)…” (p.46)
“1.5.10 Remote & Wireless Communications…
1.5.11 Controls…Communications medium…Voice communications…
1.5.12 Monitoring And Dispatch Systems…” (pp. 47-48)
1.5.13 Safety And Emergency Rescue Plans And Facilities…” (p. 48)
Response of Off-Grid Technologies
“The maintenance cost of 500 conventional wind turbines over 20 years is tremendous. For newer machines
annual maintenance is estimated at 1.5 - 2% of original cost. The annual operation and maintenance of 500 two
megawatt commercial wind turbines, using current industry standards is between $26 and $35 million. Over 20
years (which is the life expectancy of a current commercial wind turbine) that comes to $525 million in
maintenance costs alone. That is $25 million more than we estimate the cost of a new One Gigawatt Maglev Wind
Turbine will be. This brings the creation and maintenance of a like sized wind farm cost to $1.025 Billion versus the
Regenedyne cost of $800 Million. The reason the operation and maintenance of the Regenedyne wind turbines is
so low is the frictionless power and the lack of wear on the materials as a result of there being no friction.” (p. 10)
“2. Business Structure
Phase One:
…data and receiver sub-station for power line load capacity, Interconnection Agreements obtained and
considered, Sub-station controls & operating facility, maintaining data,… operational risk analysis,…safety
analysis,…will be completed to evaluate the potential to deliver power to the market.” (p. 11)
“Phase Three:
…Monitor system and service to ensure optimal efficiency...” (p.12)
“3. Capital Requirements, Financing & Indicative Pricing
The following projections were developed using the NREL modeling system…
Wind Farm - Project Data Summary based on model default values
Direct Operating and Maintenance Costs $2,038,000...” (p.12)
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“Wind Farm Annual Operating and Maintenance Costs Cost Local Share
Labor
Personnel
Field Salaries $735,091 100%
Administrative $117,615 100%
Management $196,024 100%
Labor/Personnel Subtotal $1,048,730
Materials and Services
Vehicles $28,261 100%
Site Maint/Misc. Services $11,022 80%
Fees, Permits, Licenses $5,511 100%
Utilities $22,043 100%
Insurance $211,956 0%
Fuel (motor vehicle gasoline) $11,022 100%
Consumables/Tools and Misc. Supplies $71,641 100%
Replacement Parts/Equipment/ Spare Parts Inventory $627,814 2%
Materials and Services Subtotal $989,270” (p. 14)
“System will be developed with appropriate maintenance, remote communications, and monitoring to ensure
optimal efficiency.” (p. 16)
“3. Infrastructure for Construction and Maintenance
RM (sic) Engineering is a world-class engineering and procurement organization. The engineering arm of J. Ray
McDermott, JRM Engineering is a leader in offshore fabrication and installation and offers customers a full range of
engineering, procurement, and support services.” (p. 19)
“We look to establish a close relationship with the city of Evanston to insure proper permitting and agreements on
staging areas, land facilities and transmission lines during construction .” (p. 24)
“…- Generates Electricity with fewer moving parts
-Major Components located at ground level…
-Minimal Maintenance” (p. 27)
“All key areas 24/7/365 video & SATCOM monitoring.” (p. 33)
“No oil, grease or petro-fuel required.” (p. 33)
Comments and Observations by Working Group
1. MWe and OGT both identified that their design technologies have less servicing and
maintenance and, therefore, lower O&M costs than other conventional wind turbine designs.
Based on the background experience and new technologies presented, an O&M history will
require assurance to the power purchaser.
2. MWe identified a significant list of O&M considerations. Among these consideration are
potential lake front staging areas: Evanston’s beachfront dock, Wilmette Harbor and Winnetka’s
utility dock.
3. MWe implies an intent to subcontract operations and maintenance of the installation in portions
of their response. MWe also lists suggestions for operating the proposed wind farm that do not
offer realistic options. Since electric power deregulation became effective in 1999, ComEd has
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operated only as an electrical distribution company, not as a generating company. PJM
Interconnection manages and coordinates the power generated to match the power use
requirements in ComEd’s territory. PJM operates the transmission system to schedule in power
from all generating facilities, but does not operate any of those generating facilities. Therefore,
neither ComEd nor PJM would likely have the role of operator for any proposed wind farm.
enXco, Inc. does provide a range of O&M services.
4. OGT used modeling software that estimated certain costs related to O&M. OGT implies that JRM
Engineering would be contracted to perform maintenance at the facility.
5. OGT’s response indicated no specific requirements for monitoring facilities, only that theirs
would be “appropriate.”
6. The developer takes on the responsibility and the ongoing costs for O&M in order to comply with
the production provisions of the PPA and sustain the revenue stream from the buyer. The O&M
costs presented comprise a portion of the estimated developer’s costs, but there are no costs
presented that place specific requirements on Evanston.
7. Q: Have any inquiries been made of the potential locations in Winnetka and Wilmette? Q: Is it
necessary to presume a helipad would be part of a monitoring facility location? Q: Is this realistic
for these sites? What would be likely alternatives?
8. Q: Would a marina offer a funding mechanism for the facility or would it just blur ownership?
9. Q: Doesn’t an Evanston marina involve similar jurisdictional requirements and aesthetic issues as
the wind farm itself? Wouldn’t the concept of a marina generate an undesirable debate that
distracts from the primary focus of this installation?
10. Q: Is a local monitoring facility really needed or can monitoring be done remotely?
11. For 40 turbines MWe implies a service staff of 3-4. Due to likely safety protocols with water
access and confined spaces, the Working Group initially speculated that this staff level may be
underestimated. Q: Does this staffing assume full time for 1 daytime shift, scheduled periodic
visits, or something else?
POWER PURCHASE AGREEMENT (PPA)
The PPA gives a detailed articulation of the terms and conditions that form a contractual agreement
between the seller of the power generated and the buyer of that power.
Excerpts from the City’s RFI regarding City’s role in the Project
“4. Power Purchase Agreement (PPA) – Please describe your interest in maintaining all or a portion of the
project output for sale and address the ideal length of a PPA, terms of service, ancillary services, pricing
structures, production and availability guarantees, outages, facility operating criteria, curtailment and
start-up and shut-down considerations, insurance and indemnification requirements, default provisions,
and any additional information or recommendations for PPA terms and conditions that should be
considered.” (p. 3)
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Response of Mercury Wind
“…to eliminate risk and establish a hedge against possible downward pressure on commodity prices, Mercury
Wind will sign a 20 year PPA.…The 20 year PPA is the best strategy to allow wind developers to reduce pricing
uncertainty...” (p.21)
“1.4.1 Interest
Mercury Wind is interested in selling all of the output of the offshore wind farm to the IPA or local utility provider.
Mercury Wind prefers to sign a 20 year PPA with the Illinois Power Authority, ComEd/Exelon, PJM, or another local
electricity provider....” (p.22)
“1.4.3 Terms of Service
…Mercury Wind would be responsible for delivering this power under the agreed upon contract terms of the
PPA...” (p.24)
MWe gives detailed language as an example of general terms and conditions of the agreement that
include pricing, definition of power delivery point, availability and performance guarantees, metering
requirements for power production measurement and verification, financial arrangements for excess
power, insurance and financial remedies for non-performance, etc. A turbine performance warranty was
noted and can potentially affect performance requirements of the PPA, although this is an equipment
performance issue between the producer and equipment supplier.
Response of Off-Grid Technologies
“Regenedyne turbines are self sufficient and grid ready, and the excess energy will be sold back to the
municipalities in which they operate.” (p. 11)
“Phase Two:
…Complete the negotiation & submission of Power Purchasing Agreement (PPA) to local utility or corporate end
user...” (p.12)
“4. Power Purchase Agreement (PPA)
It will be the desire of VAWT Off-Shore JV to maintain all or a portion of the power from the proposed project
output for sale. Ideally, the power output will be negotiated and sold to a regional utility power company. Basic
terms of an agreement will be for a period of 20 years at a price of 18-24 cents per kilowatt hour (kWh). The
pricing may remain flat, fixed or may escalate or deescalate over the life of the agreement. Production and
Availability Guarantees will be put in place to insure proper operation and maintenance, safe reliable operating
conditions in accordance with prudent operating practices. There will also be plans for inspection records available
for the buyer. Curtailment provisions will be implemented due to an occasional necessity to curtail the production
of wind energy. The request to curtail might come from the Purchaser, Transmission owner, or Transmission
Authority for various reasons. Therefore, curtailment calculations will be negotiated depending on the reason and
origin of the curtailment. The PPA will require that we, the seller maintain, at our expense, specific insurance
policies. In some cases, there will be an option to list the purchaser as an additional insured under the policy.
Policies typically required include: commercial general liability insurance; worker’s compensation insurance for
seller’s employees; automobile liability insurance; builder’s risk insurance; all-risk property insurance; and business
interruption and extra expense insurance. The business interruption and extra expense insurance covers lost
revenues or increased expenses needed to resume operations after a claim under the property insurance policy.
The PPA will include detailed sections related to ‘events of default.’ Events of default are situations where the
action or inaction of one of the party significantly jeopardizes the overall project…” (p. 15-16)
Comments and Observations by Working Group
1. Both respondents identified a 20-year agreement for the PPA.
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2. MWe described many of the considerations applicable to a PPA and these represent useful
information. Potential candidates identified for this agreement include the Illinois Power
Authority, ComEd/Exelon, PJM or other power provider. (PJM is not a power purchaser.)
3. OGT identifies an agreement with a “regional utility power company”, but indicates no potential
candidates for this arrangement. OGT gives some examples of provisions the PPA might contain,
such as pricing structure, production and availability guarantees, data access, curtailment
criteria, various insurance and events of default.
4. OGT also includes some ideas that initially appear unusual and can be construed as contradictory
to other information presented. Therefore, questions arise:
“…excess energy will be sold back to the municipalities in which they operate.” How does excess
energy get generated? How would it get sold to the municipality if a utility is the buyer? If the
turbines operate offshore, do they operate in any municipality?
“…the desire of VAWT Off-Shore JV to maintain all or a portion of the power from the proposed
project output for sale.” What would be the strategy for selling only a portion of the power
output?
5. The developer owns the power produced as the seller until it’s delivered to the interconnection
point where buyer takes possession, according to the PPA. The buyer usually purchases at a
wholesale price to resell into a retail market.
6. The terms and conditions of the PPA outlines buyer and seller contractual issues and, for most
arrangements, these will not affect the price of Evanston customers. Despite the wholesale price
agreement in the PPA, it should be noted that the price of electric energy for Evanston’s electric
energy users is not determined by any single power generating facility. Unless the City is the
buyer in the PPA, the price of power to most customers will continue to be determined by retail
supply contracts or by ComEd’s existing retail procurement auction.
7. Q: If Evanston were to prepare a municipal aggregation arrangement, could it be a potential
buyer?
8. Q: How would renewable energy certificates (RECs) become available for this installation?
9. Q: Can Evanston receive or have access to any of the production data? Could this be a condition
of the PPA?
DECOMMISSIONING THE INSTALLATION
When the power production enterprise can no longer be carried out, there need to be provisions for
disconnection and removal of equipment and the associated costs.
Excerpts from the City’s RFI
“3. Capital Requirements, Financing & Indicative Pricing – Please describe … provisions for
decommissioning and removal of turbines ...Describe the City’s rol e, if any.” (p. 3)
“…assurance of site decommissioning and restoration at end of useful life…. Describe the City’s role, if
any.” (pp. 4-5)
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Response of Mercury Wind
“…Mercury Wind… secures financing early on in the development process to see the project through from concept
to eventual decommissioning.” (p. 5)
“1.2 Business Structure
1.2.1 Development of proposed Evanston Offshore Wind Farm
Mercury Wind Energy recommends to the City of Evanston that a wind developer, namely itself;
construct, manage, develop, operate, maintain, and eventually decomission (sic) the proposed Offshore
Wind Farm for the City of Evanston…” (p. 17)
“1.3.5 Decommissioning & Turbine Removal
Mercury Wind accepts full responsibility for the decommissioning and turbine removal of the proposed Evanston
offshore wind farm, but asks that a 20 - 50 year offshore land lease be approved by the city of Evanston. The
longer the offshore land lease the lease rights, the easier it is for the developer to pay for the offshore wind farm.
Mercury Wind has investigated the decommissioning timeline for a wind farm. Estimated site decommissioning has
a timeline range from 6 months to 2 years.10 Based upon additional conservative estimates of tearing down a large
scale construction project, Mercury Wind estimates the decommissioning of an offshore wind farm will take
approximately 6 months. Site restoration will take anywhere from another 6 months to a year. Total time spent, 1 –
2 years. The faster a wind farm is decommissioned, the cheaper. However, Mercury Wind is committed to the
environment and will do nothing to harm the marine ecological structure within Lake Michigan. If the process to
decommission turbines and restore the lakebed floor takes longer than intial (sic) estimates, Mercury Wind has
budgeted for that.” (p. 22)
“10 Decommissioning is “estimated” because no companies have torn down an offshore wind farm yet. Every
estimate published to date is conjecture. Mercury Wind has spoken with professional contractors and conducted
market research on this topic, neither of which was easy because no one in the US has offshore wind energy
experience. Mercury Wind in partnership with a sub contractor has developed a proprietary method to
decommission an offshore wind farm, quickly and with little environmental effect. This will be discussed in greater
detail during the RFP stage.” (p. 22)
“1.4.3 Terms of Service
Mercury Wind is responsible for: delivering power, constructing, maintaining, operating,
and the eventual decommisioning (sic) of th e wind farm.” (p. 24)
“1.6 Timeline
The proposed offshore Evanston wind farm is expected to be in operation for at least 20~25 years and will consist
of; construction, installation, commissioning, operation, and decommission phases….” (p. 48)
“3.3.10 Site Decommissioning & Site Restoration
Mercury Wind has investigated the decommissioning timeline for a wind farm. So far, the timeline’s (sic) range
from 6 months to 2 years. Based upon conservative estimates of tearing down a large construction project,
Mercury Wind estimates that to decommission an offshore wind farm will take approximately 6 months. Site
restoration will take anywhere from another 6 months to a year. Total time spent, 1 – 2 years. Obviously, the
faster the wind farm is decommissioned, the cheaper. However, Mercury Wind is committed to the environment
and will do nothing to harm the marine ecological structure. So if the process to decommission ends up taking
longer, Mercury Wind has budgeted for that.” (pp. 69-70)
Response of Off-Grid Technologies
“We anticipate decommissioning after a minimum of 100 years and should have this revisited on a decade basis.”
(p. 24)
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“-No Decommissioning” (p. 27)
Comments and Observations by Working Group
1. MWe has accounted for the concept of decommissioning the installation in its budgeting and
environmental concerns, but states that the lack of case studies for this step currently makes the
process more speculative. MWe stated that elaboration on the process would be reserved for a
formal proposal.
2. OGT has almost dismissed any need for decommissioning the installation.
3. Q: Can it be assumed that the State will have decommissioning provisions and requirements in
its lease?
4. Q: Will the City have decommissioning provisions and requirements in its contractual
arrangements for land-based components?
5. Q: Will ComEd have decommissioning provisions and requirements for its interconnection
arrangements?
OTHER ITEMS NOTED
The following items were not mentioned in the RFI, nor were they mentioned in either of the developer
responses. However, the Working Group found them important when considering the quality of the
initial construction and the ongoing operations and maintenance.
Independent Third Party Oversight during construction - What provisions will be made to insure
best construction practices are followed? Will FERC require an oversight committee?
Performance Bond for Construction - Would the State or FERC require such a bond?
Independent Third Party Oversight of Operations and Maintenance - What provisions will be
made to insure best O&M practices continue?
Glossary
“PJM Interconnection is a regional transmission organization (RTO) that coordinates the movement of
wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New
Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of
Columbia.” It acts as a neutral, independent party, to operate a competitive wholesale electricity market
and manage the high-voltage electricity grid to ensure reliability.”
(Source: http://pjm.com/about-pjm/who-we-are.aspx )
The Federal Energy Regulatory Commission, or FERC , is an independent agency that regulates the
interstate transmission of electricity, natural gas, and oil. For electricity, FERC also:
Regulates the transmission and wholesale sales of electricity in interstate commerce; reviews
certain mergers and acquisitions and corporate transactions by electricity companies; reviews the
siting application for electric transmission projects under limited circumstances; licenses and
inspects private, municipal, and state hydroelectric projects; protects the reliability of the high
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voltage interstate transmission system through mandatory reliability standards; monitors and
investigates energy markets;
Enforces FERC regulatory requirements through imposition of civil penalties and other means;
oversees environmental matters related to natural gas and hydroelectricity projects and othe r
matters; and administers accounting and financial reporting regulations and conduct of regulated
companies.
Areas considered outside of FERC's responsibility include : Regulation of retail electricity and
natural gas sales to consumers; approval for the physical construction of electric generation
facilities; regulation of activities of the municipal power systems, federal power marketing
agencies like the Tennessee Valley Authority, and most rural electric cooperatives; regulation of
nuclear power plants by the Nuclear Regulatory Commission; tree trimmings near local
distribution power lines in residential neighborhoods; issuance of State Water Quality
Certificates; reliability problems related to failures of local distribution facilities; and t ree
trimmings near local distribution power lines in residential neighborhoods.
(Source: http://www.ferc.gov/about/ferc-does.asp )
The Illinois Power Agency (IPA) was established in 2007 “for the purposes of:
Developing and submitting annual electricity procurement plans to the Illinois Commerce
Commission that ensure adequate, reliable, affordable, efficient, and environmentally sustainable
electric service at the lowest total cost over time, taking into account any benefits of price stability
for Commonwealth Edison and the Ameren Illinois Utilities. The plans are to include electricity
generated from renewable as well as clean coal resources.
Conducting competitive procurement processes according to the procurement plans as approved
by the ICC.
Developing electric generation and co-generation facilities that use indigenous coal or renewable
resources, or both, financed with bonds issued by the Illinois Finance Authority.
Supply electricity from the Agency’s facilities at cost to municipal electric systems, governmental
aggregators, or rural electric cooperatives in Illinois.”
(Source: http://www2.illinois.gov/ipa/Pages/default.aspx)
N:\JSF\Energy and Fuels\Evanston Energy\Wind Farm Committee\Ownership and O&M Working Group Draft for final Comment.docx
26
MAYOR'S WIND FARM COMMITTEE
Public Affairs Working Group Analysis • May 19, 2011
Members: Jack Darin, Victoria Hutchen, Richard Lanyon,
Joe Jaskulski, Nicolai Schousboe, Jeff Smith (chair)
Summary: Both responses to the City of Evanston ("CoE") Request for Information ("RFI")1
issued a year ago provided considerable information but addressed some public affairs questions
incompletely. Federal regulatory process relating to Great Lakes offshore wind development,
though details are still in flux, is now fairly predictable, and, while time-consuming, should not
ultimately pose an obstacle; indeed, the federal government would be a critical project resource.
Current lack of a state regulatory framework, and City lack of site control, by contrast, are
barriers to moving forward and disincentive for serious project interest.
City role in public affairs would have more dimensions than the two developer responses
outlined and could be substantial. Evanston has multiple models of role to choose between
before propounding an RFP. Comprehensive stakeholder engagement will be necessary.
Analysis of the RFI responses and other available information indicates encouraging potential for
an Evanston offshore wind farm, but also identifies uncertainties and significant potential
challenges for the project. Governmental leadership, including federal financial support, is key to
progress on offshore wind generally, and for this project. By maintaining an active interest in the
project, participating in state and federal policymaking process, and more clearly defining the
City’s role in an offshore wind project, Evanston can position itself to be a major participant in
such a project when these obstacles have been overcome and uncertainties have been resolved.
Contents:
Summary ..........................................................................................................................1
Purpose of the RFI ............................................................................................................2
Scope of Public Affairs Working Group Report ................................................................2
A. Federal regulation.........................................................................................................3
B. State regulation.............................................................................................................4
C. State regulation: Public Interest Doctrine ......................................................................5
D. County and regional regulation.....................................................................................6
E. City of Evanston regulation and role .............................................................................6
(1) Business structure ..................................................................................................7
(2) Capital Requirements, Financing & Indicative Pricing ...........................................8
(3) Timeline ................................................................................................................9
(4) Interconnection ......................................................................................................10
(5) Regulatory Approval Process .................................................................................10
(6) Environmental Issues and Anticipated Studies .......................................................11
(7) Public Outreach and Stakeholder Engagement .......................................................11
(8) Economic Development Opportunities...................................................................12
(9) Developer Expectations of the City ........................................................................13
F. Stakeholders and Public Opinion...................................................................................13
1 City of Evanston, Request For Information (RFI) To Develop Power From An Offshore Wind Energy
Facility In Lake Michigan Off The Northern Shore Of Evanston (May 1, 2010).
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Purpose of the RFI. A Request for Information collects information, usually
preliminary to (and less formal than) a Request for Qualifications ("RFQ") or Request for
Proposals ("RFP").2 An RFI is typically used (and was specifically suggested for Evanston)
where a government expected to take leadership on a project does not have enough information
to promulgate an RFP and seeks to expand its knowledge base.3 The CoE RFI here stated, as its
intent, "to identify potential partners, determine the City’s role and establish a process for the
development of a renewable energy facility off Evanston’s Lake Michigan shore."
Scope of the Public Affairs Working Group report: The first Mayor's Wind Farm
Committee meeting on 3/24/11 generated comments and questions relating to permitting
(including schedule); the public trust doctrine; the City’s role and responsibility, including
options for City role; the political and regulatory processes necessary to implement a wind farm
project; resident reaction; and possible litigation. These concerns were assigned to this working
group, under "role of the City of Evanston, and politics." The working group tried not only to
analyze and list the RFI responses germane to those issues but to supplement those, for the
Committee's and the City's use, by identifying the gamut of regulatory, legal, and public opinion
issues4 related to the project. For ease of discussion the name "Public Affairs" is here used.
The working group identified two larger categories: first, the legal and regulatory
framework, which was subdivided into federal, state, county, and municipal jurisdiction; and
second, the political environment in which such a project would develop. This report addresses
primarily the governmental and legal aspects, with most attention to the City's role. For each
subtopic, the RFI is compared to the respondents' answers, followed by the group's comments.
With respect to the political environment, work was limited at this point to identifying
possible interests. Time and prematurity mitigated against identifying support or opposition at
this early phase.
2 Note that, typically, not responding to an RFI does not preclude a potential partner from later responding
to an RFQ/RFP. As examples, see, e.g., City of Chicago, Request For Information (RFI) for Chicago
O’Hare International Airport Transit System Expansion (December 31, 2007),
www.flychicago.com/PDF/DoingBusiness/Archive/ATS11-9-07.pdf; City of Chicago Department of
General Services, Request for Information: Chicago CivicNet (November 2000),
www.muniwireless.com/reports/docs/civicnetRFI.pdf.
3 Garrison, Preparation for Offshore Wind in Lake Michigan: Information Solicitation Options for
Michigan and Wisconsin (Great Lakes Commission, Aug. 2009),
http://www.glc.org/energy/wind/Information-Solicitation-Options-Offshore-Wind-Lake-
Michigan_FINAL.pdf.pdf at 3-5; Cizon, Kunke, et al., Constructing an Offshore Wind Farm in the Great
Lakes, www.isen.northwestern.edu/doc/pdf/WIND_ENERGY_FINAL%20Report.pdf ("ISEN")
(undated), at 8-9. The New York Power Authority issued an RFEI in 2009 to gather "information [to]
assist NYPA in determining the feasibility of taking the next step of preparing a wind power development
RFP … expected to result in high-quality proposals for the construction of wind generating projects."
Offshore Wind Energy Proposed for Great Lakes (April 27, 2009),
http://www.renewableenergyworld.com/rea/news/article/2009/04/offshore-wind-power-initiative-
proposed-for-great-lakes
4 The RFI itself could have been clearer and/or more comprehensive in some of its requests. The
following words and phrases do not appear in the RFI: law, legal, regulation, lawsuit, litigation, politics,
political, public opinion. The key aspect of regulatory framework is only briefly mentioned.
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A. Federal regulation.
Questions: The RFI only asked obliquely about the role of, and interaction with, federal
government. Section C(1) asked, "Please identify any issues of concern related to the process of
obtaining all anticipated permits and approvals for the development of the offshore wind facility.
What key uncertainties are known or anticipated in this process at the federal … level."
Mercury Wind: Mercury states that "the most difficult aspect of constructing [the wind
farm] will be in obtaining the regulatory permits, that the "third and final step [after local and
state permits] would be getting approval at the Federal level," and that a "key uncertaint[y] not
known at this time" is who grants approval at the federal level (emphasis supplied). Mercury lists
five federal agencies that have granted permits for other projects, states that permitting can take
as little as 6 weeks, and posits a 6-month timetable for federal permitting, concurrent with other
jurisdictions (pp. 49, 65, 66), to begin as soon as the decision is made to proceed with the
project, although also stating that "obtaining permits can take anywhere from 6 weeks to 6
years!" (p. 50)(exclamation point in original).
Off Grid: OGT identifies 13 federal agencies and correctly details some studies expected
to be salient in obtaining federal permits (pp. 11, 19-20). No timeline is set.
Comments: In Lake Michigan, the United States Army Corps of Engineers will likely
take the lead on federal permitting and any joint federal-state permitting process.5 The
Department of Energy in a very recent 2011 report lists statutes and agencies involved in
offshore wind.6 The DoE report draws on the 240-page 2010 NREL offshore wind report that
devotes an entire chapter to permitting7 and states that the U.S. "is still establishing the
regulatory pathways for offshore wind."8 That NREL report charted a timeline of approximately
18 months for all federal permitting.9 In April, 2011, the final permitting was issued for the Cape
Wind offshore wind project in the Atlantic Ocean off Massachusetts.
Federal permitting in the Great Lakes isn't new. The universe of actors is known.
5 U.S. Dept. of Energy, A National Offshore Wind Strategy: Creating an Offshore Wind Energy Industry
in the United States ["DoE Strategy 2011'], (Feb. 7, 2011),
www1.eere.energy.gov/windandhydro/pdfs/national_offshore_wind_strategy.pdf at 10-11; S. Metivier,
Off-Shore Wind Power Projects: U.S. Army Corps of Engineers Regulatory Program and Permitting
Process, http://wiki.glin.net/download/attachments/950462/Metivier.pdf?version=1 (June 2009); Great
Lakes Wind Collaborative, Offshore Wind Farm Regulation in the Great Lakes (Aug. 2008); Maj. Gen.
John Peabody, U.S. Army, letter to Great Lakes Wind Collaborative (Feb. 24, 2009),
http://wiki.glin.net/download/attachments/950462/Response+letter+from+Corp+-
+GL+offshore+wind.pdf?version=1; ISEN, n.3, at 14-16 (identifying 12 federal statutes and 10 federal
agencies likely involved in permitting).
6 DoE Strategy 2011, n.5, at 10-13. A modified version is attached as Attachment 1 to this report. See also
Great Lakes Wind Energy Center Feasibility Study,
http://development.cuyahogacounty.us/pdf_development/en-US/GLWECFeasibilityRpt.pdf (Apr. 2009)
("GLWEC Cleveland"), ch. 10, incl. Table 10-1.
7 Musial & Ram, Large-Scale Offshore Wind Power in the United States: Assessment Of Opportunities
and Barriers ["Musial/Ram 2010"](National Renewable Energy Laboratory, NREL/TP-500-40745, Sept.
2010) (240 pp.), http://www.nrel.gov/docs/fy10osti/40745.pdf. Excerpts attached as Appendix 1.
8 Musial/Ram 2010, n.7, at 133.
9 Musial/Ram 2010, n.7, at 153-55.
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Stakeholder opposition to permitting, or a federal lawsuit, are potential delay factors. The DoE
recognizes that "the long and uncertain permitting processes" are slowing offshore wind
deployment. However, multiple sources document federal intent to streamline permitting. That
process is underway, and the knowledge base is growing. It is important to recognize that
current federal policy strongly supports offshore wind development.10
B. State regulation.
Questions: The sole RFI question about state role occurs in the same §C(1) quoted above
with respect to the federal role.
Mercury Wind: Mercury, as noted, identifies permitting as "the most difficult aspect" of
the wind farm project. As with federal permits, Mercury identifies state permitting issues,
including who even grants state approval, as "key uncertainties not known [sic] at this time."
Mercury lists several state agencies as likely to be involved, and posits a 6-month timetable for
"provincial" permitting, concurrent with federal permitting (pp. 49, 65, 66), to begin as soon as
the decision is made to proceed with the project. Mercury also identifies the ownership and
duration of leasing rights as issues.
Mercury devotes some discussion to Illinois ports. Mercury also notes that production tax
credits are most effective in states that offer other support, but does not delve into Illinois's
support mechanisms or discuss the impact of the state renewable energy portfolio standards.
Off Grid: OGT identifies limited state agencies or issues (pp. 11, 19-20). No specific
timeline is identified. Off Grid offers little other discussion of state issues.
Comments: The RFI responses yield little information on state permitting, interaction
with the state, and agencies involved. That said, the various federal reports (see notes 5, 7, and
10, supra) speak to the need for the states to take leadership on offshore wind, and especially in
the Great Lakes, but Illinois has thus far failed to act. Although regulation sometimes can
develop ad hoc, driven by developer initiative, the lack of a framework here is a disincentive to
developers to spend time on serious proposals, given other (primarily economic) challenges.
Without a framework in place, any developer faces the prospect of having to win approval for
their particular project in both houses of the General Assembly, plus the Governor.
Assuming that Illinois eventually codifies a path for applications, likely the Department
of Natural Resources, Department of Commerce and Energy, Illinois Commerce Commission,
Illinois Power Agency, and Attorney General will have the most involvement in rulemaking and
in administration of that process.
Evanston’s interest in this project is driving the State of Illinois to consider all of the
issues raised by offshore wind development. Legislation is pending in the General Assembly to
establish an Offshore Wind Energy Council to assess the opportunities and barriers to offshore
wind in Illinois waters, and to recommend state policies and actions to develop the wind energy
resource. Because the State owns the lake bottom, it could assert control over the process,
10 DoE Strategy 2011, supra n.5; Musial/Ram 2010, supra n.7. See also Strengthening America’s Energy
Security with Offshore Wind (US DoE, Feb. 2011), www.nrel.gov/docs/fy11osti/49222.pdf; Lindenberg,
Smith, et al., 20% Wind Energy by 2030: Increasing Wind Energy’s Contribution to U.S. Electricity
Supply ["20% by 2030"](US DoE, July 2008), www.nrel.gov/docs/fy08osti/41869.pdf §§2.5, 5.7.
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including any revenues produced by offshore wind projects. Evanston has a key advantage in
having been first to propose such a facility. Sustaining that interest will be key if Evanston is to
retain the option of control and participation in an offshore wind farm as the State develops its
policies and approach to offshore wind energy development.
Meanwhile, the following Illinois statutes need study and impact a potential project:
Illinois electric power generation, transmission, sale, and taxation statutes:
• 220 ILCS 5: Public Utilities Act
• 20 ILCS 3855: Illinois Power Agency Act
• 65 ILCS 5 11-119.1-1 et seq.: Illinois Joint Municipal Electric Power Act
Lake Michigan regulation statutes:
• 5 ILCS §§ 605/0.01 to 605/02 (Submerged Lands Act of 1937)
• 20 ILCS §§ 801/5-5 to 801/5-10 (Office of Water Resources)
• 70 ILCS §§ 1815/2.5, 1820/2.14, 1821/2.14, 1835/2.14, 1845/2.14, 1850/2.14, 1855/2.14
(“navigable waters” "usable for water commerce” for port purposes)
• 70 ILCS § 1835/18 (permitting on obstruction of the navigable waters)
• 525 ILCS §§ 45/1 to 45/7 (Water Use Act of 1983)
• 615 ILCS §§ 5/4.9 to 5/30 (Rivers, Lakes, and Streams Act (esp. 5/7))
• 615 ILCS §§ 10/0.01 to 10/28 (Illinois Waterways Act)
• 615 ILCS §§ 20/1 TO 20/5 (Navigable Waterways Obstruction Act)
C. State Regulation: Public Interest Doctrine
Questions: The RFI did not specifically ask about the impact of the public interest
doctrine, but the topic arose at the first meeting of the Wind Farm Committee, and the Public
Affairs working group undertook some analysis.
Mercury Wind: Mercury, proactively, identifies the following "key uncertainties":
"E. Who grants the leasing rights and determines the length of the leasing rights in Lake
Michigan?
"F. What entity receives the annual leasing fees of Lake Michigan?" (p. 65)
Off Grid: OGT does not discuss the public trust doctrine.
Comments: Site control, the right to develop on a specific property, is key to any project.
Unlike a land-based wind farm which is usually on private property, the wind farm and the
transmission lines to shore, as well as, likely, a substation, necessarily are on lake bottom, which
under longstanding common law is held in trust for the public. The "public trust doctrine" forbids
alienation of that land to private actors for private purposes, and Illinois has been a particularly
strong defender of that doctrine.
As summarized by one commentator, "The signature American public trust doctrine case
is Illinois Central Railroad v. Illinois, an 1892 decision of the Supreme Court, in which Justice
Stephen Field authored a majority opinion for the Court that held that the state could not
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privatize most of the Chicago harbor without violating the public trust doctrine."11 The doctrine
retains vitality: on April 25, 2008, the trial court in Protect Our Parks, Inc. v. Latin School of
Chicago, No. 08–CH–14027 (Cir. Ct. Cook Co.) entered a temporary restraining order (TRO)
against construction of a semi-private soccer field on lakefront land, based in part on the public
trust doctrine.
As noted, strong public policy favors the development of renewable energy, including
offshore wind energy. The development of energy resources for the common good is often
considered a public purpose. A lease, limited in time, is not the same as a sale, especially where
there is little to no exclusion of the public as a result of the lease, and where no filling is to be
done in the lake. The transmission cables are likely to be buried, according to the two
developers. The impact on most lake uses from the offshore wind farm, at first glance, is far less
than for the primarily shoreline conveyances that have run afoul of the doctrine.
CoE involvement may, additionally, strengthen the case against a public trust doctrine
argument. Nevertheless, any RFP should require such analysis, because at minimum the issue
will require public discussion.
D. County and regional regulation
Questions: The RFI did not specifically ask about county or regional regulation or
permitting. Neither respondent specifically addressed the issue of county or regional regulation.
Mercury Wind: Mercury, proactively, identified "municipalities [other than Evanston]
with potential visible impact" as parties that might require approval (p. 65).
Off Grid: OGT does not discuss local governments other than Evanston. The visible
impact is stated to be less of an issue because of the lower profile of the OGT vertical turbines.
Comments: County and regional government are unlikely to be involved in permitting or
have much say in the project. If transmission lines or facilities use county or regional rights of
way or facilities, there could be involvement. The most likely involvement of other local
governments would be if they partner with Evanston in a power district, power purchase
agreement, or similar arrangement.
Asking developers to identify the involvement and impact of local governments other
than Evanston should be part of any RFP, and the City, if aware of any such parameters, should
proactively inquire about them.
E. City of Evanston regulation and role
Questions: The Public Affairs working group identified nine areas in the RFI requesting
information about City role: (1) business structure; (2) capital requirements, financing &
11 Blumm, The Public Trust Doctrine and Private Property: The Accommodation Principle, 27
PACE ENVTL. L. REV. 649, 660 (2010), http://digitalcommons.pace.edu/pelr/vol27/iss3/3. For a relatively
recent survey of case law and a partial list of Illinois decisions, see R.K. Craig, A Quick-And-Dirty Guide
To The Eastern Public Trust Doctrines: Basic Issues, Classifications Of States, And State Summaries
(August 2007), at 29 -31, http://works.bepress.com/robin_craig/1.
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indicative pricing; (3) timeline; (4) interconnection; (5) regulatory approval process;
(6) environmental issues and anticipated studies; (7) public outreach and stakeholder
engagement; (8) economic development opportunities; and (9) developer expectations of the city.
This analysis thus commanded most of the working group's attention. These sub-areas are
discussed below, in order.
(1) Business structure. The RFI asked developers to "describe the City’s role, if any"
in "your recommended business structure for the development and operation of an offshore wind
facility."
Mercury Wind: Some of Mercury's response suggests a limited role for the City in
business structure per se, recommending that Mercury "construct, manage, develop, operate,
maintain, and eventually decommission the proposed wind farm" and that Evanston would not be
involved in "maintaining, building, or owning the wind farm" (p. 18). Mercury expects that the
City would aid the preferred developer in obtaining land lease rights (p. 18). However, Mercury
also ties its discussion of a power purchase agreement to the City of Evanston, saying, "the
average price of electricity for Evanston residents can be held constant at 14¢ per kW/h or less
for the next 20 years" (p.23). This implies the City or an Evanston-specific entity as the PPA
customer or re-seller. Mercury's discussion of a PPA is lengthy and includes sample clauses.
Off Grid: No discussion under "business structure."
Comments: The RFI advised that the developer would be assuming all responsibility for
physical development of the wind farm. Only on closer reading does it appear that the RFI is
silent and thus open-ended, and inviting ideas, as to "business structure."
Note Evanston has nothing to ask for in an RFP, and bidders have nothing to bid on,
unless CoE is the power purchaser or aggregator12 or has effective control of the lake bottom.
The working group identified multiple models of municipal involvement in the business
of the project. In all except (A) the City could secure other partners:
A) City has no role in project business (developer gains site control directly from state,
finances project with no City involvement, and bypasses City to market the power)
B) Same as (A) but City leases or subleases lake floor access to developer
C) Same as (B) except City participates in a regional entity with one or more other
institutions and/or governmental units (similar to Cleveland)
D) City has stake in project (see §E(2), infra p.8) and shares in revenue by contract or fee
E) City has stake in project as power purchaser (possibly in partnership with others),
aggregator, or municipal utility, contracting for share of power and/or revenue
F) City owns and/or manages one or more aspects of project, e.g., cable
G) City is represented in wind farm management (e.g., on board of directors)
12 Guaranteeing a specific price to Evanston residents is also only possible if Evanston forms a municipal
utility or sets itself up to aggregate power consumed in the city.
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Working group recommendation: The City should actively explore, and ultimately
define, its role in the project. No model can be ruled out or decided upon at the present time; City
should advocate at state level for maximum flexibility under home rule. Meanwhile, a City
committee or board should explore possible models in detail, especially with an eye to those that
would facilitate the aggregation of a market for the output of the wind farm, that would address
public trust doctrine questions, for which grant funding is available, and/or for which risk-
spreading partnerships are possible, and make a recommendation to the City (a) before the City
propounds an RFP and (b) in time to have input on establishment of the State of Illinois
regulatory framework.
(2) Capital Requirements, Financing & Indicative Pricing. The RFI asked
developers to "describe the City’s role, if any" in a section so titled.
Mercury Wind: Mercury stated that, with the City of Evanston being "financially
challenged … a project of this scope and size would be highly risky and unadvisable for the city
itself to finance." §1.2.1, p. 17.
Off Grid: No discussion.
Comments: The City could have an active role in financing13 or assuring financial
feasibility of the project by (a) using its bonding authority, (b) acting as applicant, sponsor, or
other conduit for federal, state, or private grants, especially in the study phase,14 (c) entering into
pricing agreements, or (d) solely, or with other governmental units, acting as a power purchaser,
municipal utility, or utility financing district. This discussion is bound up inextricably with the
discussion of City role in "business structure." See §E(1) above.
Power purchase – demand at sustainable price -- is typically integral to the economic
feasibility of any wind farm or other power plant.15 Although that calculus will be mainly a
developer's, this group discussed it because it affects City role options and public reception. A
purely private, market-driven development may not be feasible short-term due to current capital
cost and energy pricing. Presently, the regional wholesale electricity cost is relatively low due to
abundant coal and nuclear power,16 and domestic onshore wind, more mature than offshore wind,
13 The New England Wind Power forum has collected a list of federal grant, loan, and tax incentive
resources; some potentially applicable to an Evanston project include the Federal Government Loan
Guarantee Program, Clean Renewable Energy Bonds (CREBs), and the Renewable Energy Production
Incentive (REPI). See also GLWEC Cleveland, supra n.6, ch. 11, esp. §§11.2.6, 11.2.7.9, and at Table 11-
17 (p. 11-48 et seq.).
14 See, e.g., UMaine Receives $12.4 Million for Deepwater Offshore Wind Research Facility,
http://umaine.edu/news/blog/2010/01/08/umaine-receives-12-4-million-for-deepwater-offshore-wind-
research-facility/ (Jan. 8, 2010). Obviously, research university presence helps in winning research grants.
15 GLWEC Cleveland, supra n.6, at 11-24.
16 Current wholesale electricity prices in our region average less than $0.04/kWh, although these costs
fluctuate and have been significantly higher. This is a function of supply, demand, and regulatory
environment. Currently, the U.S. has a projected excess capacity of up to 100GW through 2013, with the
midwestern region including northeastern Illinois accounting for 17GW of that. Bradley, et al., Ensuring
a Clean, Modern Electric Generating Fleet while Maintaining Electric System Reliability (Aug. 2010),
http://www.mjbradley.com/documents/MJBAandAnalysisGroupReliabilityReportAugust2010.pdf, at 6-7.
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now can also offer power for significantly less than estimates for offshore.17
While power costs and wholesale prices from installed plant do not equate 1:1, the
offshore development cost clearly needs reduction, through technological progress, subsidy, or
both, or there is significant disincentive for private investment on a solely profit-driven basis.18
Both government and industry recognize and expect this, and, going forward, price is expected to
drop once the "first-time" costs of uncertainty and U.S. industry ramp-up are past.19 The
Department of Energy has outlined a path to reduce offshore wind costs to 7¢/kWh by 2030.20
Many mechanisms for lowering developer cost involve a role for the state or a local
government as a development partner of some sort, although the federal government has the
greatest means to subsidize, incentivize, or otherwise impact economics of a commercial-scale
offshore project. 21
Working group recommendation: The City needs to explore options and then clarify
and narrow its preferred choices before propounding an RFP.
(3) Timeline. "Describe the City’s role, if any" in "a timeline for development" and "any
uncertainties" in scheduling, potential conflicts, and mitigation strategies.
Mercury Wind: Mercury states that, "The area of obtaining permits is where the City of
Evanston can work on behalf of the developer to cut the timeline in half or at least reduce the
waiting time." §1.6, at p. 50. Mercury previously mentioned, under its discussion of business
17 The EIA in 2010 estimated offshore wind "overnight" capital costs at $4,021/kW, and upped that
estimate 49% for 2011, using mainly ocean-based projects. The EIA also boosted capital cost estimates
for new nuclear and coal plants by 25%-39%. The EIA's location-based offshore wind cost estimates are
currently raw, with the same figure reported for Illinois (Lake Michigan) as for a wind farm in the Pacific
surf off of Ha waii. Energy Information Administration, Updated Capital Cost Estimates for Electricity
Generation Plants (Nov. 2010), http://www.eia.doe.gov/oiaf/beck_plantcosts/pdf/updatedplantcosts.pdf.
The EIA did note that capital cost is only one driver of technology choices, with projected utilization rate,
existing resource mix, capacity value, government policy, and portfolio diversification also affecting
decisions. Id., at 5-6. The Cleveland study analyzed PPA pricings of between 17 and 22 cents/kWh in
order to make the small pilot project attractive to investors.
18 Philanthropists, foundations, or corporations could conceivably invest for non-pecuniary reasons.
19 See generally GLWEC Cleveland, supra n.6, ch. 11. See also, e.g., A. Shah, Offshore Wind Parks –
Costs will Decrease as Capacity Multiplies, Green World Investor,
http://greenworldinvestor.com/2011/04/18/offshore-wind-parks-costs-will-decrease-as-capacity-
multiplies/ (Apr. 18, 2011); Wind power cheaper than nuclear, says EU climate chief, The Guardian
(Mar. 17, 2011), http://www.guardian.co.uk/environment/2011/mar/17/wind-cheaper-nuclear-eu-climate.
Deepwater Wind recently offered to sell the Long Island Power Authority power from an offshore project
at a price in the "low teens." Deepwater Wind may provide electricity to Long Island, cheaper than to
R.I., Providence Journal (May 7, 2011), http://www.projo.com/news/content/DW_LONG_ISLAND_05-
07-11_ESNUPCQ_v22.32d765b.html.
20 DoE Strategy 2011, supra n.5, at 15-16
21 Financial support could take the form of direct subsidies, tax credits, and/or private grants. See n.12.
Additionally, portfolio standards that require utilities to purchase renewable resources raise demand for
such power, especially if the standard includes a “carve out” requirement for offshore wind. A carbon tax
or cap-and-trade regime would make wind power price more competitive with fossil-fuel-based power.
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structure, a CoE role in obtaining FAA and other governmental permits, setting contract
requirements, and aiding the developer in obtaining electrical interconnection permits.
Off Grid: No discussion.
Comments: CoE efforts to help establish a legal framework in Illinois (e.g.,
representation on a state commission to develop recommendations and/or legislation) would
advance the timeline. Identifying ways and means to bridge any gap between current market
price and cost of electricity produced by the wind farm also would move the project forward.
Permitting and stakeholder opposition are significant potential delay factors. City
proactivity in identifying information needs, local steps, local stakeholders and concerns, and
smoothing the path, even before actual response to RFP and choice of developer, could
materially reduce contingencies that could adversely affect the development schedule. The City's
own initial decisionmaking speed is also, obviously, a key factor.
(4) Interconnection. The RFI asked, "In what ways can the City facilitate the
interconnection component of the project?"
Mercury Wind: Mercury under its business structure discussion refers to "aiding the
preferred developer in: obtaining land lease rights… and aiding the developer in obtaining
electrical interconnection permits from the local utility [and h]eloping with obtaining
construction permits and right of way easements to bury electrical interconnection cables under
city streets as they are installed from the offshore wind farm to the substation." Under
"Interconnection," Mercury discusses a "submarine cable from the offshore wind farm substation
…to the onshore electrical substation near the intersection of Dewey and Emerson streets."
Off Grid: No discussion of City role.
Comments: The City can expedite interconnection by identifying in advance all
properties and rights-of-way likely to be impacted. The City should realize that economics
incentivize building as large a project as possible. The working group discussed likely landfall
sites as at the foot of Church Street or Lincoln Avenue. When the project moves forward, the
City can make land available for the termination of the submarine cable and, if needed,
construction of a substation. The City can facilitate the construction of the underground
transmission line to the interconnection point, which most likely would be at ComEd's 345kV
Skokie substation (Church and Laramie), rather than the 138kV Evanston substation on
Emerson.22 In the interim, the City can avoid potentially conflicting projects.
(5) Regulatory Approval Process. The RFI asked, "Please identify any issues of
concern related to the process of obtaining all anticipated permits and approvals for the
development of the offshore wind facility. What key uncertainties are known or anticipated in
this process at the federal, state and local levels and how would they be overcome? Describe the
City’s role, if any."
22 Cable and transformer size needs will depend on the size of the wind farm. See J. Green, A. Bowen,
L.J. Fingersh, and Y. Wan, Electrical Collection and Transmission Systems for Offshore Wind Power
(National Renewable Energy Laboratory, May 3, 2007), www.nrel.gov/wind/pdfs/41135.pdf
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Mercury Wind: Mercury described CoE role "throughout this process" as "petitioning
the State and Federal government to grant the regulatory approval to the preferred developer."
See also Timeline, supra ("The area of obtaining permits is where the City of Evanston can work
on behalf of the developer to cut the timeline in half or at least reduce the waiting time").
Off Grid: "We look to the City of Evanston to insure proper permitting and agreements
on staging areas, land facilities and transmission lines during construction."
Comments: Assuming a developer has lead role in permitting, City sign-offs may be
necessary, and will vary with ultimate role in the project. Title 7, ch. 17 of City code governs
use of the public ways for electrical transmission. However, the City itself will not be applying
for federal and state permits unless it has a formal role as, e.g., pilot project partner or municipal
utility. The City may need to apply or be named as applicant if parts of the project are on City-
owned land, but this would be very limited, perhaps non-existent.
In terms of expediting the process, the CoE can encourage the state's development of the
legal framework for construction of the wind farm, maximizing protections and flexibility for the
City and its residents. City sponsorship or partnership of the wind farm might facilitate agency
review and approval. City leadership in aggregating and communicating information, enabling
hearings, and making facilities available will be a critical factor in managing the known key
uncertainty of stakeholder response.
(6) Environmental Issues and Anticipated Studies. The RFI asked, "Describe the
City’s role in facilitating these studies and data collection, if any."
Mercury Wind: "The city’s roll [sic] in facilitating these studies and approvals should
be two-fold. Granting the developer the necessary permits to collect wind data offshore and
approving the correct organization to conduct the environmental assessments and studies that
still need to be completed."
Off Grid: No discussion of City role.
Comments: The City might have no significant role in environmental assessments and
studies other than minor permitting activity, but could seek grants, e.g., from the Clean Energy
Community Foundation,23 possibly in conjunction with Northwestern University and/or one or
more local or regional not-for-profit organizations, to complete the wind assessment, avian
studies, etc. The City may have superior resources, or may act as a portal, with respect to the
local economic impact aspect of environmental impact studies.
(7) Public Outreach and Stakeholder Engagement. The RFI asked, "Describe the
City’s role, if any" in this topic.
Mercury Wind: No discussion of City role.
23 The Illinois Clean Energy Community Foundation provides grants for feasibility studies and turbine
installations. http://www.illinoiscleanenergy.org/wind/ A new round of funding to federally recognized
501(c)(3) nonprofits and state and local government agencies begins June 15, 2011, with an application
deadline of July 14, 2011. http://www.illinoiscleanenergy.org/how-to-apply/. See also nn. 13, 14 above.
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Off Grid: "We will rely on the City of Evanston to relay to the local public all pertinent
and necessary information during all phases of this proposed project." See also Developer
Expectations of City, infra.
Comments: The City, as representative of and accountable to the public, would play the
central role in identifying stakeholders, establishing and maintaining stakeholder involvement
and support, and aggregating, communicating, and addressing community concerns. City
resources, e.g., as location for meetings and hearings, on its website, in its e-mail
communications, and in its print newsletters, would be natural and logical channels for outreach
and engagement. See discussion at §§E(3) and E(5), supra, and §E(9), infra.
Note that the City could have considerable support in these efforts. The federal
Department of Energy's Wind Powering America program exists specifically as an "outreach and
stakeholder engagement initiative" and encourages, via awards and grants, municipal
development of wind energy. See generally http://www.windpoweringamerica.gov/
(8) Economic Development Opportunities. "Describe the City’s role in facilitating
economic development, if any."
Mercury Wind: "The City of Evanston can aid economic development by giving each
developer a list of companies located in Evanston, Chicago, and throughout Illinois that are
interested in bidding in on the proposed offshore wind farm. There are many construction
companies in Illinois; however, it takes a considerable amount of the developer’s time to seek
out all interested subcontractors. However, the city can access this information in many cases
much more quickly than a developer."
Off Grid: No discussion of City role.
Comments: Wind farms create many jobs, with the greatest number directly created in
the construction period, although the greatest overall impact is in the supply chain.24 Wind farm
construction itself here will likely be staged from a deepwater harbor and one or more large
vessels, possibly constructed regionally, given barriers to Great Lakes navigation. The wind farm
control center will most likely be combined with its maintenance support facilities, also likely
located at a deepwater harbor. Evanston will not benefit directly from deepwater harbor
economic development opportunities, but some residents may become employed in the many
construction-related jobs a wind farm would create over a number of years.
Manufacture of the highly specialized oversized components for the wind farm and its
installation is very unlikely in Evanston. The possibility for light manufacture of the many
smaller components of the turbines, or of other aspects of the supply chain, needs to be explored.
24 Investing in Illinois (May 2011), http://www.windforillinois.org/storage/JEDI%20Report.pdf.pdf;
Illinois Wind Energy Ass'n, Proposed Wind Energy Development Will Bring Billions In Economic
Investment To Illinois (May 3, 2011), http://www.windforillinois.org/news/proposed-wind-energy-
development-will-bring-billions-in-econ.html; North American Windpower, Report: Proposed Wind
Development Could Create Thousands Of Jobs In Illinois (May 4, 2011),
http://www.nawindpower.com/e107_plugins/content/content.php?content.7792; D. Loomis, Wind
Development Provides the Most Jobs of the Various Generation Sources in Illinois,
renewableenergy.illinoisstate.edu/wind/publications/1102%20WorkingPaperWindDevProvidesMostJobs0
30211.pdf (Center for Renewable Energy, March, 2011)
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Planning, architectural, managerial, and financial work created by the project could
conceivably be filled by Evanstonians, and offices located here. Some white-collar personnel
could relocate here at least temporarily. Some economic opportunity exists for City businesses
and residents relating to the underground transmission cable extending from the lakefront to the
interconnection point, including economic activity related to streets work.
Restaurants, hotels, and recreational facilities could all experience positive benefit from
the long, ongoing project. While both developers and the CGE FAQ posited the wind farm, if
first in Lake Michigan, as a tourism driver, most members of the working group discounted this.
Assessing the economic impact is beyond the scope of this working group; the real
question is City role. Evanston at minimum can act as a portal matching suppliers and employers
with vendors and materials/labor resources, advocate with project developers and partners to
locate offices here, and can use the wind farm as a significant branding tool. Space and a nearby
labor force exist for supply chain light manufacturing. The City will have multiple options in
choosing how or whether to pursue or leverage the above opportunities.
(9) Developer Expectations of the City. "Please indicate the roles of the City that, if
not already defined, are desired or required to facilitate the development of the offshore wind
facility."
Mercury Wind: "Mercury Wind does not currently have any expectations from the city
of Evanston."
Off Grid: "We would like to consider the City of Evanston as the 'Project Champion' to
help facilitate all aspects of the project from feasibility to Development and eventual Operation
and to carry out all and necessary task as the Municipal Sponsor."
Comments: National policy documents on the future of offshore wind power repeatedly
speak to the critical role of state and local leadership. Societal and technological change, positive
or negative, as well as its pace, turns on public as well as private support and opposition.
Minimizing costs and maximizing desired benefits of the offshore wind facility for all concerned
depend at least in part on the degree to which the City takes leadership and guides, at minimum,
the public conversation. It is difficult to imagine that such a project could succeed with the City
as a disinterested neutral.
A more active role would be more consistent with the inspiration for the wind farm
project in the first place. An offshore wind farm was the centerpiece, accounting for the largest
proportion of envisioned greenhouse gas emissions reductions (up to 80,379 MTCO2E out of a
potential total reduction of 245,380 MTCO2E), in the Climate Change Action Plan, approved by
the City of Evanston in November, 2008.25
F. Stakeholders and public opinion
As §§A, E(5), E(7), and E(9) above make clear, engagement and communication with
stakeholders becomes a key challenge. The more buy-in, the less delay and cost, the more
attractive the project is to investors, and the greater the opportunities to leverage benefits such as
25 Evanston Climate Change Action Plan, November 2008 ["ECAP"] at 9
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municipal branding. Perhaps more important, such engagement and communication has great
value in its own right to any city committed to the ideals of representative self-government.
The working group identified stakeholders and actors upon public opinion falling into
five general sectors: economic interests (commercial and residential); advocacy interests
(including environmental, neighborhood, or other municipal interests); recreational interests
(boaters, fishers, birders); politicians; and media. Some overlap.
Dozens of stakeholders were initially identified, apart from a media list.26 This list will
expand when and if the City proceeds to the next phase. At this juncture little identified debate
has occurred, but Evanston's active citizenry virtually guarantees some diversity of opinion. No
political opposition was specifically identified at this point. Some groups, officials, and media
have taken positions ranging from mildly supportive to enthusiastic. There have been a few
negative editorials and blog posts, and individual comments, with concern or criticism centered
on the economics, the aesthetics ("view shed"), or perceived avian threats. Some residents have
understandable questions. There is also considerable lack of awareness of the possible project.
Some with experience in the power industry have privately expressed skepticism. Again, City
leadership and communications will be central to shaping public and private perception.
Other American offshore wind studies have already noted the importance of stakeholder
engagement and have collected strategies for engaging stakeholders.27 While full public
engagement may not be productive prior to the receipt of any actual proposal, engagement of at
least key stakeholders earlier in the process can facilitate the development of a consensus.
Working group recommendation: The City, before propounding an RFP, should
amplify the process of public engagement and communication, including the development of
simple tools (such as a website FAQ page) for those purposes, and to dispel misinformation.
26 Preliminary Evanston stakeholder groups identified include Citizens for Lakefront Preservation;
Citizens’ Greener Evanston; Evanston Coalition for Responsible Development; Evanston Township High
School; Northwestern University (administration; faculty; student government; student groups such as
ISEN; residence and Greek councils); Business Alliance for a Sustainable Evanston; Evanston
Environmental Association; Evanston Interreligious Sustainability Circle; Evanston North Shore Bird
Club; Keep Evanston Beautiful; Central Street Neighbors Association; Downtown Residents Association;
Southeast Evanston Association; Evanston Chamber of Commerce; Downtown Evanston; League of
Women Voters (Evanston); neighborhood business associations. Statewide or regional groups include
the Illinois Wind Energy Association; Alliance for the Great Lakes; Citizens Utility Board; Sierra Club;
Audubon Society, Illinois Chapter; Ducks Unlimited, North Shore Chapter; Great Lakes Sport Fishing
Council; Burnham Park Yacht Club; Chicago Yacht Club; Chicago Yachting Association ; Columbia
Yacht Club; Diversey Yacht Club; Great Lakes Yacht Club; Lake Calumet Boat and Gun Club; Lake
Michigan Yacht Club; Lake Michigan Yachting Association; Montrose Bay Yacht Club; Museum Shores
Yacht Club; Sheridan Shores Yacht Club; Southern Shores Yacht Club; Waukegan Yacht Club; Winthrop
Harbor Yacht Club; American Waterway Operators; Lake Carriers Association. Other municipalities
include Chicago; Glencoe; Highland Park; Highwood; Kenilworth; Lake Bluff; Lake Forest; North
Chicago; Waukegan ; Wilmette; Winnetka; Winthrop Harbor; Zion.
27 See the discussion of market barriers and public acceptance at Doe Strategy 2011, supra n.5, at 27-28,
and the plan outlined in chapter 12 of the Cleveland study, GLWEC Cleveland, supra n.6, at 12-1 et seq .
However, generally, public support for wind energy is high in Illinois. Public Beliefs and Opinions: Wind
Energy in Illinois (Center for Renewable Energy, June 2010).
40
Federal Statutes and Agencies Impacting Offshore Wind Projects
Statute Agencies Impact on offshore wind projects
National Environmental
Policy Act of 1969 (NEPA)
All federal agencies Requires federal agencies to consider the potential environmental impacts of
proposed federal actions. For any major federal action that is likely to result in
significant environmental impacts, agencies must prepare an Environmental
Impact Statement (EIS).
Endangered Species Act of
1973
FWS; NOAA NMFS Requires federal agencies to consult with the FWS and NOAA NMFS to
ensure that proposed Federal actions are not likely to jeopardize the
continued existence of any species listed at the federal level as endangered
or threatened, or result in the destruction or adverse modification of critical
habitat.
Marine Mammal Protection
Act of 1972
FWS; NOAA NMFS Prohibits, with certain exceptions, the take of marine mammals in U.S. waters
by U.S. citizens on the high seas, and importation of marine mammals and
marine mammal products into the U.S.
Magnuson-Stevens
Fishery Conservation and
Management Act
NOAA NMFS Requires federal agencies to consult with the NMFS on proposed federal
actions that may adversely affect essential fish habitats necessary for
spawning, breeding, feeding, or growth to maturity of federally managed
fisheries.
Marine Protection,
Research, and Sanctuaries
Act of 1972
EPA; USACE; NOAA Prohibits the dumping of certain materials without a permit from the EPA. For
ocean dumping of dredged material, the USACE is given permitting authority.
National Marine
Sanctuaries Act
NOAA Prohibits the destruction, loss of, or injury to any sanctuary resource managed
under the law or permit.
Coastal Zone Management
Act of 1972
NOAA Office of Ocean
and Coastal Resource
Management (OCRM)
Specifies that coastal states may protect coastal resources and manage
coastal development.
National Historic
Preservation Act of 1966
NPS; Advisory Council
on Historic Preservation;
State or Tribal Historic
Preservation Officer
Requires each federal agency to consult with the Advisory Council on Historic
Preservation and the State or Tribal Historic Preservation Officer before
allowing a federally licensed activity to proceed in an area where cultural or
historic resources might be located.
Federal Aviation Act of
1958
FAA Requires that, when construction, alteration, establishment, or expansion of a
structure is proposed, adequate public notice be given to the FAA as
necessary to promote safety in air commerce and the efficient use and
preservation of the navigable airspace. Establishes BOEMRE as the lead
authority to regulate offshore wind in federal waters. (Note that under the
Federal Power Act, per an MOU between DOI and FERC, FERC has the lead
role in regulating offshore kinetic energy, such as wave energy devices.)
Federal Power Act FERC; BOEMRE Establishes BOEMRE as the lead authority to regulate offshore wind in federal
waters. (Note that under the Federal Power Act, per an MOU between DOI
and FERC, FERC has the lead role in regulating offshore kinetic energy, such
as wave energy devices.)
Ports and Waterways
Safety Act
USCG Authorizes the USCG to implement measures for controlling or supervising
vessel traffic or for protecting navigation and the marine environment.
Rivers and Harbors Act of
1899
USACE Delegates to the USACE the authority to review and regulate certain
structures and work that are located in or that affect navigable waters of the
United States, including submarine cable systems.
Outer Continental Lands
Act of 1953
DOI Granted the Department of the Interior with the authority to lease submerged
lands on the Outer Continental Shelf. The Energy Policy Act of 2005 amended
this act to give DOI the authority to lease renewable energy, including offshore
wind, on the OCS. Prohibits the discharge of oil or hazardous substances into
waters or adjoining shorelines which may affect natural resources belonging
to the United States.
Clean Water Act FWS;
NOAA NMFS
EPA, USCG Prohibits the discharge of oil or hazardous substances into waters or adjoining
shorelines which may affect natural resources belonging to the United States
Clean Air Act EPA, BOEMRE Prohibits federal agencies from providing financial assistance or issuing
approval for activities that do not conform to approved plans for achieving
National Ambient Air Quality Standards. Requires the EPA (or authorized state
agencies) to issue a permit before the construction of, or major modification
to, any major stationary source of air pollution.
41
Mayor’s Wind Farm Committee
Siting and Size Working Group
Working Group Committee Members:
Nicolai Schousboe, Tom Cushing, Nathan Kipnis, Bill Wagner, Tom Carey
Executive Summary of Findings
Off Grid Technologies and Mercury Wind’s responses address some but not all of the
items sought in the City’s RFI. This Executive Summary presents certain highlights of
those full submissions. The detailed analysis of the Working Group is submitted along
with this summary and should be referred to for a full treatment of the issues. In
summary, the responses present the following:
1. Siting: Each response proposes a site 7-9 miles into Lake Michigan, directly out
from the Northwestern campus in Evanston as stipulated in the RFP.
2. Size of Wind Farm: The responses envision an area of approximately 1.5 square
miles to accommodate the wind farm. Mercury Wind proposes 30-80 turbines,
600 feet in height, depending on the electricity capacity chosen for the project.
Off Grid proposes 20 turbines over only 140 acres of the proposed site.
3. Power Capacity: Mercury proposes a capacity of 100-250 Megawatts (MW). Off
Grid proposes 200 MW for the initial project.
4. Visual Impact: Very little valuable, factual information was presented on this
topic. Mercury proposes painting the turbines blue or grey to reduce visual
impact. Off Grid states that their proposed turbines would be low profile and
therefore would not have a visual impact. Off Grid’s proposed turbines are not
fully described nor currently proven in the field.
5. Wildlife Impact: Essentially, the responses state that these are to be determined.
Mercury states that the turbines tend to serve as reefs for the congregation of fish.
Each acknowledges that formal studies will be necessary to determine the impact
on birds and bats.
6. Impact on Boating/Shipping/Aviation: Mercury states that the turbines would be
2000 feet apart and that barges are a maximum 225 feet wide. Mercury indicates
that there will be a 100 foot clearance from the surface of the water to the lowest
point of a rotor blade. At seven-plus miles out, interaction with recreational
boaters would be infrequent. Emergency equipment will be on the turbines, such
as rafts, phones, etc. Aviation likely would not be impacted because the maximum
height will be 600 feet above the surface of the water.
7. Dock Facilities for Construction and Maintenance: The project would require a
deep water port and staging area for construction. The most likely locations
would be Port of Chicago on the south side of the city, or locations in Indiana or
Wisconsin.
8. Electric Interconnection: An off shore substation would be required for each 150
MW of capacity. An underwater cable, buried four feet below the lake bed,
would run to a connection point on shore an then continue under the streets to the
ComEd high voltage substation at Emerson and Dewey. (In fact, interconnection
may need to occur at another location rather than Emerson and Dewey.)
42
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
Project Siting and Size of Facility Working Group
A. SUMMARY OVERVIEW:
This working group was tasked with summarizing the siting and facility size information
presented by respondents to the City of Evanston’s (“Evanston”) “Request for Information”
(“RFI”) for an off-shore wind farm development in Lake Michigan. The Group also has provided
comments where it deems appropriate. The respondents to the RFI include:
· Mercury Wind (“Mercury”) and
· Off Grid Technologies (“OGT”).
The two responses varied in detail and content. In some instances the respondents made
incorrect or unsupported assumptions, or failed to address certain questions altogether. In
others, information outside the scope of the RFI was presented.
Both responses propose wind turbines located within the bounds of the site specified in the RFI.
Mercury’s response suggests a project with a capacity of between 100 and 250 megawatts
using traditional vertical wind turbines. Mercury proposes a location seven to nine miles from
shore, and concludes that a minimum capacity of 100 MW is necessary to achieve economies
of scale and profitability.
OGT proposes the use of large, horizontal turbines (10 MW per turbine) that appear to
represent novel or emerging technology. OGT proposes an initial development of twenty such
turbines that would fill 140 acres of the “796 acre offshore site” located seven miles from shore,1
with an initial capacity of 200 megawatts. OGT also estimates that the total 796 acre project
area could ultimately accommodate one hundred, 10 MW horizontal wind turbines, for a total
potential capacity of 1,000 megawatts.
On the subjects of permitting and environmental assessments, both responses indicated that
permits and site assessments will be required from various government agencies, but did not
identify them with specificity.
1 The footprint of the project area in the RFI is 1.5 square miles located 6 to 9 miles off-shore.
Each square mile contains 640 acres. The total project area of 1.5 square miles, therefore,
contains a total of 960 acres.
43
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
B. ITEMS TO BE ADDRESSED:
Describe the main components that fall under this topic and the facts as the committee
understand them today.
RFI Wind Farm Program Parameters Regarding Proposed Location and Size (RFI Sections
II & III):
· Relative close proximity to Evanston with potential to accommodate large scale
wind energy development;
· Proposed site area of 1.5 square nautical miles (+/- 1.9 square miles);
· Proposed distance from Shore at 6-9 miles directly east of Northwestern
University;
· Assumed available design wind speed of 8 meters/second (“m/s”) (+/- 18mph) at
65 meters (“m”) (+/- 213 feet) above average lake water level: and
· Assumed water depth at +/- 42 – 98 feet below surface at site area.
I. Siting Information Issues Raised in the RFI (RFI Section IIIA):
1. Address Public Impacts, Including Aesthetics (RFI IIIC.3);
2. Effect on Marine Life, Lake Environment and Fishing (RFI IIIC.3);
3. Effect on Migratory Birds (RFI IIIA.5);
4. Effect on Recreational or Commercial Boating (RFI IIIC.3);
5. Effect on Recreational or Commercial Aviation (RFI IIIC.3);
6. Wake Effects on Production and on Component Fatigue Loads (RFI IIIA.5)
(While this may be Siting-dependant it might be more appropriately addressed by
the Technology and Equipment Sourcing Working Group.);
7. Need for One or More Offshore Substations (RFI IIIB.1);
8. Location of Converter Stations (HVDC option), Lake Floor, Routing and Landfall
Considerations (RFI IIIB.1);
9. Address Availability of Appropriate Port Facilities (RFI IIIB.3);
44
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
10. Other Public Impacts: Property Values, Tourism, Public Safety and Security,
Decommissioning and Restoration (RFI IIIC.3);
11. Port Development and Enhancement (RFI IIIC.4);and
12. List of Pre-emptive Site Data Collection & Analysis Supporting Siting
Recommendations (RFI IIIC.2).
II. Sizing Information Issues Raised in the RFI (RFI Section IIIA):
13. Address Public Impacts, Including Aesthetics;
14. Technical Limitations: Foundations, Fabrication, Construction Logistics, Existing
Distribution and Substation Availability, Economy of Scale, Proven Availability or
Dependability in the Market, etc. Size (RFI IIIB.2);
15. Specific Stated Program Requirements: Obtain maximum amount of power, build
to a maximum budget, maximize economic return on investment, etc. Size (RFI
II);
16. List of Pre-emptive Site Data Collection & Analysis Supporting Siting
Recommendations (RFI IIIC.2); and
17. Proposed Incremental Threshold Options and Resulting Pros and Cons.
C. INFORMATION PROVIDED BY RFI RESPONDENTS
The task of this committee was to provide Evanston’s mayor and city council with a summary of
the information provided by each of the RFI respondents as they relate to the key components
of the RFI as described above.
I. Siting:
1. Address Public Impacts, Including Aesthetics:
Mercury:
· Mercury states that placing the turbines 7 miles from shore will reduce “visual impact
by 50%,” and painting them will reduce the visual impact by an additional 20%. No
explanation or bases for those statements are given. P66.2
· Mercury states that if visual aesthetics become a red flag issue, mitigation could
include using floating foundations at 10 miles. Mercury states that at 10 miles the
curvature of the Earth would render the turbines invisible to the naked eye. P 52.
2 The page numbers listed refer to the page numbers in Mercury’s and OGT’s respective RFI
responses where the information presented was obtained.
45
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
OGT:
· OGT states that there will not be a visual impact due to the “low profile” of their vertical
axis design. OGT further asserts that their proposed tower / turbines are “aesthetically
pleasing.” P 24.
Working Group Comments:
Mercury’s statement that the visual impact will be reduced by 50% if the turbines are
located ±7 miles offshore is unclear, especially in light of the RFI statement that the turbine
farm will be located 7 to 9 miles offshore.
Mercury’s statement that placing the turbines ten miles off shore will render them invisible
from shore is not borne out by the calculations of the Working Group.
2. Effect on Marine Life, Lake Environment and Fishing:
Mercury:
· While this issue may exist wherever a project is sited in the Lake, Mercury makes a
case that the underwater structure tends to provide artificial reef areas for spawning
and attracts concentrations of fish based on a referenced study in Europe. Mercury
indicates that with lack of net trawling there should be no “significant adverse affect”
for either commercial or recreational fishing. P67-68.
OGT:
· OGT provides some general description of the lake bed and location of fish but does
not address how to mitigate if there is a problem. OGT further indicates that impacts
on fishing and navigation cannot be determined at this time, but will thoroughly
research during the feasibility phase of the project. P 21, 24.
3. Effect on Migratory Birds:
Mercury:
· Mercury asserts that the greatest density of birds is likely to be closest to the
shore, and “decline dramatically at distances greater than one mile” from the
shoreline, concluding that the wind farm would not be damaging to birds. Mercury
recommends that a field study be performed when further refinements to the
proposed project are completed. Mercury does not indicate how to mitigate
potential effects on migratory birds. P48.
46
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
OGT:
· OGT gives an explanation of how Migratory Birds are banded, migration routes are
determined, and where general routes occur, but does not address how to assess
migratory bird issues and related mitigation steps if necessary. P 21.
Working Group Comments:
No authority is cited by either respondent on this issue. An environmental assessment or
study of any project’s potential impacts on migratory birds certainly would be required. The
project site reflected in the RFI may pose an issue for migratory birds traveling from Canada
south over Lake Michigan. According to Judy Pollack of the Audubon Society, a study has
been initiated recently to look into this issue.
Additionally, there is a concern about bat populations which will require study. An initial
thought on this is that bats, being land-based, are less likely to be impacted at the site over
the water than migratory bird populations.
4. Effect on Recreational or Commercial Boating:
Mercury:
· With regard to recreational boating, Mercury suggests that only a small number of
Evanston residents would ever encounter the facility. (“Very few residents will ever
boat more than 5 miles off shore. It is estimated that less than 2% of Evanston
residents will ever boat on the water.”) P 67.
· On the plus side, according to Mercury, several life saving devices (rafts, lights,
ladders, phones, etc.) would be made available on each turbine for boaters needing
emergency assistance.
· Regarding spacing, Mercury states that there would be 2000 feet between turbines
and that the largest lake barges are 225 feet in width - suggesting that the spacing
would "easily accommodate” the largest barges.
· Mercury states that the lowest point of a rotor would be 100 feet above the water
level, accommodating 95% of all sailboats.
· Mercury indicates that they have consulted with the Coast Guard regarding the
proposed facility and shipping lanes.
· The facility would provide lighted waypoint markers. P 67-68.
47
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
OGT:
· OGT states that they will have a close and consistent engagement with all stakeholders
regarding commercial navigation. P 20, 24, 25.
Working Group Comments:
The Group tends to agree that it is unlikely that a vast majority of recreational boats typically
would venture out seven miles from shore, but wondered about the potential fate of the 5% of
sailboats tall enough to encounter the rotor blades.
5. Effect on Recreational or Commercial Aviation:
Mercury:
· Mercury states it has researched FAA requirements and has preliminarily considered
private, military, and commercial flight issues. All proposed structures over 200 feet
must be evaluated and permitted by the FAA. P 68.
· According to Mercury, the highest point on a turbine blade would be 600 feet from the
lake’s surface. Mercury asserts that most small private planes travel above 3000 feet,
and concludes that “there should be no problem.”
· According to Mercury, commercial aircraft travel above 35,000 feet until they descend, in
preparation for landing, to 3000 feet when they are 15 miles from the airport. P68.
OGT:
· OGT states that they will have a close and consistent engagement with stakeholders
regarding aviation. P25.
Working Group Comments:
With regard to potential small aircraft obstructions, perhaps there should be a more definitive
answer rather than “there should be no problem.”
While further study will be necessary on this subject, there appear to be no ‘red flags’ showing
on this item.
6. Wake Effects on Production and on Component Fatigue Loads (RFI IIIA.5):
Mercury:
48
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
· Based on “industry standard” and assumed wind speeds, Mercury suggested placing the
turbines a distance of a minimum of 7 to 10 rotor lengths apart. Their analysis then
suggested placing the turbines 5 rotor diameters apart in the direction perpendicular to
prevailing winds, and 10 rotor diameters in the direction facing the prevailing winds.
They then calculated the megawatt return per square nautical mile. A final determination
will require the collection of all MET data. P42, 43.
OGT:
· No comments from OGT.
Working Group Comments:
Wake Effect here refers generally to the reduced speed/energy and altered turbulence of wind
caused by its encounter with a turbine.
7. Need for One or More Offshore Substations:
Mercury:
· Mercury recommends an off shore substation for every 150MW of wind turbines and an
interconnection location at an on shore utility substation. The on shore interconnection
substation is where they suggest that responsibility changes from the wind farm owner to
the utility grid owner. P52.
· Mercury made the basic assumption that there would be an off shore substation. P50.
· The on shore electrical substation is assumed to be located at Dewey and Emerson,
which is approximately 1.4 miles inland and owned by ComEd / Exelon. The 1.4 mile
land based cable will need to be buried underground and would therefore need to be
coordinated with the City of Evanston’s roadwork schedule. P52, 53.
OGT:
· The only comment from OGT regarding substations is that the issue will be considered.
P20.
8. Location of Converter Stations (HVDC option), Lake Floor, Routing and Landfall
Considerations:
Mercury:
· Mercury suggests burying the cables from the wind farm 3-4 feet under the lakebed.
The line would come ashore to a small underground cable connection pit and then
proceed to the ComEd high voltage substation at Emerson and Dewey. P53.
49
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
· Mercury recommends an AC interconnection. HVDC (high voltage direct current) is not
cost effective at a distance of less than 50km, as in the proposed case. P52, P53.
OGT:
· No comments from OGT.
9. Address Availability of Appropriate Port Facilities:
Mercury:
· Mercury states that a ¼ mile lakefront facility is required in conjunction with a deep water
port as a staging area for the components. P61-62.
· Mercury Wind suggests either the Evanston shoreline for port development as a staging
area or one of three ports investigated in Illinois, Indiana or Wisconsin. P70.
· The Evanston shoreline lacks the rail connection and deep water facility required for the
project, although Mercury expressed its willingness to build a marina and port for
Evanston at no charge to the city. P 70.
· The option of developing a new marina between Davis/Church and Clark Street beaches
for an O&M facility suggested a development synergy for marina and restaurant to
support the new monitoring facility. P44, 45.
· For operating and maintenance, Mercury identified three “ideal” port locations from
which to perform those functions: Winnetka Electrical Utility Dock, Wilmette Harbor or
the Evanston Dock near Church Street Beach; the closer to the Wind Farm, the better. P
44
OGT:
· No comments from OGT.
Working Group Comments:
The Evanston dock is certainly not a deep water facility, and utilizing Evanston, Wilmette or
Winnetka lakefront for industrial/construction purposes would dramatically alter the character of
those locations. Waukegan, Port of Chicago, Gary, and possibly sites in Michigan could be
plausible port locations.
10.Other Public Impacts: Property Values, Tourism, Public Safety and Security,
Decommissioning and Restoration:
50
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
Mercury:
· Mercury states that impact on real estate value is completely arbitrary, but believes that
property values will increase, based in part on the comparison to Hawaii’s experience,
where there are land based wind farms and where property values are high. P 67.
· “[T]he Federal government believes that turbines increase the property value, therefore,
they tax it. Mercury Wind is not suggesting that the city raise taxes on lake shore
residents, simply noting that property values will increase.” P 67.
· Mercury expects minimal effect on tourism and suggests they would like to conduct tours
for a small fee. They cite wind farms in Hawaii for the proposition that turbines do not
hurt tourism. P 69.
· Mercury suggests benefits to safety and security from the Wind Farm include guidance,
lighting, fog horns, off shore distress phones, off shore inflatable rafts and emergency off
shore boat anchorage points. In the event of a catastrophic power outage the wind farm
provides continued power. P 69.
· Mercury’s investigation suggests decommissioning would take up to 2 years, with six
months for the tearing down of the project and six to twelve months for the restoration of
the site. P 69.
OGT:
· OGT states that public safety and security will be thoroughly researched during the
feasibility phase, but because of the offshore location OGT believes this will not be an
issue. P 20, 24.
11. Port Development and Enhancement:
See responses for item 9. above.
12. List of Pre-emptive Site Data Collection & Analysis Supporting Siting Recommendations:
Mercury:
· Mercury suggests that the number of studies will be as required by the city, state, and
federal government, but that this will be mostly related to permitting. They suggest a 6
to 12 month onsite wind study and a 1 to 4 month interconnection feasibility study.
OGT:
51
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
· Reducing data collection costs are noted on page 20. The goal of partnering with
another company to study the wind feasibility is noted on page 23.
Sizing:
13. Address Public Impacts, Including Aesthetics:
Mercury:
· Mercury anticipates that the public response to the wind farm will be generally positive,
with the exception of a few Evanston residents objecting because of visual impact or bird
migration. Mercury states that the developer will engage key stakeholders who may be
against the wind farm. P66.
· Mercury would paint the turbines light gray or light blue to blend in with the horizon.
P66. See also item C 1. above.
OGT:
· OGT expects that aesthetics and noise will not be a factor because of their unique wind
tower / turbine design. OGT further claims that its proposed wind tower / turbine design
would be “aesthetically pleasing.” P24.
14. Technical Limitations: Foundations, Fabrication, Construction Logistics, Existing
Distribution and Substation Availability, Economy of Scale, Proven Availability or Dependability
in the Market, etc.:
Mercury:
· Foundations: Mercury describes the three main types of off shore foundations
(monopole, gravity and floating) and suggests that the final decision on which to use will
follow a geotechnical survey. They do not recommend a floating foundation as such a
foundation is currently not well proven. P59, 60.
· Fabrication: Did not find specific response but is generally built into the rest of the
document.
· Construction Logistics: Mercury recommends shipping components by rail is cheaper
than by truck, but shipping by barge/ship would be the best method. Any solution would
be dependant on the location of an equipment staging area. P60
52
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
· Distribution and Substation Availability: See response to item number 7 in Siting, above.
· Economy of Scale: Mercury shows analysis of various capacity turbines in chart form,
ultimately recommending the use of 3 to 3.6 megawatt turbines. P 16
· Mercury discusses the ready availability and dependability of wind power, including off
shore wind power, in recent years. P 58, 59. Mercury asserts, “now getting +95%
availability out of your off shore wind farm is not unheard of.” P59.
· Mercury discusses the existing technologies for mounting the turbines, and concludes
that under current circumstances installing turbines more than 9 miles off shore is not
recommended because of water depths greater than 100-120 feet. P 13, 14.
· Note, a chart on page 15 shows that 88% of all offshore wind farms are using monopile
foundations, with 8.5% using gravity types. Floating foundations are an emerging
technology.
· Ice is a concern with offshore wind farms in fresh water. However, Mercury’s RFI
response states that offshore wind farms in fresh water have demonstrated that
foundations can be designed to withstand certain types of ice, using “ice cone’s.” P17.
OGT:
· They state that the year of construction will be 2012. P12.
· They state that the giant turbine systems have the capability to reduce the scale of the
proposed wind farm by 90%. P7.
· OGT proposes to deal with icing via geothermal heating of the interior systems at the
base of each 10 MW system. P16.
Working Group Comments
The Group believes there may be only one offshore wind farm in fresh water subject to freezing,
and that that is a relatively new wind farm. Icing concerns remain an open question.
Construction completion by 2012 is wildly optimistic.
15. Specific Stated Program Requirements: Obtain maximum amount of power, build to a
maximum budget, maximize economic return on investment:
Mercury:
No response from Mercury.
53
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Siting and Sizing
Working Group Committee Members:
Nicolai Schousboe; Tom Cushing; Nathan Kipnis; Bill Wagner; and Tom Carey
OGT:
· The maximum power output from 796 acres using a conventional 3.0 MW turbine will
require only 12.4 acres of space per turbine, therefore providing a maximum of 64
turbines within the 796 acres. Assuming conventional turbines, this provides ‘only’ 192
MW of power. OGT claims that using their turbines in the same 796 acres would
produce 1GW of power using only 100 turbines (from their preliminary data). P8.
· OGT goes on to further state that the largest turbine in the world can produce a
maximum of 5 MW, but that one of their large magnetic levitation (maglev) wind turbines
can produce 1GW (1000 MW) of power, enough to supply 750,000 homes. P9.
· Their ROI is stated to be ‘extremely favorable’ in class wind zones of 4 and 5. P16.
Working Group Comments
The statement regarding breakthrough gains in power from OGT’s proposed turbine raises real
questions given that OGT has no actual installations of this technology. OGT’s assertion that its
system will be more than five times more efficient than proven technology should be considered
with caution.
It is almost inconceivable that a single turbine that could produce 1gigawatt (1000 megawatts)
of power. This may be a typo in OGT’s RFI response. OGT is stating that their system can
produce 200 times the amount of power of a proven system.
Additionally, OGT claims that their proposed system will increase generation capacity by 20%,
decrease operational costs by 50%, and enjoy a lifespan of 500 years, ‘far exceeding the 20-25
years of conventional wind turbine designs.” This does not seem plausible without further
supporting information.
16. List of Pre-emptive Site Data Collection & Analysis Supporting Siting Recommendations:
See responses to C 12. above.
17, Proposed Incremental Threshold Options and Resulting Pros and Cons:
None noted by either Mercury of OGT in their respective RFI responses.
54
MAYOR’S WIND FARM COMMITTEE
Working Group Summary
Topic: Technology and Equipment
Working Group Committee Members:
Deanna Dworak, Kevin Glynn, Kristin Landry, Tim Patton
May 2011
A. SUMMARY
The Technology and Equipment Working Group was asked to consider the responses to the RFI
to judge if technology and equipment questions represent a clear way to distinguish the two
responses and if this viewpoint provides suggestions for the City’s next steps.
1. In general, Mercury’s response described standard, commercially available technology.
Off Grid specifically promoted technology that has yet to be proven at the industrial level
and in a maritime environment. Off Grid claims their technology represents a distinct
advantage over conventional equipment. Mercury’s use of widely available equipment
and approaches implies they will be able to competitively bid the equipment and
construction materials.
2. Both responses are committed to Chicago area job creation, which will help hold down
expenses as the cost to transport much of the material is high and thus needs to be
manufacturer locally.
3. Both respondents expressed unrealistic schedules relative to constructing the necessary
factories, infrastructure and procuring the required specialized equipment.
4. For both RFI respondents and any other developer that enters the discussion, there is no
process to specifically analyze the technology to be used, except in relation to
construction methods (Army Corps of Engineers) and an indirect analysis of the
technology occurs during environmental analysis. Thus, a role for the City going forward
is to demand that the technology being considered is thoroughly analyzed.
5. Mercury has provided clear options for construction. Mercury provides much greater
detail and proposes using conventional maritime construction techniques.
6. Mercury proposes an offshore sub station and provides much greater detail overall about
cabling than Off Grid. Preliminary research by the committee shows cabling strategy
needs to be carefully considered as recent European experience has shown this area needs
more attention than previously thought.
7. Both proposals recognize the need for a commercial deep water port. The closest to
Evanston are the Port of Chicago or the harbor in Waukegan.
8. Both recommend one of the next steps is testing of the wind at the proposed site, both
also describe using commercially available technology.
In conclusion, Off Grid’s unproven technology represents a risk such that if Off Grid were to
continue in the process, the City should require more stringent analysis than conventional
technology such as proposed by Mercury.
55
Technology and Equipment Working Group version 1 2Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee General The City’s intent in issuing this RFI is to identify potential partners, determine the City’s role and establish a process for the development of a renewable energy facility off Evanston’s Lake Michigan shore. Timeline & new Technology: will the project be dependent upon R&D still to be completed? Please identify a timeline for development. Address any uncertainties in scheduling, potential conflicts and associated mitigation strategies. Describe the City’s role, if any. The expected Evanston wind farm construction will commence in 2011, 6 -12 months after all MET tower data is collected if all mandated approvals and permits have been secured. Commissioning of the last turbine will be on or before December 2012. See the itemized activity schedule in Table 6.1.1. The project schedule for major activities is subject to contingency scheduling for potential delays. Mercury Wind has developed a 40-week project schedule outlining all of the major design and construction tasks. (pg 48) Manufacturing plant can be located in south Chicago area along the lake front and can produce up to four 10.0 MagRay turbines per month once full production is attained with a ramp up period of 12 months or less. Current development estimates for completion of the facility is 36 months after the initial feasibility study is completed. (pg 17) These are both highly aggressive schedules that are likely unrealistic, given constraints to build a factory and procure the necessary equipment. 56
Technology and Equipment Working Group version 1 3Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Regulatory Approval Process & Technology: Does the technology require special permits beyond current permitting Please identify any issues of concern related to the process of obtaining all anticipated permits and approvals for the development of the offshore wind facility. What key uncertainties are known or anticipated in this process at the federal, state and local levels and how would they be overcome? Describe the City’s role, if any. These regulatory permits from local government, state government, and the Federal government will be the most difficult aspect of the project. As of this moment, no offshore wind farms have been constructed in the U.S. Therefore, there are many uncertainites as to navigating the permit process. The first step is for the City of Evanston to award a development contract to construct an offshore wind farm. The second step would be getting the approval at the state level. The third and final step would be getting approval at the Federal level. The city’s roll throughout this process is petitioning the State and Federal government to grant the regulatory approval to the preferred developer. The key uncertainties that are not known at this time are: A. Who grants approval at the local level? B. Who grants approval at the State level? C. Who grants approval at the Federal level? D. Which entity receives the tax revenue from the wind farm? E. Who grants the leasing rights and determines the length of the leasing rights in Lake Michigan? F. What entity receives the annual leasing fees of Lake Michigan? General Planning approval by all government agencies Department of energy, Illinois Department of Energy, Department of Interior, Minerals Management Service, Federal Energy Regulatory Commission (FERC),National Renewable Energy Laboratory (NREL), Council on Environmental Quality (NEPA), U.S. Fish and Wildlife Service (FWS), National Oceanic and Atmosphere Administration (NOAA), U.S. Environmental Protection Agency (EPA), U.S. Army Corps of Engineers, (ACOE) River & Harbor Act of 1899, National Park Service (NPS) Coast Zone Management Act (CZMA),Great Lakes Wind Collaborative (GLWC) committees, other governmental regulatory or Administrative agency, court, commission, department, board, or other governmental subdivision, State Legislature, rulemaking board, tribunal, consideration. (pg 20) There is no process to specifically analyze the technology to be used, except in relation to construction methods (Army Corps of Engineers) and an indirect analysis of the technology occurs during environmental analysis 57
Technology and Equipment Working Group version 1 4Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Environmental Issues and Anticipated Studies: Can the technology increase or decrease threats to the environment? Describe the City’s role in facilitating these studies and data collection, if any. The city’s roll in facilitating these studies and approvals should be two-fold. Granting the developer the necessary permits to collect wind data offshore andapproving the correct organization to conduct the environmental assessments and studies that still need to be completed (pg 21) We would like to consider the City of Evanston as the ”Project Champion” to help facilitate all aspects of the project from feasibility to Development and eventual Operation and to carry out all and necessary task as the Municipal Sponsor. (pg 25) question was not specifically asked of developers in RFI, so response is not available. Clearly the choice of technology can influence the impact of the wind farm on the environment, however a comparison of the two offerings is difficult without having asked the question more directly 58
Technology and Equipment Working Group version 1 5Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Economic Development Opportunities: Does choosing one technology over another increase the jobs generated in Evanston? Describe the City’s role in facilitating economic development, if any. Mercury Wind desires to use as many local experienced companies for the proposed wind farm project as possible. Cranes will be rented locally, electricians, electrical engineers, civil engineers, marine engineers, architects, lawyers, construction companies, barge companies, and many other companies will need to be contracted. Many of the companies that can be hired to complete this project are located in Evanston, Chicago, or the state of Illinois. While Mercury Wind Energy recognizes that some offshore engineering and consulting expertise will be hired from Europe, the majority of the offshore wind farm project can be completed with American Labor. (pg 70) We expect to develop a turbine manufacturing facility within the state of Illinois. Numerous opportunities will present themselves as a result of a manufacturing facility to supply the Great Lakes wind developments that unfold in the future. . (pg 25) Mercury is more bullish on job creation for Evanston. Both are committed to using a supply chain in the greater Chicago area and Midwest 59
Technology and Equipment Working Group version 1 6Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Footprint of wind farm Technology Availability and Limitations – Given the facility’s proposed location, please describe any expectations or concerns about technology related items, including the size 1.14 miles x 2.27 miles proposed (pg 51) MagLev Wind Turbine Technologies (MWTT) advanced design of the giant wind turbine concept of kinetic magnetic levitation systems embodies wind energy acceleration components to provide a higher output of wind into kinetic wind generation for the production of electricity through innovative engineering concepts. The giant turbine systems have the capability to reduce existing wind farms scale of size for large land acquisition by up to 90% making it the most cost effective energy plant in the world. (pg 7) Off Grid claims a distinct advantage here; that their technology reduces the overall area needed 60
Technology and Equipment Working Group version 1 7Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Source of turbines & related components. Are the sources local and are there competitors? please describe any expectations or concerns about….availability, and suitability of commercial offshore wind turbines, proposes sourcing from Illinois, Wisconsin, Indiana and other local vendors. (pg 70) OGT and MWTT plans to build a new facility in the Chicagoland area to gear up for the Great lakes off shore development,as well as other parties such as developers, who will wish to purchase our 10.0 MagRay turbine. OGT & MWTT JointVenture will practice supply side manufacturing in the central area for staging of wind turbine onshore & off shore projects.Situating a turbine production plant near a shipping facility eliminates limitations moving giant turbine parts overland to siteswith large populations. (pg 17) no competitors for Off Grid's technology. Mercury proposes to use widely available technology Construction and operating method please describe any expectations or concerns about….special logistical considerations, lengthy discussion beginning pg 61 has indentified a construction partner (pg 17) Mercury's approach uses conventional technology. Both require specialzed vessels for construction that do not exist in the USA. Lakebed construction please describe any expectations or concerns about….foundation requirements lengthy discussion beginning pg 61 not specifically addressed Mercury has provided clear options for construction, Off Grid has not. 61
Technology and Equipment Working Group version 1 8Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Cost: does technology choice drive significantly different costs? please describe any expectations or concerns about…. cost considerations lengthy discussion beginning pg 41 The giant turbine systems have the capability to reduce existing wind farms scale of size for large land acquisition by up to 90% making it the most cost effective energy plant in the world. (pg 7) Off Grid claims distinct advantage due to technology. Risk of technology choice and support from vendors please describe any expectations or concerns about….quality, durability and manufacturer warranties of equipment. Off Grid would be a single cource supplier du eto technology choice. Off Grid specifically mentions the use of rare earth metals, which is an extremely expensive commodity Does technology choice influence the infrasture, including maritime assets for the project? Please provide information related to the infrastructure required to execute the construction and maintenance phases of the facility. lengthy discussion beginning pg 61 question is not directly answered (pg 190 Mercury provides much greater detail and proposes using conventional martitime construction techniques 62
Technology and Equipment Working Group version 1 9Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Where will the material, labor and ongoing maintenace be sited? Does choice of technology influence port siting choice? Address specialized equipment needs and availability, availability of skilled labor and trained crews lengthy discussion beginning pg 61 Chicago area (Pg 17) Both proposals recognize the need for a commercial deep water port. The technology choice may influence the port operations choice, depending on the skils needed and the size of vessel required for maintenace and repair What technology will be used for interconnections? Is is proven? Address specialized...laying of cable interconnection pg 64 …..to construct its facilities or systems in accordance with applicable specifications that meet or exceed those provided by the National Electrical Safety Code, the American National Standards Institute, IEEE, Underwriter's Laboratory, and Operating Requirements in effect at the time of construction and other applicable national and state codes and standards. (pg 17) Mercury proposes an offshore sub station and provides much greater detail overall about cabling than Off Grid. Reviewing European activities, there I a growing awareness in Europe toimprove the cabling technology and maintenance requirements. This needs to be specifically addressed in teh future, but is not an immediate concern 63
Technology and Equipment Working Group version 1 10Mayor's Wind Farm Committee Technology and Equipment Working Group Responses to RFI regarding the Role of the City in the Proposed Off Shore Wind Farm Topic Excerpts from the City’s RFI regarding City’s role in the Project Response of Mercury Wind Response of Off-Grid Technologies Comments and Observations by Committee Can the technology be insured effectively? Often new technology carries higher risk premiums. Address specialized….insurance matters lengthy response pg 35 estimates onpg 14 The working group is unable to address this directly. Insuring a project of this type is both expensive and complex and depends on many variables. Technology selection may and likely would influence the insurance costs by the developer. Has the technology been proven to function/operate in our climate? Address specialized...potential weather and other seasonal impacts on construction, maintenance, production and availability discussed throughout proposal not specifically addressed Mercury touches on this, but offshore wind has only been sited in one lake that has signifcant ice - Lake Vanern in Sweden. Testing technology Both describe the need for testing the wind speed at the site. Both describe reasonable and commercially available technology. 64