Connecticut Gov. Ned Lamont’s decision to abstain from participating in the most recent tri-state offshore wind solicitation, along with Massachusetts and Rhode Island, is sure to engender criticism from those who question whether this choice aligns with Connecticut’s renewable energy goals.
However, Lamont should be commended for doing what elected officials are supposed to do—listen to their constituents.
Connecticut ratepayers have recently been hammered by electricity rate increases driven entirely by public policy decisions made by elected leaders. The monthly electric bill for a typical household has surged for many customers by hundreds of dollars, in some cases doubling as a result of decisions made by Connecticut policymakers on everything from nuclear power to pandemic relief measures. Families across the state are footing the bill and suffering the consequences at a time when costs are already too high, and the lingering effects of the highest inflation in 40 years are straining budgets.
This brings us to offshore wind, which has an important role to play in Connecticut’s energy future. But right now, the costs are just too high, and families across our state can’t be asked to pay even more. By pausing offshore wind commitments, the governor is rightfully acknowledging that the current state of the offshore wind industry, with high interest rates, supply chain bottlenecks, less-than-ideal construction costs and permitting uncertainty, makes this a bad time to invest.
On this, Lamont should stick to his guns. Technically, Connecticut still has the option to buy in, particularly on Vineyard Wind 2, which has an 800-Megawatt commitment from Massachusetts but needs Connecticut to buy in another 400 MW to move forward.
Unfortunately, the extended construction timeline of the Vineyard 2 project creates additional opportunities for things to go wrong. It is no secret that energy projects with more mature and contracted development stages offer a higher likelihood of success—and cost containment. Mature projects come with solidified supply chains, finalized interconnection agreements, and a more certain permitting processes—elements that significantly reduce the risk of cost overruns and delays.
Massachusetts provides a compelling case study in this regard. The Bay State selected projects that had robust supply chains and well-defined regulatory and permitting pathways. Connecticut could have bought in on these projects but declined to do so. Why then would the state consider buying in on a project that brings more risk, a longer timeline, and likely higher costs?
Furthermore, the current proposal has yet to begin its long, arduous permitting process. Should former President Trump prevail in the forthcoming election, and make good on his promise to impede the offshore wind industry, Vineyard Wind 2 could be looking at a four-year standstill, making its already ambitious commitment to finish the project by 2031 impossible. Project timelines could extend into 2033 or 2034, further adding to the uncertainty and risk.
Additionally, the project’s interconnection agreement is still under study by ISO New England. Without that, there is no cost certainty regarding the interconnection, which could amount to hundreds of millions of dollars in additional costs for Connecticut families. The uncertainty over the agreement introduces another variable that could add significant financial and logistical risks, further complicating the project’s outlook.
The project also lacks a local host community agreement to connect it to the grid. Without that, there is every potential for opposition from communities where infrastructure will be developed, which adds another impediment to timeliness and affordability.
The global offshore supply chain remains a challenge. It has yet to be determined if the project developer, Copenhagen Investment Partners, has established a reliable supply chain supporting construction. This exposes Vineyard Wind 2 to fluctuations in material costs, inflation, and interest rates, which has sunk projects in nearby New Jersey.
Connecticut needs offshore wind in the future, but at the right time and at the right price. Vineyard Wind 2 can offer the state neither.
Lamont’s cautious, smart approach should not be viewed as a retreat from Connecticut’s renewable energy goals, but rather a strategic delay by a man whose business instincts have served him well. By opting out of the current solicitation, Lamont is positioning Connecticut to capitalize on future opportunities when the offshore wind industry is on stronger footing. This approach will allow the state to participate in procurements with more advanced projects that offer better financial terms, clearer regulatory path, and more secure supply chains.
By waiting for a more opportune moment, Lamont is ensuring that any future investments in offshore wind will be both cost-effective and aligned with the state’s broader energy strategy. Entering into a bad agreement will hinder, not advance, the state’s goals and add another burden to Connecticut families that are already paying too much for the state’s public policy decisions.
Marc Brown is northeast executive director for Consumer Energy Alliance.
