Shortly after a developer pulled out of a major Connecticut offshore wind project, state officials announced Wednesday they have signed an agreement with Massachusetts and Rhode Island to coordinate future wind turbine development in the ocean.
The states hope they will be able to cut costs, by jointly seeking bids from companies that want to build larger wind projects.
The new multistate agreement, which could become a model for other parts of the country, comes as some offshore wind developers are seeking to renegotiate contracts they signed with states in 2019 and 2020 when costs were lower. Those costs include the price of steel needed for wind turbines and higher interest rates.
The states have been discussing this for some time, Connecticut Department of Energy and Environmental Protection Commissioner Katie Dykes said.
"All of our states share strong commitments to offshore wind," she said. "We know how important it is to meet our clean energy targets. But we also increasingly know how important it is and is going to be for increasing the reliability of the grid."
When it recently pulled out of the Park City Wind project, Avangrid cited inflation, supply chain problems and high interest rates. Lamont said the state plans to seek bids again for the project in early 2024.
But on Wednesday, Avangrid praised the multi-state collaboration.
"This bold procurement strategy rises to the level of urgency the moment demands while providing offshore wind developers an opportunity to leverage economies of scale that will unlock more competitive bids," the company said in a statement.
Environmentalists praised the deal Wednesday, noting the need for states to work together to lower the costs of developing offshore wind.
"Today’s announcement is a bold way to drive cost efficiencies for projects across a broad swath of New England while promoting economic growth, enhancing security, and driving down energy costs," Jason Grumet, CEO of the American Clean Power Association, said in a statement.
Energy developers will have until January to submit proposals to be considered for multi-state offshore wind projects that can generate up to 6,000 megawatts. Under the agreement, any two or three states will be able to choose a multi-state proposal and split up the anticipated energy.
This story has been updated. Connecticut Public Radio's Patrick Skahill and The Assocaited Press contributed to this report.
