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Wave energy proposed off Block Island

12:27 PM EST on Friday, December 5, 2008

By Peter B. Lord

Journal Environment Writer

A Washington-state company has surprised local officials by filing an application to build a vast wave-to-energy project costing $400 million to $600 million in U.S. waters south of Block Island.

Grays Harbor Ocean Energy Co. filed a permit application with the Federal Energy Regulatory Commission to erect 100 structures similar to offshore oil platforms in a 96-square-mile area 12 to 25 miles south of Block Island. The structures would use wave energy to pump air through turbines to create electricity.

The company says it plans to transmit the electricity to Block Island, and to the mainland at Jerusalem.

Grays Harbor simultaneously filed applications for similar projects in California, Hawaii, Massachusetts, New York and New Jersey. It hopes the federal government will treat all the projects as a single entity — one that would make it the largest new energy project in the country.

“It’s a hell of a time to try to do something like this because everyone is going broke,” said Burton Hamner, who has 40 years of experience with coastal and energy projects.

He said his company has been preparing its plans for several years and developed a technology that works. A decision by the federal energy agency on Oct. 16 to claim sole authority over offshore wave-energy projects prompted him to move quickly.

“Now, it’s a homestead process,” Hamner said. “You stick your stake out there. We were the first to identify a good site and put a box around it.”

Rhode Island officials got word of the proposal this week, and that was through the Minerals Management Service, a federal agency that has been regulating offshore wind farms.

The proposal came as a surprise because the state’s Coastal Resources Management Council has been working in conjunction with the MMS on a two-year ocean mapping project to properly site a wind farm offshore. In September, the state selected Deepwater Wind, of New Jersey, to develop a $1.5-billion wind farm in coastal waters that will be delineated by the CRMC mapping process.

The MMS has insisted that the Energy Policy Act of 2005 gave it jurisdiction over all renewable-energy projects in federal waters. FERC disagreed. The agency has a long history of regulating hydroelectric projects inland, and it believed it had the same authority in federal waters.

On Oct. 16, FERC announced that federal law also gave it jurisdiction over hydroelectric projects on the continental shelf. (Nicholas Pardi, spokesman for the MMS alternative energy section, says his agency still believes it has authority over all alternative energy projects offshore, so it continues to try to work out an agreement with FERC.)

Nevertheless, the FERC announcement prompted Grays Harbor to file its applications in Washington, D.C.

In Rhode Island, local officials were concerned because they said they weren’t properly notified. Also, they aren’t happy that FERC is taking the lead on wave power because many feel the agency was highhanded in approving a liquefied natural gas project for Fall River that was opposed by a wide range of state, federal and local government agencies.

A further concern was raised because the Grays Harbor application mentions the possibility of the company adding wind turbines to its wave structures once they are erected.

Grover Fugate, executive director of the CRMC, wondered whether the Grays Harbor application was using the water-power application as a means to lock up miles of offshore water for eventual development of a wind-power project.

Hamner said he was surprised that FERC issued the notice for comment so quickly. It never moves that fast, he said, and he hoped the announcement wouldn’t go out until after Barack Obama was sworn in as president.

Hamner conceded that there is not enough wave energy in Rhode Island waters to make his project economically viable. He said he fully intends to seek permission from MMS to put wind turbines on the platforms he wants to set up.

Celeste Miller at FERC said local officials have not been notified yet because FERC hasn’t formally accepted the permit application. However, FERC issued a notice of the application dated Nov. 28 and gave parties 60 days to respond.

Grays Harbor was founded in 2007 in Seattle to develop large offshore renewable-energy projects focused on the United States.

It obtained a preliminary permit for two demonstration projects off Washington State last July.

Grays Harbor said it identified the seven proposed sites, including Rhode Island, near high-cost power markets, where it says offshore wind/wave power would be economically competitive.

It says all seven sites could be managed as one project by the company. The total construction cost would be $20 billion to $30 billion and net cash flow would range from $3 million to $5 million annually.

The company says it is not proposing wind power initially, because FERC does not regulate wind power. “But wind turbines could be added to the platforms under regulation by FERC.”

“All the sites are in federal waters and use the same technology package and layout, and therefore should be managed as one project at the federal level, with site-specific management at the regional level,” the company says.

For the Rhode Island project, the company says it is applying for a five-year permit to allow installation of two platforms as a pilot project. During the five years, the company plans to apply for a full commercial license.

The company says its platforms would only be visible from shore a few days a year, under extremely clear visibility conditions.

It also said it would make every effort to construct its platforms in the Providence area.

Miller says FERC generally gives out commercial licenses for periods of 30 to 50 years. But the Grays Harbor proposal is a long way from getting such a license, she said.

For more information on Grays Harbor, go to its website: http://graysharboroceanenergy.com.

plord@projo.com

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