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  • Politically Connected Company Wins Offshore Wind Lease Despite Setbacks

    A politically connected renewable energy company has received the go-ahead from the Interior Department to produce wind energy off the coast of Delaware, despite doubts that the project in question will actually materialize.

    Interior’s Bureau of Ocean Energy Management announced Tuesday that it had reached an agreement with NRG Bluewater Wind, a project of NRG Energy, to lease 96,430 acres off the coast of Delaware for commercial wind energy production.

    But it’s not clear that NRG will be able to secure the financing needed to actually produce energy in that area. The company was forced to cancel a power purchase agreement with Delmarva Power in December after it failed to find financing for the Bluewater project.

    While NRG attributed that setback to uncertainty over federal support for wind energy, Matthew Kaplan, associate director at IHS Emerging Energy Research, noted that it illustrated “the difficulty of persuading utilities to buy offshore wind power in quantities and at rates that make sense to both buyers and sellers.”

    The 200 MW of power Delmarva agreed to purchase from NRG Bluewater “was less than NRG wanted to sell and at a rate that was a lot more expensive than the utility would have to pay from other sources,” Kaplan noted, citing other market researchers.

    The Bluewater project will not move forward until NRG can find financiers. Company spokesman David Gaier said the lease would help woo investors, but would not confirm that the Delaware wind farm will actually be built.

    While the Bluewater project is riddled with uncertainties, NRG Energy is a frequent beneficiary of federal backing – it received three loan guarantees worth a combined $3.8 billion through the same program that helped finance bankrupt solar company Solyndra – and it enjoys a few notable political connections.

    The day before BOEM announced its Bluewater lease agreement, NRG executive Jason Few announced he would leave the company for unspecified reasons. Few’s wife is a major campaign bundler for President Obama. Few and NRG chief executive David Crane met with White House official Valerie Jarrett in the West Wing in December 2010, White House visitor logs show.

    NRG also enjoys the influence of Kathleen McGinty, who sits on the company’s board of directors. Scribe has noted McGinty’s impressive political resume before:

    The former chair of the White House Council on Environmental Quality and the founding director of the White House Office on Environmental Policy, McGinty is a “protégé of Al Gore,” according to the Pittsburgh Post-Gazette.

    White House visitor logs show that McGinty, who also served as a senior advisor to the DNC, met with Nancy Sutley, chair of the White House Counsel on Environmental Quality, in 2010 to discuss the National Environmental Policy Act (NEPA).

    Dr. Karl Hausker, McGinty’s husband, is a former deputy assistant administrator at the Environmental Protection Agency. He also represented the EPA on the White House Climate Change Task Force.

    Posted in Featured, Scribe [slideshow_deploy]

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