Highlights
In December 2016, the Block Island Wind Farm, located off the coast of Rhode Island, became the first operational offshore wind farm in the country. Block Island is a popular tourist destination and home to the town of New Shoreham. The original developer of the wind farm, Deepwater Wind, agreed to a community benefits agreement (CBA) with New Shoreham, stipulating that Deepwater Wind would build a transmission line to transmit wind power and link Block Island to the mainland for the first time and co-install a fiber optic cable to bring broadband internet to the island. The town secured a host of other benefits in the agreement, including infrastructure improvements, a project labor agreement, and two $1.25-million donations to the local historical society and the Southeast Lighthouse Foundation. However, perhaps the most unique aspect of the Block Island Wind Farm CBA was how the developer engaged with the community: Deepwater Wind hired a full-time community liaison to listen to and share information with the community, and funded technical consultants to help community members formally express their concerns.
Context
- Project title: Block Island Wind Farm
- Location: New Shoreham, Rhode Island
- Sector: Offshore Wind
- Developer: Deepwater Wind, acquired by Ørsted in 2018 after Block Island project was completed
- Type of project agreement: Community benefits agreement
About the Project and Involved Stakeholders
Block Island is synonymous with the town of New Shoreham, a small community of around 1,000 year-round residents that swells to more than 10,000 during summer tourism season. In 2009, the Providence-based developer Deepwater Wind was selected by the state of Rhode Island to construct the Block Island Wind Farm to demonstrate the viability of offshore wind in Rhode Island and model how to navigate the permitting process. The 30-megawatt (MW) Block Island Wind project consists of five 6-MW turbines located 2.9 miles south of the island and a 34.5-kilovolt submarine transmission cable from Block Island to the Rhode Island mainland. The transmission cable connected the island to the mainland electricity grid for the first time and dramatically lowered electricity costs for island residents by allowing the import and export of electricity. The New Shoreham community proposed a CBA to ensure that the project would provide tangible benefits for Block Island residents and businesses.
The following analysis is based on interviews with Block Island residents, a comprehensive literature review, published permitting materials, and communication with other Rhode Island stakeholders. The CBA for this case is not publicly available, limiting opportunities to evaluate how closely the language in the agreement matches publicly available information about the project and information shared by project stakeholders. We endeavored to back up all claims contained within this analysis using primary source material wherever possible.
Engagement
In 2009, Rhode Island signed a Joint Development Agreement with Deepwater Wind, signaling the company was the state’s preferred developer for two offshore wind farms. Commissioned by the Governor of Rhode Island, the primary goal of Block Island Wind Farm was to improve electricity reliability and environmental quality on the island. This project would establish a local clean energy source, connect the island to the mainland electric grid, and shutter the polluting diesel generators which powered the island and experienced frequent power surges and brownouts.
Prior to project permitting and construction, Deepwater Wind was required by the state’s Administrative Procedures Act and the Rules and Regulations of the Coastal Resources Management Council (CRMC) to hold a public hearing on the proposed project. The CRMC also created a statewide Special Area Management Plan (SAMP) with the goal of balancing the development and protection of Rhode Island’s ocean resources. The SAMP requires proactive engagement between the CRMC, the developer and the public, and allows the public to provide recommendations for the siting of offshore wind. Beginning in 2010, the SAMP outlined the state’s coastal management plans and included guidelines for offshore wind projects such as Block Island.
Deepwater Wind and the state held public meetings regularly on the island and mainland from 2009 to 2012, providing a forum for local, state and federal stakeholders to learn about, plan and discuss the proposed wind farm. Beyond holding the mandatory meetings for permit approvals, Deepwater Wind met with various interested and affected parties, including the fishing, shipping and recreational industries, environmental organizations and residents of New Shoreham.
The New Shoreham Town Council delivered community concerns about the proposed wind farm to Deepwater Wind, which included: 1) why the $700,000 application fee was waived; 2) the project’s potential environmental impacts and decision to undergo an environmental impact assessment instead of a more robust environmental impact statement; 3) concern that the cost of the transmission line and substation that would be passed on to Block Island ratepayers; 4) the overall aesthetics; and 5) the eventual decommissioning of the project.
The Council did not have the technical expertise to review the project plans or explain the proposal to residents, so it hired consultants to help. Deepwater Wind agreed to reimburse the Council for this expense as part of its CBA with the town. The New Shoreham Municipal Energy Committee was also heavily involved in the project development process. Formed in the early 2000s, the committee is made up of five community members with a professional background or special interest in energy. Deepwater Wind met with the committee, which hosted additional public meetings and made recommendations on the project to the Town Council.
In 2009, Deepwater Wind hired New Shoreham resident Bryan Wilson to serve as community liaison — hosting community informational meetings, answering questions in daily office hours and facilitating community involvement in the project. As a native of Block Island, Wilson had the respect of locals and an understanding of the community’s needs. Our interviews with New Shoreham residents highlight the critical role the community liaison played in educating the community on different aspects of the project and empowering community members to participate in the wind farm’s development. According to one interviewee, “The smartest thing [Deepwater Wind] ever did was hire an actual local, Bryan Wilson, who had been on the Town Council and who lived on the island. He had been following the [New Shoreham Municipal] Energy Committee and was the point person for the island.”
Ultimately, the New Shoreham Town Council voiced support for the wind farm, concluding it would “provide significant economic and environmental benefits to Block Island,” including lowering electricity rates, reducing dependence on high-polluting diesel generators, and increasing resiliency. Before the wind farm, the island experienced frequent blackouts and brownouts during periods of high demand. The elimination of reliance on imported diesel has reduced the frequency of brownouts.
Benefits
Before the Block Island Wind Farm was proposed, the New Shoreham Town Council had spent years advocating for a transmission line to mainland Rhode Island which would end Block Island’s dependence on loud, polluting and unreliable diesel generators by connecting them to the mainland grid. However, the high costs associated with building such a transmission line had been the primary barrier. As a result, when CBA negotiations began, the Town Council worked to ensure the wind project would finally connect Block Island to the mainland.
Key benefits of the Block Island Wind Farm CBA include:
More Affordable and Reliable Electricity
The main benefit New Shoreham residents wanted was lower and more predictable energy prices. Block Island is now fully powered by the five offshore wind turbines, with just 10% of the wind farm’s capacity meeting all of Block Island’s electricity needs, and the remaining 90% exported to the mainland. This is a significant benefit: The project is estimated to reduce electricity rates by 40% for Block Island residents, who previously paid up to 4 times the electricity rates of the mainland. When the project was proposed, islanders were expected to each save $140 per month. No longer reliant on fluctuating diesel prices, residents have reported more stable electricity bills. One longtime resident credits the wind farm with greatly improving electricity reliability on the island, saying “It was really bad for the business community to have that kind of energy instability. It constantly surged and went up and down. As a business owner and somebody who lives [on Block Island], I’d much rather have stable energy and to know what my energy bill is going to be for the next month. Now the power isn’t going out three times a year.”
Environmental Quality
The replacement of the five diesel generators that previously powered the island improved air quality, lowered emissions and reduced noise pollution. Those who lived near the generators — which were located less than half a mile from downtown New Shoreham — reported frequently having to scrub soot from their houses. The wind farm also eliminated the need to import 1 million gallons of diesel a year to supply the generators.
Infrastructure Improvements
In the CBA, Deepwater Wind agreed to fund infrastructure improvements at the spot on the island where the cable comes ashore. As a result, the developer funded the burial of some overhead utility lines. The town manager negotiated the inclusion of broadband fiber optic cables in the transmission line connecting mainland Rhode Island and Block Island for exclusive use by the town, adding an estimated $2.5 million in costs for the developer. Access to high-speed internet was revolutionary in the provision of services by schools, government offices and healthcare facilities.
Local Economy
In addition to the CBA, Deepwater Wind signed a project labor agreement, guaranteeing approximately 300 jobs for 10 different building trade unions and 30 unionized contractors and subcontractors during project construction.
During the public engagement process, Block Island residents and fishermen raised concerns about the potential fisheries impacts of the wind turbines. Rhode Island mandated Deepwater Wind pay for a third-party study of fisheries impacts. No adverse impacts were found, and in fact the base of the wind turbines has created an artificial reef that has increased fish activity in the area, increasing opportunities for local fishermen.
Finally, the community also secured from Deepwater Wind two donations of around $1.25 million each to the local historical society and the Southeast Lighthouse Foundation to strengthen historic preservation and tourism vital to the island’s economy.
Oversight and Enforcement
According to the terms of the CBA, if Deepwater Wind fails to remedy any issue that leads to costs being subsequently incurred by the town, the developer must reimburse the town. In the first year of operation, the transmission cable on Block Island came unburied. The developer quickly fixed the cable and covered all associated costs.
Deepwater Wind was acquired by Denmark-based Ørsted Energy in 2018. While not the original developer, Ørsted has continued to uphold the community benefits agreed upon between Deepwater Wind and the community. Ørsted has also continued to invest locally throughout the lifetime of its portfolio of projects and has demonstrated a commitment to community engagement and benefits in its own offshore wind development projects. For example, Ørsted’s Sunrise Wind project, currently under construction in Brookhaven, New York, has committed $170 million over 25 years in exchange for the town hosting the project’s onshore real estate and 18-mile cable route. These funds are part of a larger package of over $700 million in direct project investments into the county, which also includes union labor, local supply chain investments, $10 million to establish a National Offshore Wind Training Center, and $5 million for a research and development partnership with Stony Brook University.
Strengths of Block Island Wind Farm CBA
Deepwater Wind hired a trusted community liaison to facilitate communication between stakeholders. This liaison was a full-time resident on the island and well-respected by the local community. Having the liaison readily available to serve as a resource and provide information bridged the gap between the community and developer and ensured timely engagement. Through the liaison, residents were able to express key community needs and feel as though they were true partners in the process, with one interviewee saying: “My number one takeaway is to make sure you pick a local representative very carefully. Your future can rise or fall based on how that person is viewed in the community and how they represent you in the community. Bryan Wilson was a genius choice on their part. You need someone who understands science but who also loves the island. So he was looking out for the island in all the negotiations.”
Deepwater Wind agreed to fund third-party consultants to provide technical assistance to the town. The consultants were selected by the town to help negotiate a project agreement, educate the town on the technical aspects of the project and translate the community’s concerns into public comments during the permitting process. Over a two-year analysis of the environmental impacts of the wind farm, the consultants found that offshore wind did not have a harmful effect on birds, marine mammals and other flora and fauna due to its small footprint and the mitigation measures taken. This reassured the town about the project’s impacts.
Deepwater Wind’s consultation efforts were buoyed by Rhode Island’s pre-existing SAMP process. The state and Deepwater Wind hosted three years of community meetings to create a comprehensive plan for offshore wind in Rhode Island. Deepwater Wind met with local associations, agencies, elected officials, citizens and non-governmental organizations (NGOs) to inform them about the project and identify any early issues or concerns with the project. As a result of the SAMP process, offshore wind was a familiar topic for local leaders before Deepwater Wind proposed its project. The SAMP process identified the best areas for offshore wind development, preemptively avoiding conflicts with existing uses such as fishing, shipping or recreation. The early engagement with stakeholders helped build trust and reduce delays down the road for the Block Island Wind Farm.
Deepwater Wind provided a transmission line and other benefits that were tailored to the local community, which facilitated the ultimate success of the project. For the community, the most important benefits were the transmission and fiber optic cables connecting Block Island to the mainland and providing the island with high-speed internet. Improved access to secure, reliable and affordable energy is a crucial backbone for economic development, encouraging business growth and tourism.
Challenges and Gaps of Block Island Wind Farm CBA
Until hiring a liaison, the community felt that Deepwater Wind fell short in their engagement. The company hosted a few community meetings in which interviewed residents reported feeling they had little say in how the project progressed. The majority of negotiations took place between the Town Council and the developer, with one community member reporting that the company seemed to incorporate limited feedback from the community: “If the feedback wasn’t what they wanted to hear, it didn’t really go anywhere. Then they eventually hired a spokesperson once they realized we were not going to roll over.”
As a first-of-its-kind offshore wind project in the U.S., the Block Island Wind Farm had little precedent, with the community feeling ill-prepared to respond and actively participate in the development process. There were few other communities New Shoreham could reach out to for guidance on how to engage with the project. One interviewed resident recommended that future developers prioritize sharing more accessible information with laypersons not in the industry about the potential risks and benefits of offshore wind. Due to the complicated technology involved, residents felt underqualified to participate in the public engagement process, leaving it largely up to the Town Council to negotiate with the developer.
While not the case in Block Island, a change in project ownership can threaten existing CBAs. Fortunately, the sale of the Block Island Wind Farm to Ørsted did not significantly impact the implementation of agreed-upon community benefits. However, in other sectors there have been instances in which a verbal agreement between the developer and community has not been honored by a new owner, or where the CBA failed to include a successor clause, making it difficult to enforce after the project was sold. To avoid a sale affecting an agreement, the CBA can be tied to a project itself, rather than to a developer and include a strong successor clause.
Had the project location been different, Block Island likely would have faced stronger community opposition. Scholars credit Block Island’s success and relatively smooth approval process to Deepwater Wind’s decision to site the project near an island disconnected from the mainland power grid. Although the project faced some opposition from islanders, the pushback didn’t reach the same pitch as similar proposals nearby, such as a project off the coast of the more-populated Martha’s Vineyard. Were a different location chosen, additional concessions might have been expected from the developer. Instead, due to Block Island’s isolation, most residents were satisfied with Deepwater Wind’s commitment to fund transmission infrastructure to connect the island to the mainland and co-locate broadband internet access.