Lawmaker wants wind farms in Louisiana waters, but bill could make them too costly

Courtesy Gulf Island Fabrication

A proposed law could both open Louisiana waters to offshore wind energy development and close it by making wind farms too costly, reports

House Bill 165 would set up a legal framework to allow offshore wind leasing in state waters, which extend about three miles from the coast. But the bill also proposes that the state get a cut of the revenues generated by wind farms.

That’s common in oil and gas leasing, but it’s “unheard of in the wind industry,” say Katharine Kollins, president of the Southeastern Wind Coalition. “The bill says (developers) not only pay to lease, but the state also wants part of the financial gain from the project. That’s not been a scenario that wind developers have come across before.”

Because offshore wind is still in the development phase in the U.S., companies are not currently paying royalties on production or other fees in federal waters, where all large-scale wind projects are proposed or under construction.

Wind farm development, construction and maintenance costs are high and profits are relatively low. Unlike oil, which can be stored and shipped to markets across the world, electricity from offshore wind has to be used immediately, typically by nearby power utilities. Read the entire story.