The backers of the Great Lakes’ first offshore wind farm are working to reboot the project following an Ohio Supreme Court decision this week that resolves more than two years of legal and regulatory uncertainty.
The Icebreaker Wind project was first proposed more than a decade ago by a public-private partnership in northern Ohio. The 20.7-megawatt project will consist of six turbines installed about 8 miles north of Cleveland.
The project has been largely mothballed since May 2020, when state regulators approved a permit for the project with a “poison pill” provision that would have kept it from operating for much of the year. That set off months of legal and regulatory appeals that were finally resolved by a 6-1 decision Wednesday by the Ohio Supreme Court.
“Despite the good news today, it is going to be challenging to get this project rolling forward again,” said Will Friedman, president and CEO of the Port of Cleveland and a board member of LEEDCo, the Lake Erie Energy Development Corporation, which was formed in 2009 to launch the project.
The project has a commitment from the city of Cleveland and Cuyahoga County to purchase one-third of the electricity, but efforts to sell the remaining two-thirds were put on hold amid the legal challenges. Without commitments to buy all of the electricity, it’s unlikely the project will be able to borrow money for upfront construction costs.
Meanwhile, the project’s lead officer, Dave Karpinski, left his role as president last summer for another job. Other key staff members have retired. Friedman said one of the first priorities in the wake of the court ruling will involve staffing. Fred. Olsen Renewables remains contracted as a developer for the project.
As the United States’ first freshwater-based wind farm, Icebreaker is a pilot project. The project caught a break in January when the U.S. Department of Energy extended a deadline for LEEDCo to use previous grant money. Additional funding will be necessary even if the promoters get commitments to sell all the output at market rates.
“It’s R&D, is what it is,” Friedman said.
“We want to get out there and get these turbines in the water and start generating power and show that this is feasible,” Friedman said. “And then when that happens, then we can let the market kind of come in. And hopefully we would see what’s happening on the East Coast where larger utility-scale projects are moving ahead.”
Ohio’s Republican caucus rejected a proposed surcharge for Northeast Ohio ratepayers to subsidize the project last December. The charge of roughly 20 cents per month would have been an amendment to House Bill 389, a bipartisan bill that seeks to restore some energy efficiency programs that were cut after House Bill 6, the law at the heart of Ohio’s ongoing corruption scandal.
“And so here we are in Ohio, doing it with sort of two legs of a three-legged stool,” Friedman said. “We’ve got local people working on this and the federal government partnering in the project. But the state is absent, and that just remains very challenging.”
Other challenges include revisiting engineering plans, to see if any updates are necessary. Costs also will need updating, Friedman said. And revised estimates will feed back into efforts to raise capital.
Even when all of that is in place, the permit contains various requirements and conditions that will need to be satisfied. Consequently, Friedman could not yet give a firm timeline for when the project would be built and operational.
Fossil fuel opposition
LEEDCo’s legal existence as a public-private nonprofit partnership stretches back to its incorporation in 2009 as the Lake Erie Energy Development Corporation. Justice Jennifer Brunner, who penned the Ohio Supreme Court’s majority opinion last week, was Ohio Secretary of State at the time. She’s now running for Chief Justice of the Ohio Supreme Court against Justice Sharon Kennedy, who cast the only dissenting vote against the Icebreaker project.
Despite funding setbacks in 2014, the project’s supporters pushed ahead with planning and environmental studies. Icebreaker’s completed permit application was filed with the Ohio Power Siting Board in 2016. Planners hoped construction would take place in 2018.
In 2017, however, attorney John Stock, who had represented Murray Energy in other matters, appeared in the case on behalf of a pro-coal group and then acted as the lawyer for several individuals who opposed the project. Stock followed a similar pattern in other Ohio wind farm siting cases.
Documents uncovered through pre-hearing fact-finding confirmed that Murray Energy paid the individuals’ costs for fighting the Icebreaker wind project. Payments continued for at least some time after the coal company filed for bankruptcy in late 2019. American Consolidated Natural Resources, Inc., the company’s successor-in-bankruptcy, did not respond last year when asked if it had continued to pay for legal fees in the case.
“The fossil fuel industry continues to hamper renewable energy development in Ohio,” said Trish Demeter, interim executive director for the Ohio Environmental Council, which was a party in the proceedings. “In this case, Murray Energy funded legal opposition to thwart the development of Icebreaker Wind, but they failed in stopping this innovative project from clearing another hurdle.” Nonetheless, she noted, “the ongoing legal challenges most likely led to some slowdowns in securing funding and planning of the project.”
By 2019, all parties except Stock’s clients had nonetheless agreed on a settlement, which included extra environmental protections such as additional pre-construction monitoring. Then, Gov. Mike DeWine made wind-energy foe Sam Randazzo chair of the Power Siting Board and Ohio Public Utilities Commission. FirstEnergy admitted last year that it paid $4.3 million to a Randazzo-linked company shortly before that appointment, although Randazzo has denied wrongdoing.
Two months before the first arrests in the HB 6 scandal, Randazzo and the rest of the Power Siting Board approved a permit for the Icebreaker project, but with a “poison pill” provision that would have shut the project down for two-thirds of the year. A bipartisan group of 32 lawmakers objected, and LEEDCo and others asked for reconsideration.
The board finally removed the condition and approved the permit in October 2020, roughly one month before Randazzo resigned from the board following a search of his home by federal agents. Then the individual defendants appealed to the Ohio Supreme Court. Briefs were filed in July 2021, but the judges didn’t hear oral argument until December. Then it took another eight months before the decision came out.
Moving ahead
Even with all the drawbacks, Friedman remains optimistic. “It’s undeniable that there’s an imperative to develop non-fossil-based energy as quickly as we can,” he said. At least one estimate suggests the U.S. offshore wind supply chain could grow into a $70 billion industry, and he would like Northeast Ohio to have its share of that growth.
“It’s the right environmental policy, and it’s the right economic policy, for sure,” Friedman said. As he sees it, the work could provide thousands of jobs, many of which would benefit the Port of Cleveland and surrounding areas. “We just see that as right in our wheelhouse,” he said.
“It’s our hope that LEEDCo can now resume selling the remainder of the power and turn this dream into a reality,” said Ronn Richard, LEEDCo board chair and chief executive officer for the Cleveland Foundation, when the Ohio Supreme Court’s ruling came out.
Meanwhile, Demeter and her colleagues urge the Ohio Power Siting Board to adopt rules from the Ohio Judicial Code of Conduct to attorney examiners and board members. “The Icebreaker case is a strong reminder of the inappropriate influence the fossil fuel industry can have on Ohioans’ access to clean innovative energy,” she said.
The OPSB is accepting comments from the public for its current rule review until Sept. 2. Emails can be sent to contactOPSB@puco.ohio.gov with “Reply Comment for 21-0912” in the subject line.