With hours to go until the end of their 2023 legislative session, Maryland lawmakers on Monday passed the Promoting Offshore Wind Energy Resources (POWER) Act (S.B. 781), committing the state to developing 8.5 GW of offshore wind by 2031.

After the House of Delegates passed the bill on April 4, with amendments from its Economic Matters Committee, a conference committee was quickly formed Monday and hammered out final changes, removing some of the amendments. The bill was approved first in the Senate by a vote of 35-12 and then in the House of Delegates, 101-38. (See Maryland Lawmakers Vote to Raise Offshore Wind Target.)

In addition to more than quadrupling the state’s 2-GW pipeline of projects in development, the bill now headed to Gov. Wes Moore’s (D) desk would require the Maryland Public Service Commission to ask PJM to set up a State Agreement Approach planning process for offshore wind transmission, similar to New Jersey’s agreement with the grid operator. However, the bill calls on the PSC to reach out to other PJM states to evaluate regional transmission cooperation that could help it meet its offshore wind goals, according to the legislature’s analysis of the bill.

The PSC or PJM will have to issue one or more competitive solicitations for transmission projects by July 1, 2025. Additional solicitations could be issued after that if needed.

The bill requires PJM or the PSC to study specific transmission solutions, including one that uses an open-access collector system to allow for the interconnection of multiple offshore wind projects at a single substation.

One of the House amendments to the bill states that such studies must also “demonstrate net benefits to ratepayers in the state when compared with an alternative baseline scenario under which 8,500 MW of offshore wind capacity is connected to PJM Interconnection independent of an offshore wind transmission project.”

Such an alternative scenario might connect offshore projects to PJM via individual radial lines as opposed to networked transmission linking multiple projects to onshore substations. Industry experts increasingly favor networked, meshed HVDC systems as the most flexible and efficient for offshore transmission. (See OSW Developers Look to Europe on Meshed HVDC Tx.)

Moore is expected to sign the bill, after voicing his support for its 8.5-GW goal at the recent Business Network for Offshore Wind (BNOW) International Partnering Forum in Baltimore. The new target would produce “enough energy to power nearly 3 million homes” and provide opportunities to rebuild and expand steel manufacturing in the state, he said. (See U.S. Wind Industry Set to Take Off.)

Industry Response

Industry response was immediate and celebratory, heralding both the bill’s clean energy and economic benefits.

“The POWER Act establishes a comprehensive strategy to plan, connect and deploy offshore wind at the scale necessary to support supply chain investments and decarbonize Maryland’s economy at the lowest possible cost to Marylanders,” said Evan Vaughan, deputy director of the Mid-Atlantic Renewable Energy Coalition.

The law will allow the state to reclaim “national leadership in offshore wind [by] establishing a first-in-the-region initiative to proactively plan a 21st century transmission grid,” Vaughan said.

BNOW CEO Liz Burdock agreed that “the POWER Act repositions Maryland back into a leadership position, and with the federal government opening up new lease areas next year, offers the state a rare opportunity to attract major manufacturing and supply chain investment.

”Maryland must capitalize on this opportunity by moving quickly from legislation to execution and commercialization,” she said.

“The POWER Act is a real game changer for Maryland,” said Jeff Grybowski, CEO of Maryland-based offshore wind developer US Wind. “It sets a path for the people of Maryland to reap the benefits of huge amounts of clean energy in the coming years. It also tells the entire offshore wind industry globally that Maryland is back big time as a major player. Companies looking to invest in offshore wind have to seriously consider Maryland.”

Echoing Vaughan, Nick Bibby, Maryland state lead for Advanced Energy United, hailed the bill’s regional approach to transmission planning, saying it “will improve the transmission infrastructure planning process to improve grid efficiency and resiliency, lower utility bills for homes and businesses, and create good-paying jobs that connect Maryland to wind and solar resources.”

Maximize Opportunities

Other amendments to the bill include a call for the state to “maximize the opportunities” for obtaining federal funds for offshore wind and transmission projects by aligning its labor and domestic content standards with those in the Infrastructure Investment and Jobs Act and Inflation Reduction Act.

Provisions in the two laws either require projects to pay prevailing wages and offer registered apprenticeship programs. Tax credits provide bonus incentives for ensuring clean energy projects include made-in-the-U.S. materials and components.

Here are some other key sections of the bill:

• Transmission proposals could include upgrading the existing grid, extending the transmission grid both onshore and offshore, interconnecting between offshore substations, adding energy storage, and using high voltage direct current converter technology to support potential weaknesses in the transmission grid.
• The PSC will have to pick one or more transmission proposals by Dec. 1, 2027, and then work with the developers, PJM, FERC, potentially other states, and other stakeholders to ensure the lines get built. If the solicitation does not lead to any beneficial or cost-effective proposals, the PSC can end it without picking one and would then have to notify the legislature of its decision by Dec. 1, 2027.
• The bill also includes language for the 2 GW of offshore wind developments that have already cleared earlier procurements, allowing developers to ask the PSC for an exemption to the requirement that they pass along to ratepayers 80% of the value of any state or federal grants, rebates, tax credits, loan guarantees or other benefits. Developers must prove that the exemption is needed to meet their contractual obligations.