NEW YORK CITY

Tip Tricks Dampen Delivery Worker Celebration of New $18-an-Hour Wage

Posted on December 7, 2023 by Yves Smith

Yves here. DoorDash, UberEast, and GrubHub have acted in a deplorable yet predictable manner by changing its app so as to deny deliveristas the benefit of a New-York-City mandated wage increase.

DoorDash and UberEats have taken the most extreme retaliatory move via changes to tipping on its app. Readers have heard a plenty about how Uber squeezes its drivers. DoorDash is a particularly vile company and you should NOT use them, not only for the benefit of workers and restaurants, but also to protect yourself from being scammed. From Eater Chicago, Chicago Sues Grubhub and DoorDash for Allegedly Scamming Basically Everyone: Restaurants, Drivers, and Customers:

The city of Chicago has filed separate lawsuits against Grubhub and DoorDash alleging the third-party delivery companies “engaged in deceptive practices to prey on its affiliated restaurants.” The lawsuits, filed today, August 27, in Cook County circuit court, contain a multitude of allegations, including that the companies use bait-and-switch tactics to fool customers into thinking they’ll be paying lower fees compared to what they’re ultimately charged.

The DoorDash lawsuit also alleges that the company “used consumer tips to pay itself rather than its drivers.” There’s also the question of the Chicago Fee, the charge DoorDash added to compensate for the city’s pandemic-era fee cap. The city says DoorDash tried to make it seem like the Chicago Fee was being administered by the city, and even included a customer’s tweet from January in the lawsuit: “one thing about Chicago, they gon tax your ass LMAO.”

A DoorDash spokesperson says drivers get 100 percent of tips but had no comment on the Chicago Fee. Tipping was also the subject of a $2.5 million settlement after the Washington, D.C. attorney general investigated DoorDash in November 2020. At one point, DoorDash was using tips to subsidized wages for drivers, meaning employees wouldn’t earn more than their locked-in wages. DoorDash has since ended this practice.

Attorneys for the city listed many issues relevant to restaurant owners in the lawsuits, including adding restaurants to the platform without the owner’s knowledge or consent, using telephone routing numbers to charge commission on phone calls that didn’t result in orders, and even creating fake restaurant websites to redirect customers to the delivery platform.

Now to the latest DoorDash grifting.

By Claudia Irizarry Aponte. Published at THE CITY on December 6, 2023

Delivery workers make the rounds in lower Manhattan, Dec. 5, 2023. Credit: Ben Fractenberg/THE CITY

Food delivery workers in New York City are now earning a mandated minimum $17.96 an hour before tips, following months of unsuccessful legal challenges by delivery platforms DoorDash, Uber and Grubhub.

But a sudden coinciding move by the affected apps to change how customers can tip is taking money back out of their pockets, the workers say — and the city’s labor enforcement agency says it’s reviewing the situation.

The new wage, which went into effect on Monday and will increase $19.96 an hour by 2025, accounts for workers’ costs of operating, including vehicle and insurance costs.

Because the apps classify delivery workers as independent contractors and not employees, they are not currently entitled to a standard minimum wage. The city’s tens of thousands of delivery workers previously earned an estimated $11 hourly on average.

For the workers organizing under the banner of Los Deliveristas Unidos, a group of mostly Indigenous Latino and immigrant delivery workers, the change marked a hard-fought achievement in the works since the depths of the pandemic.

“It brings me immense pride and joy,” Sergio Ajche, a delivery worker who founded the WhatsApp group in 2020 that became Los Deliveristas Unidos, said on Wednesday. “Three years ago I could only hope for this moment. This is a tremendous change, and it shows that anything is possible.”

At a celebration held at the NYC Central Labor Council’s midtown Manhattan headquarters, delivery workers, flanked by mayor Eric Adams, touted the historic victory, which makes New York is the first major U.S. city to establish pay minimums in the gig delivery economy.

“This is a historical moment — don’t downplay it,” Adams told the Deliveristas, adding that this was more than a victory in the courts. “You won the case, the fight to say across this entire country: People deserve to be paid the wages they deserve.”

But this week at least two major companies have responded to the new New York City standards by overhauling how their apps process tips.

Doordash now only provides a tipping option after a customer’s order and payment are completed and a delivery person has been assigned. And Uber Eats now only offers a tipping option after the food has been delivered to a customer.

Customers were previously allowed to tip as soon as they placed their orders for delivery — an amount that, by law, must be shown to workers before they accept an order.

Workers say their tips have already plummeted to near nil. The city agency in charge of enforcing the law, the Department of Consumer and Worker Protection (DCWP), is looking into the apps’ new tipping practice, said commissioner Vilda Vera Mayuga.

“We certainly don’t endorse that — people should pay as they wish,” said Mayuga in response to questions from THE CITY.

‘Productivity Gains’

The pay scale is mandated by a 2021 local law, part of a package aimed at boosting delivery workers. Among other measures, it requires restaurants to provide restroom access on demand.

The legislation was inspired by the Deliveristas’ organizing and reporting by THE CITY, which in 2020 first exposed the challenges delivery workers face on the job, from low pay to harassment, assault, injury and death.

When the law went into effect Monday, DoorDash and Uber notified customers and workers via the app that they were overhauling their tipping practices — a move several workers and advocates who spoke with THE CITY charged was retaliatory.

“It’s bittersweet — this is a huge victory for us, but to see the companies take this position, it’s disappointing. Workers are complaining that they’re hustling but not getting tips,” said Toño Solís, a delivery worker and organizer, who said the companies’ move felt like “a form of revenge.”

Added Solís: “The companies have played with us long enough — this proves why we cannot let our guard down.”

DoorDash now tells its customers at checkout that the changes were happening “in response to” the new law in New York City, while Uber says its change is “as a result of” the law.

Asked by THE CITY to clarify their claim, both companies referred to a section in a 2022 DCWP study of the industry designed to set the wage scale, which includes changes to tipping as one scenario companies might pursue to offset any additional costs of higher wages.

“Policies have consequences, and these changes come as a direct result of the extreme earnings standard imposed in New York City,” said DoorDash spokesperson Eli Scheinholtz, who added the move helps the company “balance the impact” of the law on workers, customers and merchants.

Uber spokesperson Josh Gold said the company moved to overhaul its tipping practices to incentivize workers to work harder: “The city’s emphasis on productivity gains to achieve the minimum wage will force couriers to do more deliveries — this is one way to start to do that.”

Grubhub is the only one of the three major platforms that has not overhauled its tipping model, but it reduced the range for suggested tips upon checkout to 0-10% from the 10-25% it had presented to customers as recently as Monday, a change the company made only in New York City.

A spokesperson for the DCWP condemned the changed tipping procedures.

“This is entirely Uber and DoorDash’s own business decision,” the spokesperson, Michael Lanza, told THE CITY. “DCWP supports customers having the option to tip whatever amount they would like, and we do not endorse this nor have we suggested the apps change their tipping policy.”

Ajche said that some customers have begun to share their frustrations about not being able to tip upon checkout on the apps. Some have resorted to tipping in cash or via Venmo and other forms of payment, he said. “To the companies, I would say — this is making you look bad, these games you’re playing.”

 

Russia’s Ideology Is Now National Liberation of the World From the US Empire, With an Assist From Patriarch Kirill

Posted on December 6, 2023 by Yves Smith

Yves here. John Helmer does the important service of summarizing and discussing the implications of the increasingly overtly ideological themes in Putin’s speeches, and his criticism of US policies of hegemony, conflict-fomenting, and touting its self-serving “rules-based order” as contrasted with  multipolarity. Note the latter can and per Putin does imply stronger nation states and cultural identities. Putin has also taken to touting Russia’s multi-ethnicity and (without using these words) arguing that it is subsumed under a national identity  without the loss of cultural identity, while “wokeness” sharpens divisions….which  is a feature, not a bug.

Helmer also sets forth some internal contradictions in Putin’s views, as well as his consistency of application, particularly with respect to terrorism and the conflict in Gaza.

By John Helmer, the longest continuously serving foreign correspondent in Russia, and the only western journalist to direct his own bureau independent of single national or commercial ties. Helmer has also been a professor of political science, and an advisor to government heads in Greece, the United States, and Asia. He is the first and only member of a US presidential administration (Jimmy Carter) to establish himself in Russia. Originally published at Dances with Bears

Between 1917 and right now in Russian history, it has been clear that the horse pulls the cart. That’s to say, the ideas people have, or the ideology of groups and the propaganda of media, churches, and governments are pulled along by their economic interests, by the class structure of the underlying society.

Not the horse in the picture. That’s the icon image, popularised in the Georgian Orthodox Church from the 11th century, depicting St. George, patron saint of believers, spearing to death the Roman emperor Diocletian. Actually, Diocletian ruled the Roman empire from 284 until 305 AD, when he became the first emperor to resign voluntarily and retire harmlessly. Before that Diocletian, a professional soldier, did a lot of spearing of Gauls, Balkan tribesmen, and Persians, as well as Christians in Syria, before he decided to rusticate in his garden on the Adriatic.

The icon doesn’t represent what really happened. Long after Diocletian was forgotten, the icon has come to represent the victory of Orthodoxy over the anti-Christian empire. The icon image was mentioned last week by Andrei Ilnitsky, an advisor to the Russian Defense Ministry and lead ideologist for the United Russia party, in a speech to the Patriarch and President Vladimir Putin. According to Ilnitsky, St George represents Russia,  and the spearing of Diocletian represents what Russia is doing to the US empire on the Ukrainian battlefield.

Now — most precisely at the World Russian People’s Council meeting in Moscow on November 28 — Ilnitsky, the Patriarch, and Putin are reversing the order of history. It’s now the cart of Russian ideology pulling the horse of Russian forces into battle with the Americans.

“They are fighting with us,” declared Ilnitsky,    “for the way people think, for the way they perceive the world. Right now we are fighting a civilisational war for the future. It is this war that we are waging on the battlefields of our own. We will win and revive ourselves by being reborn, or our identity will be wiped out. This is exactly what happened in the Ukraine for thirty years before the start of the SVO [Special Military Operation].”

Putin went further than spearing the emperor. “Our fight”, he declared, “for sovereignty and justice is, without exaggeration, one of national liberation, because we are upholding the security and well-being of our people, and our supreme historical right to be Russia – a strong independent power, a civilization state. It is our country, it is the Russian world that has blocked the way of those who aspired to world domination and exceptionalism, as it has happened many times in history. We are now fighting not just for Russia’s freedom but for the freedom of the whole world.”

This is the first time Putin has identified the doctrine of national liberation in ideological, economic, and in battlefield war against the US doctrine of hegemony and exceptionalism.

“We can frankly say that the dictatorship of one hegemon is becoming decrepit. We see it, and everyone sees it now. It is getting out of control and is simply dangerous for others. This is now clear to the global majority. But again, it is our country that is now at the forefront of building a fairer world order. And I would like to stress this: without a sovereign and strong Russia, no lasting and stable international system is possible.”

During the World Russian People’s Council, Ilnitsky said the threats of the US empire are emanating from three directions of US strikes on the country and the people. “I will not talk about purely military aspects, but about how we do not lose the world. This is what is called ideology. A month ago, the US national security strategy was adopted. The Americans position themselves as the global hegemon. The so-called autocracies have been declared enemy number one; in fact, they are the nation states which are pursuing a sovereign policy. Russia is mentioned in this document 69 times! Even more often than China. And Ukraine is cited only as anti-Russia.  Russia is the civilisational opponent of the West. Without the elimination of Russia, the development of the Western world is impossible. It will not be possible to normalise relations because of the deepest difference in goals and values.”

“At the same time,” Ilnitsky went on, “violence has become the defining concept of Western politics. War is a component of such a world of violence. How are they going to implement this violence? Everything is said in the US national defence strategy. They confront us on land, in the air, at sea, in space. And also in the information sphere. But now they are striving for informational and cognitive dominance. The US Joint Chiefs of Staff identified three areas of their attack: technological warfare (including artificial intelligence); the war in the city; the transition from informational to cognitive-mental dominance. Psychological operations will be enhanced as much as possible. This is no joke. This is the same mental war where the destruction of the enemies’ self-consciousness is the goal,” Ilnitsky emphasised.

Andrei Ilnitsky speaking to the World Russian People's Council in Moscow on November 27. Source: https://www.youtube.com/watch?v=rTbHrAS0EyY

Starbucks gives free coffee to NHS workers across the UK

 STARBUCKS APPRECIATES NHS WORKERS MORE THAN THE TORIES

6th Dec 2023 - 05:00

Today (Wednesday 6th December) Starbucks is giving away a free tall beverage to all NHS workers as a festive thank you for their hard work.

This is the fourth year that Starbucks has been providing this festive treat as part of the company’s support for NHS Charities Together. Select hospitals without a nearby Starbucks store will receive deliveries of Starbucks Frappuccino Mocha Flavoured Chilled Coffee and Starbucks Toffee Nut Latte Premium Instant Coffee.   

NHS staff can order any tall beverage of their choice from Starbucks stores across the United Kingdom (England, Scotland, Wales, and Northern Ireland) when they show their work identity card in store.

Alex Rayner, general manager at Starbucks UK, said: “We want to thank NHS staff across the UK for all the work they do and as a token of our appreciation, we are bringing back the free tall beverage on 6th December for the fourth year running. Coffee brings people together and we hope that NHS staff can take a moment today to share the festive joy and raise a coffee to one another to celebrate.

"We know how much NHS staff have enjoyed taking part in this special day and it’s something we look forward to year after year, so we are thrilled to see our partnership with NHS Charities Together flourish and our offer extend to more NHS workers than ever before. We look forward to building on this success so we can continue to give back to the communities we serve.”

 

UK Plans First Commercial-Scale Deployment of Floating Wind in Celtic Sea

UK looks to launch the first commercial-scale floating wind farms in the Celtic Sea (Crown Estate)

PUBLISHED DEC 7, 2023 9:38 PM BY THE MARITIME EXECUTIVE

 

 

The UK is set to start the next phase of its development of offshore wind energy power generation looking to launch the first commercial-scale development of a floating offshore wind farm. Known as Round 5, The Crown Estate will start the leasing process in early 2024.

The industry stands at a crossroads in the UK. After having been an early developer and today having almost half as much operational capacity as the rest of Europe combined, they look to open up floating wind as the next phase of the industry’s development. The Crown Estate which manages which manages the seabed around England, Wales, and Northern Ireland, released further details today, December 7, for the leasing round for three commercial-scale floating wind projects in the Celtic Sea off the coast of South Wales and South West England. 

They highlight that floating wind technology has the potential to open new areas of the seabed for wind power generation. The anchoring technology they highlight will permit wind farms to move to areas of greater depth, further from shore, where wind patterns are stronger and more reliable versus the existing fixed-base turbines. 

"Floating offshore wind is a huge opportunity for Wales and the South West, with the potential to deliver billions of pounds of direct investment whilst bolstering our energy independence and net zero ambitions,” said Graham Stuart, the UK’s Minister of State for Energy Security and Net Zero. “Today's plans will build on the Government’s ambition to deploy up to 5GW of floating offshore wind by 2030.”

The first three wind farms planned for the Celtic Sea will have a combined capacity of up to 4.5 GW and are expected to be the first phase of commercial development in the region. The UK government declared its intention in 2023 to unlock space for up to a further 12GW of capacity in the Celtic Sea. By the 2030s, they predict the Celtic Sea could be providing 16 GW of renewable energy.

The Crown Estate notes that its goal is to support the development of the industry while creating the best value for the nation. They reported that the Round 5 program will adopt further changes to support the industry by enabling upfront investment in important workstreams to de-risk the process for developers. This will include investments in marine surveys to better understand the physical and environmental properties around the locations of the new wind farms. The Crown Estate has also outlined its intention to bring forward a new pilot fund to help accelerate supply chain projects.

The process for Round 5 will begin in early 2024 with pre-qualification questionnaires and an informational session on January 31 for prospective bidders to learn more details of the Round 5 tender. 

South Fork Wind Becomes First Large U.S. Wind Farm to Deliver Power

South Fork's first two turbines were installed in November and today marked the delivery of first power (Orsted)

PUBLISHED DEC 6, 2023 2:07 PM BY THE MARITIME EXECUTIVE

 

 

New York’s South Fork Wind marked the delivery of its first power achieving a milestone for the beleaguered industry that is facing well-publicized financial and operational challenges. While smaller in scale at just 12 turbines to generate approximately 130 megawatts, it is still considered to be the first commercial-scale wind farm in the United States.

The project, which is a joint venture between Ørsted and Eversource, is located approximately 35 miles offshore from Montauk, New York on the eastern tip of Long Island. It has completed the installation of its first two turbines, with one operational, and expects to complete the installation of the 12 turbines by early 2024. When fully operational, they expect the wind farm will power about 70,000 homes.

Officials noted that it was nearly eight years in the making to reach this point. The project was first approved by the Long Island Power Authority in 2017 two years after they issued the first request for proposal. The federal site review was completed in 2017 and the project spent between 2018 and 2020 working on its construction and operating plan before gaining final federal approval in January 2022.

With offshore work beginning in 2023, the wind farm marked several key milestones. Boskalis's Bokalift 2, handled the foundation installation with the first steel entering the water in June. The wind farm also has the first U.S.-built offshore wind substation. Weighing 1,500 tons and standing 60 feet, it was built in Texas by Kiewit Offshore Services and after being completed in May was shipped to the site for installation. 

“South Fork Wind is not just a trailblazing project for the state, it’s also one of the foundations of America’s offshore wind energy industry,” said David Hardy, EVP and CEO Americas of the Ørsted Group. 

 

 

The U.S.’s first offshore wind farm was constructed in 2015 to provide power for Block Island, Rhode Island. The five turbines have been providing power in place of diesel generators since 2016 from the wind farm which is also operated by Ørsted. Five years later, Dominion Energy completed the installation of two 12-megawatt turbines in 2020 as a pilot project 27 miles off Virginia Beach.

Last month, the federal Bureau of Ocean Energy Management highlighted that it had approved the sixth large offshore wind farm project in the United States with Empire Wind. Proposed as a joint development between Equinor and BP, the wind farm would be located about 12 nautical miles south of Long Island, N.Y., and about 17 nm east of Long Branch, N.J. Together these projects would have up to 147 wind turbines with a total capacity of 2,076 megawatts of renewable energy.

These projects however are currently in jeopardy. New York regulators rejected a proposal from Equinor and BP, along with another proposal from Ørsted to reprice the power agreements for Empire Wind along with Beacon Wind and Ørsted’s Sunrise Wind.  The developers argued that the financial pressures required an increase in the electric offtake price to make the projects economical and have threatened to walk away from them which would be a major setback to New York’s plans. The state recently issued its next wind solicitation providing a path for these projects to be rebid in early 2024. 

First power from South Fork is also good news for Ørsted which has been one of the most impacted companies by the changing fortunes of the offshore wind sector. The company has walked away from large projects in New Jersey and announced it would be taking a financial write-down of approximately $5 billion due to the financial, supply chain, and development problems in its U.S. wind portfolio.

Despite the setbacks, BOEM contends that it remains on track to complete reviews of at least 16 offshore wind energy project plans by 2025, representing more than 27 gigawatts of clean energy. The Biden administration has called for 30 MW of offshore energy production for the U.S. by 2030.

UAE Makes Second Major UK Wind Farm Deal Expanding Renewable Energy Role

Iberdrola will co-invest with the UAE's Masdar in UK and other other wind and renewable energy projects (Iberdrola)

PUBLISHED DEC 5, 2023 8:21 PM BY THE MARITIME EXECUTIVE

 

 

The UAE announced plans for its second large investment in the UK offshore energy sector forming a partnership with Iberdrola which is set to develop one of the largest wind farms in the UK sector. This initiative which is part of a broader cooperation between the UAE’s Masdar and Spain’s Iberdrola follows a similar agreement announced days ago for the UAE to invest with RWE in another of the UK’s largest wind farms and is part of a broader strategy by the UAE to enhance its image by investing in renewable energy projects ranging from Germany to Poland, the USA, Indonesia, Kazakhstan, and elsewhere.

HE Dr Sultan Al Jaber, the UAE Minister of Industry and Advanced Technology and Chairman of Masdar, is also serving as the President of the COP28 conference taking place currently in Dubai. They are seeking to use the conference to highlight the UAE’s emerging role as a global investor and developer in renewable energy projects.

Under the agreement signed today on the sidelines of the COP28 conference, Masdar will acquire up to a 49 percent stake in the East Anglia Three wind farm that Iberdrola is developing. Masdar highlights that it will become a co-developer sharing the risks of the project which is now under construction and expected to be fully commissioned in the fourth quarter of 2026 providing up to 1.4 GW of energy. Through a subsidiary, Iberdrola already has the first phase of the project at the site which is part of the East Anglia Hub macro-complex, which is expected to provide a total of 3.3 GW.

Iberdrola secured a 15-year agreement firm the UK government for the site's third phase project in July 2022. The contract provides for a price of £37.35 per megawatt hour which is half the new UK maximum price in the next round auction of £73 per megawatt hour and illustrates the challenges facing the offshore wind industry. Analysts believe the UAE is taking advantage of the current troubles in the industry to expand its role taking risks but also demonstrating confidence in offshore wind energy.

The final terms of the agreement for the investment in East Anglia Three will be reached by the first quarter of 2024 and part of a larger transaction that will see the two companies work together to jointly invest in future offshore wind and green energy projects in Europe and elsewhere. Masdar last year acquired a stake in Iberdrola’s Baltic Eagle wind farm being built in Germany. They noted that exploration is already underway for additional projects. The two companies anticipate the total value of the investments could reach €15 billion.

Masdar highlights that it has been active in the UK and Europe for more than a decade investing in projects including the London Array and Hywind, which is Scotland’s first floating wind farm. The company, which is jointly owned by Abu Dhabi National Oil Company (ADNOC), Mubadala Investment Company, and Abu Dhabi National Energy Company (TAQA), reports it is targeting a renewable energy portfolio capacity of at least 100 GW by 2030 and an annual green hydrogen production capacity of up to 1 million tonnes.

Iberdrola’s Executive Chairman, Ignacio Galán notes the growing opportunities in offshore wind and renewable energy. He highlighted that this week at COP 28 a total of 118 governments pledged to triple renewable energy capacity by 2030.

Changeable Seas for Offshore Wind in the Northeastern U.S.

Courtesy South Fork Wind

PUBLISHED DEC 7, 2023 4:00 PM BY ROBINSON+COLE LLP

 

Offshore wind (OSW) is a key component of the Biden administration's renewable energy goals, which include the deployment of 30GW of offshore electricity by 2030 and 110GW by 2050. For perspective, the administration claims that 30GW would power over 10 million homes.  The Northeast, with its favorable coastal shelf and prevailing wind conditions, has been at the forefront of offshore wind development in the United States.  While federal and state permitting efforts have advanced on several projects and turbines have started to leave coastal ports for their offshore destinations, other planned installations have stalled recently due to changing economic conditions.  Despite the economic obstacles to meeting the administration’s OSW goals, the Northeast and other coastal states continue to back offshore wind.

Recent Developments in Connecticut and Surrounding States

While economic headwinds have rattled project developers, Northeastern states are investing in OSW by employing partnerships and streamlining permitting to support and facilitate the development of coastal wind energy. They are also looking to the federal government for support.  In a September 13, 2023, letter, six coastal states (Connecticut, Rhode Island, Massachusetts, Maryland, New Jersey, and New York) urged President Biden to deploy additional federal resources to support the OSW industry. The American Clean Power Association (ACP) has stated that it intends to work with the Biden administration to address bottlenecking in the federal permitting process. The ACP also indicated its support for the Reinvesting in Shoreline Economies and Ecosystem (RISEE) Act, which would provide hundreds of millions of dollars to states adjacent to OSW leases.

In Connecticut, specifically, the Department of Economic and Community Development (DECD) recently released its Offshore Wind Strategic Roadmap (Roadmap), outlining the State’s plans, initiatives, and steps to further OSW development. To achieve its lofty goal of 100% zero-carbon electricity by 2040, Connecticut outlined four key pillars:

1) Infrastructure/Real Estate. Build off the progress made with projects like the State Pier Terminal in New London and the Ports of New Haven and Bridgeport. These deep-water ports are crucial to expanding marshaling, operations and maintenance, and other supporting capabilities for OSW development.   

2) Supply Chain. Increase regional capabilities and coordination across the OSW supply chain. The State will rely on its demonstrated expertise in composite materials and metal fabrication capabilities developed through its long history of government contract work.

3) Workforce. To achieve zero-carbon electricity, the DECD acknowledges that it must provide a local labor force to prepare for and connect with OSW-related jobs. To do this, Connecticut has partnered with other New England states to determine how to incorporate early education and workforce development initiatives to secure skilled personnel. 

4) Research and Development. To encourage further research and development, Connecticut has partnered with UCONN, Yale, and investment institutions to promote research activities related to OSW.

To implement its Roadmap, Connecticut has established the Connecticut Wind Collaborative (CWC). The CWC will oversee the implementation of the pillars outlined in the Roadmap. The new non-profit organization will be comprised of OSW leaders from academia and across the government, private, and public sectors. Additional information about the CWC’s structure and authority will be released in the future.

Connecticut has also recently partnered with Massachusetts and Rhode Island to cooperate and coordinate on OSW development. An October 3, 2023, Memorandum of Understanding (MOU) between the three states outlines an approach to soliciting multi-state bids for OSW development that will benefit the states collectively. The MOU’s primary objective is to encourage collaboration between the states in hopes of leveraging buying power and making the development of OSW projects more cost-effective. While the MOU does not require any one state to work with the others on new proposals, it does ensure that each state will benefit equally from multi-state bids for any OSW project proposal, and requires each state to consider whether a bid can result in a multi-state project. MA Governor Maura Healey said the MOU will “amplify the many benefits of offshore wind for all three states, including regional economic development opportunities, healthier communities, lower energy bills and advantages to environmental justice populations and low-income taxpayers.” 

The MOU also encourages good-faith coordination between the states when considering both independent and multi-state OSW projects. When considering a multi-state bid, applicants will be required to designate which states are impacted by the proposed project. Approval of a multi-state proposal may be contingent upon approval from all three participating states. The MOU clearly states that it is not meant to be seen as a legal authority binding the states to enter into contracts or other agreements.

The MOU’s objectives of collaboration and reducing costs for bidders are already being implemented. Connecticut’s recent Request for Proposal (RFP), published on October 27, 2023, provides a pathway to solicit multistate bids. In addition, the Connecticut RFP includes a provision that allows bidders to submit pricing at a rate indexed to the price of “listed macroeconomic factors and commodities” that will be fixed at some date in the future. The indexed pricing approach allows bidders to account for changes that may occur after the bid due date, but before the project reaches final close, by adjusting their proposed price up or down by no more than 15%.  This flexibility is intended to ease the financial hardships many OSW developers are currently facing.   

Financial Hardships

While the coastal New England states continue to solicit proposals for OSW development, several developers have run into commercial roadblocks that have substantially reshaped the economic analysis. Global events such as COVID-19 and the war in Ukraine have caused the scarcity of some materials and the skyrocketing costs of others. According to Building a National Network of Offshore Wind Ports, a publication released by The Business Network for Offshore Wind, there is now an estimated $22.5-$27.2 billion discrepancy between available financing and the financing required to construct the OSW facilities needed to achieve the administration’s OSW goals.

Other pressures driving development costs include the surge in demand for OSW globally, rapid increases in turbine sizes over the last decade, expansion of offshore wind into deeper waters requiring more costly technological solutions, historically-high interest rates and commodity input prices, and competition for construction materials in and outside of the OSW industry. Changing market conditions have had at least some impact on almost every OSW project currently under development. 

In a constantly changing landscape, the current status of OSW projects in the Northeast continues to evolve:

Project Name	State	MW	Developer	Project Status	Permitting Status
Vineyard Wind	MA	800	Avangrid	Under Construction	Received BOEM Record Decision
Beacon Wind	MA	1200	Equinor	Permitting stage	EIS review
Revolution Wind	RI	704	Orsted/ Eversource	Under Construction	Received Final Approval for DOI Construction
Park City Wind	CT	800	Avangrid	Stalled	Stalled
South Fork Wind	NY	132	Orsted	Under Construction	Received BOEM Record Decision
Sunrise Wind	NY	924	Orsted	Obtaining permits	EIS review
Empire Wind 1	NY	816	Equinor	Permitting stage	BOEM released final EIS
Empire Wind 2	NY	1200	Equinor	Permitting stage	BOEM released final EIS
Ocean Wind 1	NJ	1100	Orsted	Canceled	Canceled
Ocean Wind 2	NJ	1150	Orsted	Canceled	Canceled
Skipjack Wind	MD	966	Orsted	Conducting Surveys	EIS review
Coastal Virginia Wind	VA	2590	Dominion Energy	Obtaining construction permits	Received BOEM Record Decision

 

Revolution Wind, set for construction south of Block Island, is one project proceeding intact and is estimated to deliver 400 MW of power to Rhode Island and 304 MW of power to Connecticut. Orsted and its then-partner Eversource locked in project costs prior to the current market instability and recently announced a final investment decision confirming that construction is expected to be completed by 2025.  Eversource, however, is withdrawing from the wind sector, announcing in September that it would be selling its fifty percent interest in its three jointly-owned contracted OSW projects with Orsted: Revolution Wind, Sunrise Wind, and South Fork Wind. Currently, workers at the New London State Pier in Connecticut continue to assemble parts for the South Fork Wind turbines. These turbines can be seen off the coast of Montauk Point as the nation’s first commercial-scale OSW farm takes shape. At present, Revolution Wind and Sunrise Wind are also proceeding as planned.

The offshore wind market has changed, however, and other projects have stalled or been canceled.  Orsted recently ceased development of the Ocean Wind I and II projects in New Jersey and will announce final plans to terminate, postpone, or continue other OSW projects in the United States in 2024.  Also, citing unanticipated economic factors, Avangrid has terminated its power-purchase agreement for Park City Wind, which was expected to supply roughly 14% of Connecticut’s electricity.  The project is expected to be rebid.  

Despite these setbacks, state governments continue to explore OSW development and ways to alleviate some of the economic and logistical hurdles standing in the way of progress.