Agreement paves the way for local utility MBCP to be supplied with power from the Morro Bay offshore wind farm

Floating wind power developer Castle Wind has signed a memorandum of understanding (MoU) with a Californian utility to enter into a power purchase agreement for output from a 1GW offshore wind farm in the US Pacific Ocean.

The MoU between Castle Wind and Monterey Bay Community Power (MBCP) is intended as an “expression of MBCP’s good faith intent to draft, negotiate, and enter into a long-term PPA with Castle Wind for output from the Morro Bay floating offshore wind project,” stated the local utility.

EnBW North America and Trident Winds joint venture Castle Wind is in the early stages of developing the 1000MW project, located about 30 miles off the coast from the city of Morro Bay.

The floating offshore wind farm is not expected to become operational until 2026 or 2027.

As MBCP expands its electric service to the residents and businesses in San Luis Obispo and Morro Bay in early 2020 and potentially the rest of San Luis Obispo County in 2021, the project will have strategic potential and importance for locally generated renewable energy and future job creation, according to the utility.

Castle Wind chief executive Alla Weinstein said: “While the project is still several years away, we know that offshore wind is poised to play an integral role in California’s electricity portfolio, which will help the state meet its aggressive climate goals at the least cost.

"This MOU is a statement of commitment by MBCP to use 100% renewables and their desire to secure a supply of clean energy that closely meets their demand profile.”

In October 2018, MBCP began discussions with Castle Wind on how to support the development of the project, and followed up with a letter of support to the Bureau of Ocean Energy Management (BOEM) regarding Castle Wind’s effort to secure a lease to build the project.

In January 2019, Castle Wind submitted a lease application to BOEM and is waiting for a response.

In October 2015, the city council of Morro Bay approved an MoU with Trident Wind.

Last year the Morro Bay Commercial Fisherman’s Organisation and the Port San Luis Commercial Fishermen Association, entered into a mutual benefits agreement with Castle Wind intended to reduce the impacts a future offshore wind project will have on the local commercial fishing industry.

According to a new study from consultancy E3, which conducts energy modelling for the state of California, has found that offshore wind off the coast of California could save California ratepayers up to $2bn on a net present value basis by 2040 through the installation of 7-9GW of offshore wind.

The 7-9GW could meet around 10% the state’s electricity needs.

Modelling results across all scenarios in the study found that including offshore wind in the state’s energy mix would produce ratepayer savings of approximately $1-2bn on a net present value basis.

The study also evaluates offshore wind relative to other resource options including out-of-state onshore wind, such as from Wyoming or New Mexico, and found that offshore wind remains a “valuable and the least-cost resource option even if out-of-state wind is developed in the future.”