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TOM WHEELER:

Welcome to the Econews Report. I'm your host this week, Tom Wheeler, Executive Director of EPIC, the Environmental Protection Information Center. And we're talking about offshore wind on this week's show. I think we're going to be talking about offshore wind a bunch in the next decade or so. And in particular, we're talking about community benefit agreements associated with offshore wind energy development. And I don't really know that much about this. This is a whole new world to me. But I have a panel of really fantastic folks who are going to make sense of this world. So first off, let me introduce Eddie Ahn of Brightline Defense. Welcome to the show, Eddie.

EDDIE AHN:

All right, thanks for having me.

WHEELER:

Erik Peckar of Vineyard Power. Hey Erik, how are you?

ERIK PECKAR:

Great. Thanks so much for having us, Tom.

WHEELER:

Katerina Oskarsson of the Core Hub at the Humboldt Area Foundation. Hey Katerina!

KATERINA OSKARSSON:

Hello, really happy to be here.

WHEELER:

I'm happy to have all of you on this show. We have folks from the West Coast to the East Coast on the show. This is a big panel of folks who know about community benefit agreements, who have negotiated community benefit agreements before. I think that this is going to be a big topic of offshore wind energy development here in Humboldt County. First, I'm going to throw it to Eddie to just give a 30,000-foot view of what a community benefit agreement is. And then, Eddie, if you could follow up with that on how has Brightline Defense, your organization, worked on community benefit agreements in the past.

AHN:

Yeah, so Brightline, for those who might not know, we're an environmental justice nonprofit, and we do a lot of policy work, especially as it relates to offshore wind. And when we talk about community benefits, it's important to think about the context of these projects and how much money is involved and infrastructure is involved in building them out. So we're talking about turbines that are potentially as large at the base of a loan could fit inside a football stadium, for instance. And there are literally hundreds that are being proposed off both the North Coast and Central Coast of California, that can potentially provide up to 20-25% of the state's power by 2045 is a larger energy planning goal. But the fundamental question remains, how do local communities benefit as these projects go up? And that's why community benefits are really important part of this discussion.

And they can be a number of different things, ranging from, for instance, funds, whether it's building capacity to even engage in these discussions, to just even sharing the economic benefits from the profits generated from these large offshore wind farms. They can also include things like progressive workforce development policy, things like guaranteeing jobs for local communities through local hiring targets or targeted hiring targets. And also, of course, additional funds for building up job training systems as well to make sure the developers and construction contractors that are building out these projects can then have the local workforces that they want on these projects, the local sustainable economies that everybody would desire on something like this.

And then the other interesting aspects of this could be things like infrastructure, it could be ranging from roads to Wi-Fi, generally broadband access, or another set of ideas have been about environmental cleanup and potential decommissioning, for instance, of older infrastructure that may already exist. And then in the future as well, as these offshore wind turbines are eventually retired and perhaps even replaced, what is even the process for that? So those are all things that can be encapsulated in an agreement that then guarantees community benefits.

WHEELER:

All right, Eddie, I can tell that you're an attorney. That was a very succinct lawyer-like answer. I appreciate it. All right, Erik, you are out in Martha's Vineyard. For us here on the West Coast, offshore wind energy development is this idea in the future. It's something that is a promise that is yet unfulfilled. But for you, you have offshore wind. You are the kind of leading case for offshore wind in the United States. A different technology, yours is not floating offshore wind like ours will be, but you've been through the wringer before. Tell us about vineyard power and how you got to be interested in offshore wind in Martha's Vineyard.

PECKAR:

Yeah, so thanks so much, Thomas, and I really appreciate Eddie's answer as well. So our journey began around 2009 when our organization started. I've been with the company since 2010. We are a non-profit on the island of Martha's Vineyard. We represent our community. And on Martha's Vineyard, we have six towns on the island. There was a project that initially began in the early 2000s called Cape Wind, which some folks might be familiar with out here, but it was a very famous project up in New England and very divisive. And there was a lot of lessons learned coming out of that project because it was kind of well known that that project, there wasn't a lot of benefits coming back to the local communities on Cape Cod and Nantucket and Martha's Vineyard, which are 3D. Some people might call them very affluent communities. I, living here year round, probably more working class, blue collar communities for the year round folks.

On Martha's Vineyard, we tried to kind of glean some of the lessons learned, knowing that there was going to be offshore wind farm development south of the island over the next 10 plus years. And so we began a process early on and we as a community, at first we were thinking about why don't we, knowing that offshore wind's coming, why don't we try to build our own community-based offshore wind farm? And that is very much easier said than done. And over during kind of the planning and analysis phase, which happened between 2010 and 2016, we really started to examine the possibilities of partnering with an offshore wind farm developer. And what would that look like? How do we attract a developer? What makes us attractive? What do we want as a community?

So we really tried to identify particular items that would be important for us, bring the benefits from this development back to our island. And we looked at workforce development, having an operations and maintenance facility on our island. So that's kind of where the long-term jobs are. These constructions completed. And then also at the time too, Martha's Vineyard was going through a process where we were looking at setting renewable energy targets. So all six towns on the island voted to be 100% renewable in heating, transportation, electricity by 2040 and fossil fuel free by 2040 as well. So that was kind of the backbone of where we really wanted to take our quote unquote kind of asks for potential development or in a potential partnership with the developer.

So we formally partnered with Vineyard Wind in a community benefit agreement in 2016. And it was prior to the lease auction, which is a little bit different than how California has it set up. But what was important and the big challenge for us, the big hurdle for us was we had to convince the federal government, the Department of Interior, specifically the Bureau of Ocean Energy Management, they manage the lease areas on the outer continental shelf, much like they do with oil and gas. It's a similar process. And we had to convince them to recognize a community benefit agreement in their leasing auction process. We as an organization had to qualify as a community benefit organization or a CBO.

And the threshold for us to having to convince the federal government of why a community benefit agreement should be included in the auction process. And we did some research on this. And there were studies that showed that if a developer were to partner with a community benefit organization and have a community benefit agreement, that the project would be more likely to succeed. And that was a really important fact. And that was a really important piece. And that's what kind of took us over the edge and got the federal government to recognize that in that auction. And we signed the first community benefit agreement with Vineyard Wind, and they got a 10% discount in the auction at the time. And again, that auction went for, let's say $180,000. It was not like the auctions out here.

So Vineyard Wind, in their blood, it was like, you know, they weren't doing this for money. They understood that it was important coming out of the Cape Wind process, which was the failed project again, that it was really important to get the community backing and go from there. And so far, it's been a really amazing success. They've been a really great partner. And we've been able to, we're in the process of developing the operations and maintenance facility on the island right now. So there's tens of millions of dollars of infrastructure being developed on the island. They're going to be hiring 50 plus folks. We started a training program here for islanders to become wind farm technicians.

We're also getting, initially with Vineyard Wind, $7.5 million over the next 15 years to help us with resiliency, battery, and solar development at critical facilities across the island, as well as helping income eligible or low income rate payers buy down their electricity bills. So that was one thing that we wanted as well, is to create some access to low income rate payers in helping them get relief. We have some of the highest electricity rates across the country. So I know that was a lot and I appreciate the time there, but I'll just maybe pause. All right.

WHEELER:

Well, thank you, Erik. And I'm sure that Katerina and I are going to turn back to you and Eddie throughout the rest of the conversation to ask, well, so how did you do this in the past as we are contemplating how to get these community benefits for our Humboldt County community? Katerina, I want to turn to you and give you an opportunity to introduce yourself and introduce the CORE Hub at the Humboldt Area Foundation. I'm not sure if the CORE Hub has been on a previous EcoNews report, so this might be the first time listeners have heard of this exciting new project at the Humboldt Area Foundation.

OSKARSSON:

Great, thank you, Tom. So I'm Katarina Oskarsson, the Executive in Residence with the Redwood Region Climate and Community Resilience Hub, or CORE Hub for short. The CORE Hub was established in 2021 by regional leaders in climate resilience and it's based and incubated at the Humboldt Area and Wild Rivers Community Foundation. Our overarching goal is to support the region in becoming the first proven carbon sequestering rural and tribal area in the US by 2030. A really bold goal. And we do it by providing community engagement, technical assistance and capacity building resources to help the region transition into a more climate resilient and clean energy future. And we do it in a way that centers equity by ensuring that as we mitigate and adapt to climate change, benefits really accrue to disinvested and marginalized communities to the greatest extent.

As part of this overarching goal, the community's request, our major effort has been around community engagement and community benefit strategies, the offshore wind industry cluster. And by cluster, we really mean not just these offshore wind farms in the ocean, but the entire ecosystem around that, including the transmission infrastructure, the port development and enabling infrastructure and services that will be necessary for that industry to be viable and successful here and beneficial to our region.

So to that end, Core Hub has been a convener of the North Coast Offshore Wind Community Benefits Network, which is a diverse group of tribal nations, local government agencies and educational institutions, labor leaders, local community based organizations and community residents. So really a wide range of interests from our region. And this North Coast Offshore Wind Community Benefits Network that we convene have really come together through a collective interest and belief that as our rural and tribal region hosts offshore wind development, the people here really need to lead and shape what it looks like.

It might be done sustainably and it must equitably benefit our communities beyond jobs, especially those communities that have been historically and systematically harmed by past extractive natural resource industries here, from the gold and timber rushes to the cannabis rush, as well as hydroelectric, power electric solutions. So we really see this opportunity to do things differently and set a new standard for how responsible development happens.

WHEELER:

It sounds like with community benefit agreements or with developing community benefits with developers, there's a couple of different potential purposes for this. We have developing the infrastructure necessary to make these projects work, whether that's the human infrastructure, having the daycares, having the housing necessary for all of the workers who are going to be constructing the wind turbines, who are going to be part of the operations of those wind turbines. So it's in the developers' favor to have that sort of stuff together. There's also a degree of social acceptance within the community for these projects.

Katerina, you referenced the history of economic exploitation that our region has experienced from the first days of Euro-American settlement up here to the present. It's been a pretty sordid economic history. This is also a statement by these companies in part that this is going to be different. We are going to invest in the community and hopefully this has buy-in and creates better buy-in from the kind of diverse communities of the North Coast on this project. Erik, I think you spoke to the fact that when you have the buy-in from the community, when you have community benefit agreements, these projects are ultimately more successful. They're more likely to occur. So a lot of reasons to do these things.

Katerina, you also mentioned developing a more just and equitable economy so that we can see the benefits flowing more evenly to all peoples and not just continuing to favor the privileged economic classes up here on the North Coast, the good old boys network, but the benefits are spread more widely. A rising tide lifts all boats. Since this is offshore wind, I can use those sorts of metaphors.

So Eddie, I'm going to turn to you. In trying to negotiate with these offshore wind companies, when is the time that we should be doing this? Is this work now? Is it in the future? Just to back up for one sec for listeners, offshore wind energy development, it's going to take over a decade for us to see turbines out on the ocean who are producing electricity and then for that electricity to be flowing back to land. We're talking about a very long process here. When is the ideal time to reach out to the developers to start to negotiate these things? And how particular in your mind should our asks as a community be?

AHN:

Tom, the timing and the time to engage is now. So I think this is where Core Hub and the Humboldt Area Foundation have been so valuable in organizing the community, getting different groups, diverse interests in this together in the same room, because ultimately a community benefits agreement is an agreement between the developer and a coalition of organizations. It can theoretically be individuals, even like individual families or homes, but ideally these are larger organizations that represent the community from different angles that ultimately agree on whatever set of benefits. And to use another metaphor here, in that way, the sky's the limit. Like it's really determined by what the community want at the end of the day, but being very specific about what you want really helps both ends signatories to the agreement ultimately keep to it, because it's not just about signing your names on a piece of paper, it's about being able to execute on whatever's agreed to as well.

WHEELER:

Thanks, Eddie. Erik, from your experience, what should Humboldt County be thinking about at this stage? We just had our lease auctions last December, which went for just an astonishing amount of money, hundreds of millions of dollars. I was shocked, but I think it also shows the degree and the commitment of these offshore wind energy developers to have a successful project up here. What lessons did you learn, perhaps the hard way, out of Martha's Vineyard that we should know here in Humboldt County?

PECKAR:

Yeah, I mean, it's not necessarily a kind of a one for one because, you know, our geographic location on an island is not necessarily an ideal spot for, say, an O&M facility, but we really worked with Vineyard Wind to really push that and they listened. So that was really positive.

WHEELER:

Operations.

PECKAR:

Maintenance. Thank you so much. Yes. And so I think in terms of what y'all are thinking about here, what things could this project bring to the community to help the community reach its goals? And for us, it was there's certain renewable energy goals, and I'm just not as familiar with maybe the particular renewable energy targets or, you know, carbon negative targets that you are looking at Humboldt or in the region. I was lucky enough to come out a few weeks ago to Humboldt and meet a few folks. And there was a lot of people talking about microgrids, which access to electricity and reliable electricity and redundancy and those types of things and resiliency.

It's all very similar to kind of what we have on the on Martha's Vineyard as well, being in an isolated community where we have four cables that connect us to the mainland. I know the transmission is a bit of a challenge up here. So so I think kind of throwing some words out there, but I think being just very like just kind of thinking about broad scope, broad brush, what what what things could really help you all in that in that regard over the long term, I think in kind of narrowing that scope. And again, it's one of these things. It's an exercise. You know, it's like you all might have an initial community benefit agreement that evolves over time to something a little bit more specific. It's maybe not just like one time and that's it. You get one one bite at the apple. It's like it can it can evolve. And in our community benefit agreement really evolved as well.

Initially, again, our timing was a bit different than what you all have here. But but but just thinking about it, it can be an evolving document. That's not necessarily something that just like locks you in and this is what you have to do. It can it can really be an iterative process with the developer and the developers, I should say, to figure out what are the exact needs of the communities. And that might change over the next couple of years, too. I think being dynamic also, I think, is really important.

AHN:

Yeah, I think the things Erik mentioned are really important. Just understanding that there's a lot of infrastructure behind even the offshore wind farms, whether it's port infrastructure or transmission. These are all points in the process that are related to how large these offshore wind farms can be built out. And then also the other end for the community is like how large can the community benefits be for the community will be probably measured by how large or how much the community is willing to accept this infrastructure.

WHEELER:

To Eddie's point, just on transmission infrastructure, the big overhead lines, or perhaps undersea lines for our project, we're looking at $1.7 to $4 billion worth of necessary investments just to get the power from this project to be able to serve the community. So it's an astonishing amount of money that's going to need to go into this project. We have a lot ahead of us.

Katerina, I know that you have had discussions with tribal nations, with labor representatives, with environmental groups, with adjacent communities to where these wind turbines are going to be hopefully built. You've heard a lot of varying and different perspectives. Do you have kind of a coalescing list of things that you see that are going to be necessary within a community benefit agreement for this project to be successful? We do this all by Zoom, and I saw you raised your hand. So if you want to piggyback off of Eddie and then answer that question, that's totally fine too. Yeah.

OSKARSSON:

I think one thing that I think it's also important to remember is that the community benefit agreements with developers are an important, but just one option, right, for achieving community benefits. It's really important for us and for the communities to really think about these other ways that are available to us, such as state and federal advocacy to shape regulatory requirements and permit requirements, really taking advantage of state and federal funding sources that are out there, right, these historic unprecedented funding sources that are available for infrastructure and climate resilience services, because these developers are not going to be obviously able to pay for all those things that the community is in need of, right.

And so actually with the Offshore Wind Community Benefits Network, we are pursuing all of those strategies. Tom, back to your questions on sort of a list of the main areas of interest that we see in the community, there are definitely interests around community infrastructure and services, sort of big, big bucket of needs, environmental protection and compliances.

WHEELER:

So, so community infrastructure and services, this is talking about the, the, the human community, the human infrastructures, things like housing, given our housing shortage, I assume. It is.

OSKARSSON:

For example, a development of a community benefits fund that would cover future investments in transportation, recreational and outdoor access, vital infrastructure, such as health services, childcare, commitments to seed funding to focus on expanding community capacity and setting the foundation for an inclusive and equitable community-governed fund. Given the severity of affordable housing crisis, this fund would also, for example, include a dedicated funding stream or commitment to pay into a regional housing trust fund, so physical infrastructure as well as social infrastructure services.

Another big topic is, of course, environmental protection and compliances that goes beyond mitigations, right? So for example, most recently, as related to the development of the port or the heavy wind terminal, there is a strong interest in developing and operating a zero emission wind terminal by 2030, which is one of the community benefits we hear a lot about. Another topic area is around workforce and economic development. So community really wants to see commitments to partner with and invest in career pathway programs with local educational institutions and workforce partners in alignment with regional economic and workforce development strategies.

Another area of focus is community-centered decision-making, outreach and engagement to make sure that there is a local community's long-term engagement plan, and then of course, local fisheries protections and sort of, you know, the list goes on and on.

WHEELER:

I'm sure it does. And with a list that goes on and on, I imagine that we're going to run into some point where the wind energy developers are going to want to say no. Right? I think that we all look at them as these funny Europeans who have big bags of cash who might come into our community to just like have free healthcare or something like that, right. When we run into no, or when we're running into resistance.

So Eddie and Erik, I want to turn to your previous work. What do you think is going to be the most effective means of negotiating these community benefit agreements, right? Is it, is it coming from a place of opposition or, or antagonism? Is it, is it making yourself as big and blustery as possible and kind of negotiating as Eddie and I might has trained attorneys in a kind of confrontational style, Eddie, I'm not, you're a very nice guy, much more confrontational, I'm sure than you are. But is it that approach, which is kind of a standard negotiating tactic, right, or is it coming from some other position? Erik, I know that you have actually done this with a wind energy company and a wind energy company that's going to be here. So Copenhagen Infrastructure Partners is also behind the Vineyard Wind Project. Copenhagen infrastructure partners was a successful auction winner of one of the offshore wind energy sites off of Humboldt County. So what was your experience like in negotiating a community benefit package?

PECKAR:

For us, it was always about a partnership. It was never like a one-way street of, you know, we just want this and you do this for us and that's it. For us, it was we want offshore wind also as a community. We want some benefits of that and we understand that we can't get those benefits unless the project succeeds.

So for us, it was always about, from a community standpoint, supporting the project and making sure that the project got through and what does support look like? That means, you know, community members showing up at hearings on a federal, a state, and a local town level. And it means, you know, people, you know, writing in letters and, you know, across the board, you know, basically to us, the Community Benefit Agreement was essentially a true partnership. And again, that's why I said it evolved and it becomes a partnership. And that's when you kind of really reach like, you know, kind of the magical space where the community is really thriving and getting what it needs and the developers also achieving success.

And one of those successful things is also, you know, when there's competitions that have power purchase agreements, and that's going to be happening here in California with utility companies at some point. And one of the reasons why Vineyard Wind was successful in getting their the first request for proposals that came out from Massachusetts, this is under the Massachusetts law that passed, required the utility companies to buy offshore wind. And they solicited a number of bids from offshore wind developers south of Martha's Vineyard. And Vineyard Wind was successful in getting the first round of bidding, against kind of at all odds. It was kind of David and Goliath, they were going up against Orsted at the time, and they're the global leader in offshore wind farm development. And here's a little Vineyard Wind coming along.

But Vineyard Wind had the Community Benefit Agreement. And that's what really in the state's eyes and the decision-makers eyes of choosing which developer to award the contract to, obviously price is really important. But also understanding that you have the community backing behind you, and knowing that that that made it a little bit safer for for the project to be chosen by by the decision makers at that time.

WHEELER:

Eddie, any thoughts on kind of negotiating tactics on how to get a community benefit agreement agreed to by the...

AHN:

Maybe one. I liked how Erik described this as a collaboration over at Brightline, our nonprofit. The way we think about this is that it's always important to be generous, whether it's with the communities we work, or if it's a private sector or government agency staff that we also interact with a lot to understand that everybody has their own viewpoint and their own set of motivations as they come to this. And then I think at the top, most people would realize it's impossible, close to impossible, at least to get to 100% agreement on everything around this. And that we shouldn't treat offshore wind at the end of the day.

I hope no one is delusional enough to say it's the cure-all for all social ills throughout the region, or somehow, you know, the magical solution or silver bullet for everything that's going on around climate change. It's a solution. It can solve some ills, but we shouldn't overstate it as well. And that will help measure both sides' expectations and hopefully get to a more reasonable agreement.

And then the second thing to think about is that if it boils down to a more contentious kind of a set of engagements, or if the relationship sours, in other words, to treat it perhaps more as a transaction at the end of the day is not out of the question either. And that if you look at not just even community benefit agreements, but host community agreements, which are a much more formalized arrangement between say local towns or cities, as it relates to offshore wind, and then building a little substation on a parcel of land in exchange for a payment schedule, it can get down to that nit and grit as well. But again, in an ideal world, community consensus is reached in the way Erik described, and I think that's important to work at, at least for the next few years.

WHEELER:

Years, as I said, this is going to go on for the next decade. So I'm sure that all of us will be on a future econ news report in the future, talking about how we were so successful in getting community benefit agreements and making this a successful project. So I would like to thank everybody on the show, Eddie on from Brightline Defense, Erik Peckar from, from Vineyard Power and Katarina Oscarson with CoreHub at the Humboldt Area Foundation. All right. Well, thanks folks. Cool. Thank you all for joining the show. Bye everyone. And join us again next week on this time and channel for more EcoNews.