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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 joining me is my colleague and friend, Matt Simmons, Climate Attorney here at EPIC. Welcome to the show, Matt. And Matt, we are joined by our friend, Jen Kalt, Executive Director of Humboldt Waterkeeper. Hey, Jen.

All right, so we are talking about the future of offshore wind this week. And you may have seen the news recently that the energy company RWE, one of the two lease holders for the Humboldt offshore wind area, has settled with the Trump administration and will rescind their lease or give back their lease, or I'm sure that there's some technical legalese there, abandon their lease. And in exchange, will get money from the federal government to invest in fossil fuel infrastructure. So this has a lot of people wondering, what is the future of offshore wind? Is this the death knell of this industry? So we are going to go into all of that and more in this week's show.

All right, let's begin at the beginning and go back to maybe 2019 or so and the development of these offshore wind leases. We have an agency, the Bureau of Ocean Energy Management, who in response to a solicitation from RCEA expressing interest in offshore wind, decided to open up a competitive lease process off of the Humboldt coast. This concluded in somewhere, I think, around 2022. And Matt, do you want to take over the storytelling from here?

MATT SIMMONS:

Yeah, and something I want to get out there is, it was a very long process to even decide what area of the ocean could be leased. The wind energy area started 20 miles off of our coast in part to reduce conflicts with fishermen and wildlife and views from the shore, and so there was a multi-year process just to narrow down what area of the ocean would be leased to offshore wind developers. And then in 2022 the Biden administration held a lease auction, where offshore wind companies could bid on the right to investigate whether or not they could put offshore wind turbines off of our coast, and the two companies that won the leases off the coast of Humboldt were RWE and Vineyard Offshore. And since 2022 those companies have been doing a lot of outreach in Humboldt, trying to understand the local community and what they need to learn about before they develop their project.

Obviously Donald Trump is then elected president again and Donald Trump hates offshore wind, and so on his very first day in office he issues an executive order telling all of his agencies to do everything they can to stop offshore wind projects from happening and going forward. That executive order has been overturned by a federal district court judge as being illegal, because it was an overstepping of his presidential authority. He also had agencies revoke permits -- illegally, again, judges have said that these were illegal actions -- and now he is switching to a new illegal action which is to use your taxpayer dollars to pay these companies not to develop offshore wind.

So for example: In exchange for not doing offshore wind in their three lease areas, Trump is giving RWE, a German company, 1.2 billion of your taxpayer dollars just to not develop energy. That brings the grand total of the amount of your money that Trump has spent this way close to four billion dollars on the East Coast, in the Gulf of Mexico and in the West Coast, and that's where we are.

WHEELER:

And just kind of briefly, there are two -- or there were -- two leaseholders, RWE is one, the other is Vineyard. Vineyard is, I think, a distinct and different company than RWE. RWE, as Matt mentioned, is a German energy company, and they have investments in everything, nuclear, coal, natural gas, wind, solar. And so they, I think, were more uniquely positioned than Vineyard to be interested in this sort of settlement because they already have other ongoing projects, fossil fuel projects in the United States, where they'd be happy to take federal money and dump it into those. Vineyard, by contrast, only does wind. They were a company on the East Coast to develop offshore wind off the coast of Martha's Vineyard, hence the name.

SIMMONS:

Their parent company, Copenhagen Infrastructure Partners, only does renewables. They only do wind and solar. And so they're less likely to be able to take a deal saying we'll do fossil fuels instead of wind.

JEN KALT:

It kind of brings up a little bit of the hesitation that a lot of people had in the beginning of this, to be selling offshore leases to fossil fuel companies in the hopes that they would be developing renewable energy projects. But back to the idea that this is taxpayer dollars, some people have asked, well, wasn't that RWE's money in the first place? I mean, they paid for that lease, or those four leases, that they just got the money back for. So can you explain where does the money go for those offshore wind leases and why you're saying that it's our taxpayer dollars when they initially paid for the leases?

SIMMONS:

Well, so the money comes out of a thing called the Judgment Fund, which is a pot of money that exists for the federal government to settle lawsuits when they lose a lawsuit. It's actually the same pot of money that Trump is using to support his January 6th rioters and their legal dealings when they're accused of other crimes. And so it's two different pots of money, right? Like, RWE paid in to the federal government when they leased the areas, and now Trump is paying them with taxpayer dollars from a different pot of money.

I will also say part of the reason why the state of California, and I haven't gotten to this yet, but the state of California has filed a subpoena and a notice of intent to sue on the leases being bought back in this way. And part of the reason, part of the argument that they're making is that before a company can abandon a federal lease, there are very specific steps that they have to take under the Outer Continental Shelf Lands Act, and Trump never follows the rules for anything. And so he didn't follow any of these steps.

And so in some reporting, people are acting like these leases are gone, and they're only gone if you think that the law doesn't matter or exist, right? Because this is an illegal action to abandon these leases. The state of California is going to defend its interests in having renewable energy off of our coast. And I think courts have so far routinely shot down Trump when he tries to take these illegal actions to attack offshore wind.

WHEELER:

All right, and we'll get into more of the legal response to this in a little bit. So when we talk about offshore wind, I think that we often talk about three distinct components and RWE's acceptance of this settlement offer from the Trump administration might influence all three. That said, the state of California and local governments have distinct responsibilities and abilities to influence two of these.

So when we talk about offshore wind, we're often talking about the heavy lift marine terminal that is being proposed by the Humboldt Harbor District. That is where conceivably offshore wind turbines would be assembled and serviced for when they're in operation. We are also talking about the actual operation of these wind turbines out in the ocean, 20, 30 miles offshore, and we're talking about the grid infrastructure upgrades necessary to bring power from the turbines to end users, both in Humboldt and elsewhere in the state of California.

So as I said, we have as local governments, as a state government, more of an influence in two areas, that being the Harbor District's project, their heavy lift marine terminal, and in infrastructure, the grid infrastructure necessary to bring the power to users.

So let's start at the Harbor District. I had Chris Mikkelsen, the executive director -- is that what they call him at the Harbor District? -- on KMUD the other day to talk about RWE, and I asked him what the decision means for the Harbor District's project. And he said it means nothing, that they are going to continue to design this project in the manner that they were proceeding, that they had determined, and so they are going to have it permitted for what they might call the full build scenario, where all components of the project are necessary, where it is the total site development, and that that's where they are, and that when it comes to the construction and operation of the heavy lift marine terminal, it might be slightly different than what was permitted, that they are going to try to get everything permitted that they can, but that in reality, they will likely develop something in phases and phase it in such a way that it meets the direct needs at the time that it's being constructed.

So it might be that a project begins more slowly before full build out or may never get to full build out. So here is an opportunity for an interesting, perhaps, disagreement between EPIC and Humboldt Waterkeeper. So Jen, I know that you have some thoughts about how the Harbor District should conceive of its project in wake of RWE. Do you want to describe those?

KALT:

Sure, thanks, Tom. Yeah, so as you two have been doing, we've been studying these proposals, particularly the offshore wind terminal project in Humboldt Bay for, what, four, five years now? And Humboldt Waterkeeper's mission is to protect the bay and the people who rely on the bay and make sure that development is as protective of Humboldt Bay and all the people who use the bay as possible. And so the fact that two out of the three offshore wind developers that the terminal project was designed for are now out of the picture, or maybe out of the picture depending on what happens with the lawsuits. I don't know if the lawsuits will make that money magically reappear in the...

Anyway, it's hard to have a crystal ball on that, and we'll get to that later. But for someone who is mostly focused on the impacts to the bay and how best to avoid and minimize and mitigate them, as we say in environmental impact assessment conversations, this would be potentially a good opportunity to reconsider getting the biggest project possibly imaginable permitted and instead consider something that would be scaled to Humboldt Bay, something that would serve the Vineyard Offshore Wind Project perhaps, which given what's going on now. It's conceivable that Vineyard could hold on, just keep that money invested and just wait it out, and then proceed and get there first, and then the next company might be able to use the same smaller terminal once Vineyard's done doing all the assembly.

Part of the thinking here too is really downsizing the temporary storage that's being proposed right up against Tulawat Island right now, which would have a lot of impacts during both construction and operations on Tulawat Island and the people who consider it to be the center of their universe, the Wiyot people. And the construction of these things is going to cause a lot of noise disturbance, a lot of visual disturbance.

The plan as it stands today calls for over 4,000 piles to be driven, and over 400 of those are right up against Tulawat. And we know that the Harbor District is going to be revising that project description that they released in 2024 for the next phase of their CEQA process, the California Environmental Quality Act review process. The Harbor District will be releasing a notice of preparation of a draft EIR sometime in September, they say now. And with that, we call it the scoping period, and they're going to, the scoping process, sorry, they're also going to be releasing a new project description, which we don't know how much that will change.

But Humboldt Waterkeeper feels strongly that this is a good opportunity to reconsider the scale of the project. The Harbor District doesn't have site control over all the properties that it's proposing to build this terminal on, and they recently announced that they're making phase one even bigger than it was before.

WHEELER:

You are listening to the Econews Report. And we are talking about the future of offshore wind off of Humboldt's coast.

KALT:

But you know, all of this relies entirely on massive state and federal subsidies. It's never gonna be built by a developer. It's not gonna, you know, entirely by a developer's funding. So there's a lot of talk about how it wouldn't pencil out to build a smaller terminal, but it wouldn't pencil out either way. We, the taxpayers, are gonna be paying a massive subsidy for this project. And so we, the taxpayers, and the people who live here in Humboldt Bay and support the Wiyot tribes' rights and cultural practices and the shellfish industry and all the other things we care about in the Bay, we should have a voice in saying where our taxpayers' dollars are going.

WHEELER:

So I will make the argument for maintaining the course, which, in other words, is let's continue to plan a heavy lift marine terminal that would be capable of constructing and servicing an area broader than just the Vineyard lease area. And the argument goes like this. We made substantial progress towards permitting and developing this offshore wind farm in a very short period of time. So if we go back to when the leases were approved by the Trump administration to the first day of the Trump administration, there was a lot of development in that time. When the federal government is aligned in its purpose towards developing offshore wind, I think that we could move quickly. And we don't know necessarily what the future of offshore wind as an industry is going to be. At present, the Trump administration is really trying to use all parts of its all parts of its being to thwart the offshore wind energy industry.

But that industry has a lot of potential for a lot of reasons. And it might be that in the future we're going to get more normal Republicans and more normal Democrats who want to invest in American energy independence through renewables. And that future almost by necessity is going to require a significant component of offshore wind because of the grid reliability that it offers, because of the massive amounts of energy that is capable of producing. So I don't think that we should handcuff ourselves at this point and say that we should start to shrink the heavy lift marine terminal for a future that is a bit unknown.

So if we permit a project that is allowed to be larger, and in the future, that doesn't come to pass, that's fine. The kind of phase development that the Harbor District is talking about will only will only construct a port facility that is going to be appropriately sized. But if the future is different, if we have offshore wind off the coast to Del Norte County and Curry County and south off Mendocino and Sonoma, as was once envisioned, well, let's allow for that or let's not handcuff ourselves at this moment. Matt, any...

SIMMONS:

So I guess I'll just hone in on something you said, which was why we're doing offshore wind in the first place. And so when California, when the California Energy Commission does their scenario planning of how do we achieve 100 percent renewable energy by 2045, which California set a goal for itself to do in SB 100. And so we made it law that we have to achieve 100 percent renewable energy on our electric grid by 2045. And the reason we set that date was because climate scientists were saying to do it faster than that. And politicians were like, whoa, that's too fast. We've got to slow down and only do this by 2045.

So when they look at the scenarios of how to achieve that offshore wind, because it generates a lot of electricity and in particular, it generates a lot of electricity after the sun has gone down, makes it a lot more efficient to achieve that 100 percent renewable energy than you could do other ways. Like there are other ... you could do a ton of solar and batteries or you could keep nuclear on the grid or geothermal. But offshore wind helps bridge that particular window. And the offshore wind resource off the North Coast is the best in the state of California. And so with Donald Trump attacking this resource, I would not want to see Humboldt in California back down. Instead, I would rather we continue to push for the climate that the climate future that we all need by continuing to support projects to support that.

Now, that doesn't mean that we don't do a permitting process, that we don't have serious conversations about how much wet storage there should be, when the pile driving should occur. I think all of that needs to be worked out and discussed and that every single person impacted by the project needs to have their voice heard. But I think that that's going to be a long process. And so it's better to keep that process going during this pause on the offshore part so that in 2029, with a new president, we don't look back at this time and say, why weren't we working on this that whole time? Because if a new president comes in in 2029, the way Joe Biden did and says, hey, I care about climate change again, where's that offshore wind that California keeps talking about? I want to be ready for that moment.

WHEELER:

So, inspired by Matt's comment that these dialogues are good, there is an opportunity for the public to engage on the scope and design of the heavy-lift marine terminal coming up. Jen, do you want to give what we know about the scoping for the heavy-lift marine terminal?

KALT:

Well, what we know is that the Humboldt Bay Harbor Recreation Conservation District is working with consultants to prepare a notice of preparation. And what that will ask the public and anybody who's interested in commenting on this project is what should be studied in the draft EIR, the Environmental Impact Report. So we've been studying the existing project description, which is quite extensive, and there will be a revised one, but things like, well, there's up to two concrete batch plants proposed for the Samoa Peninsula. What do we, the public, and the people in Samoa, and the shellfish growers, and the Wiyot tribe, and everyone who cares about the bay, think needs to be analyzed in the draft EIR? And then also, what sort of alternatives should be considered and what sort of mitigation measures should be considered?

So we've been studying up on things like, what are the impacts of concrete batch plants? Because we don't really, I don't know if we have any of those in Humboldt County. We have asphalt batch plants, not concrete, though. And so people have asked a lot of questions, and those are the kinds of things that the Harbor District and their consultants will need to respond to. So putting those comments in writing and also going to the scoping hearing is important, but especially putting those comments in writing. And so Humboldt Waterkeeper is planning some, at least one, public workshop to talk about this process and help people write comments. And I don't know if EPIC's going to be a part of that too, but we're waiting to see when it comes out to make final plans on that.

WHEELER:

All right, so we still need to talk about transmission. Matt, do you have any understanding of how RWE might influence Viradon, the transmission developers' plans for connecting our area to the larger grid?

SIMMONS:

Yeah, so really quickly, essentially every year, the California Independent Systems Operator, CAISO, issues a transmission plan where they take a look at where all the electricity is needed and where it all is likely to come from, and then they update iteratively where new transmission lines should be built in the state of California. A couple of years ago, one of those plans said, hey, this Humboldt wind energy area is moving forward. We should start to plan for some transmission lines to go there.

But there were other reasons why we need these transmission lines. Humboldt's grid is very old and unreliable. We also have the Humboldt Bay generating station, which currently burns natural gas in order to generate electricity. And I said earlier, by 2045, we need to stop burning all fossil fuels in order to generate electricity. You can't turn off that plant without connecting Humboldt up to the rest of the grid so that we can get solar from the desert and wind from inland and send offshore wind to people. We need to be more connected to the rest of the grid if we want to shut down our local fossil fuel generating station.

And so I imagine CAISO will be looking at the news that RWE has entered into this, and potentially, maybe, it hasn't happened yet, but it could happen, putting the in-service date for these transmission lines farther into the future. But this was always going to be a more than decade-long process. The current contract that Vierdon has with CAISO says, let's get these transmission lines built by 2034. And so if they push that back a little bit, it'll still be a very long time before anyone sees these new transmission lines. Is that a good explanation of where we're at?

WHEELER:

That's a great explanation. All right. So, Matt, you suggested that the state of California and others are likely to litigate the RWE settlement. Do you have any more information you can share or thoughts about that legal proceeding, anticipating a legal proceeding?

SIMMONS:

Yeah, so the California Energy Commission and the state attorney general have issued subpoenas to the three offshore wind developers that have taken the bio deal, and they've issued notice of attempts to sue to two of them, and we're all expecting a third. Essentially, what the subpoenas say is we think what you did is legal. Keep all of your documents so that we can look over them when we're suing. The East Coast has also seen litigation already filed against the East Coast version of these deals. So the state of New York and New Jersey and Connecticut, I think. And so the East Coast is actually a little bit ahead of us, because the deals were entered into sooner there. And so we'll be able to watch what happens on the East Coast with this litigation.

One thing I'll note is that if I was a business that owned any kind of federal lease to do anything, I'd be very worried about these sort of buybacks being allowed the way that they are, because it really threatens just the entire concept of industries doing business with the federal government. And so I think that there are likely to be folks who are interested in this litigation beyond just the offshore wind world, because it's such an example of a president using their authority to bully an industry in a way that typically we don't see in America historically.

WHEELER:

OK, so as we mentioned at one point in this show, both the transmission development and the harbor development are things that local governments have more control over, or the state government has more control over. So I think that one thing we've talked about at EPIC is using this period where obviously the federal government's not going to be doing its job and it's making everything harder to continue to engage on the state and local processes so that if offshore wind does happen that we have positively influenced the development of both the transmission plan and the heavy lift marine terminal. So that's all the news I think that we know at this moment. Of course, when any other information breaks about the future of offshore wind, we will be back with another Econews Report.

Thank you to my guest Matt Simmons, Climate Attorney here at EPIC, and Jen Kalt, Executive Director of Humboldt Waterkeeper, for joining the show.

KALT:

Thanks so much for having us, Tom, and we'll have a lot more conversations about this, but in the meantime, people should check our websites and join our email list for the latest information.

WHEELER:

Yeah, that's humboldtwaterkeeper.org and wildcalifornia.org. All right, until the next show, be well. Well, that's all for today's show. Join us next week on this time and channel for more environmental news from the North Coast of California.