Nighttime I-95, Merritt lane closures planned in Norwalk, Darien, New Haven for pavement upgrades
To extend the lifespan of the pavement on the Merritt
Parkway and Interstate 95, the state Department of Transportation is conducting
an $18.8
million preservation project on those roadways in
Norwalk, Darien and other municipalities.
“The Connecticut Department of Transportation is announcing
the start of a pavement preservation program to improve the existing wearing
surface and extend the life of the pavement on Route 15 and Interstate 95 in
Orange, Woodbridge, New Haven, Darien and Norwalk starting on April 8,
2024,” a
DOT statement said.
Between Exits 10 and 16 on I-95, lanes will be closed at
night on weekdays from 8 p.m. to 6 a.m. Daytime lane closures will be limited
to between 9 a.m. and 3 p.m.
“Traffic signal detection systems will be upgraded at two
intersections in Darien and one intersection in Norwalk” as a result, DOT said.
In Orange, Woodbridge and New Haven, lane closures
along the Merritt Parkway will also occur between exits 56 and 59 from 8 p.m.
to 6 a.m.
“Construction will require various ramp closures on I-95 and
Route 15" and traffic detours overnight, the DOT statement said. “Traffic
control personnel and signing patterns will be utilized when needed to guide
motorists through the work zone. Motorists should be aware that modifications
or extensions to this schedule may become necessary due to weather delays or
other unforeseen conditions and seek alternate routes.”
The project began on April 8, and will last until December.
Tilcon
Connecticut Inc. of New Britain was awarded an $18,861,960 contract
for the project, which is administered by the Bureau of Engineering and
Construction.
Offshore Sector Gathers Second Wind After Several Setbacks
Let’s call it a reset in real time.
Players in and observers of U.S. offshore wind energy say
the sector is showing encouraging signs of recovery and progress after in the
past year producing a series of headlines about investment write-downs, project
exits and attempts to secure higher future prices.
Among the recent happenings:
Four development teams, including Avangrid Inc. and Ørsted
A/S, responded to a solicitation from New England states with proposals to
build up to 5.5 gigawatts of capacity
The Federal Energy Regulatory Commission approved a large
generator interconnection agreement between Equinor’s Empire Wind 1 project,
New York ISO and Consolidated Edison, the first time the agency gave the nod
for an offshore wind project to connect directly into New York City’s
transmission system
National Grid Ventures and a Con Ed subsidiary submitted a
proposal to build transmission infrastructure to carry offshore wind power to
New Jersey’s electric grid
Lots of work remains to be done to complete those plans but
it appears unlikely they’ll face the same buffeting that projects started a few
years ago have had to endure. Those developments—which include the Empire Wind
2 plan, whose contract Equinor and bp canceled early this year—faced something
of a perfect storm: After developers penciled out business models and secured
power purchase contracts before the arrival of COVID-19, supply-chain snarls
caused by the pandemic jacked up prices for the materials and equipment they
needed and the Federal Reserve’s interest-rate hikes added immensely to their
financing costs.
On top of that, Enverus Vice President of Commercial Product
Sarp Ozkan said, the costs of interconnection infrastructure also have climbed,
putting more pressure on wind farms’ financial models. In all, S&P Global
analysts recently projected that project costs have risen nearly 50% from their
pre-pandemic starting points. That’s more than enough for some serious
soul-searching and spreadsheet revamps.
Some policy support—but not yet from interest rates
Few people are questioning the long-term growth prospects of
offshore wind. Analysts at Intelatus Global Partners early this year stuck to
their forecast that developers will build more than 65 projects with a combined
capacity of 94 GW by 2040. Technologies are becoming more powerful and
efficient and the supply chains needed to support the sector’s growth are
growing.
In addition, government agencies and regulators at the
federal and state levels haven’t wavered in their support of long-term goals. A
recent case in point for the latter is a U.S. Department of Energy evaluation
of transmission needs off the Atlantic Coast that recommended connecting
projects’ transmission networks offshore and creating shared transmission
corridors. Such a strategy, researchers said, could be at least twice as
cost-effective as individual transmission connection projects.
Add to the federal regulatory momentum FERC’s Order No.
2023, which was announced last November and aims to speed up work on
interconnection projects. That will help, Ozkan said, but it is only in the
early stages of being implemented.
While there is some potential risk that federal support
could wane if Donald Trump is again elected president in November, it’s
important to remember that many of the key decisions made about these projects
come from state officials, said Kevin Beicke, vice president of asset finance
at credit ratings agency Morningstar DBRS.
“There’s a lot going on at state levels,” Beicke said. “I
don’t really see that changing. They have their own climate mandates and they
want to realize those.”
Even if that means upsizing power purchase agreements for
offshore wind energy from their ranges of just a few years ago. In a recent
report, Beicke wrote that offshore wind development should be successful over
the long term as inflation recedes further and the sector’s supply chain
matures. What will also contribute, he wrote, is “a fresh view from all
stakeholders that incorporates the current economic environment”—i.e., one
where regulators acknowledge developers’ and operators’ higher costs and are
willing to approve payment for many of those.
In the short term, however, the biggest factor driving
development will be a retreat in interest rates. With budgets in the
billions—by way of benchmarking, Dominion Energy’s 2.6-gigawatt Coastal
Virginia Offshore Wind project is on track to meet its budgeted cost of $9.8
billion—even a small Fed cut can add up to big savings on construction
financing. That, Biecke said, makes it easier for project backers to then ask
for power prices amenable to both regulators and the consumers they represent.
“You don’t want to risk a spike right before construction
starts,” Biecke added.
A deepening pool of financing options
That renewable-energy ventures are particularly sensitive to
interest rates was made apparent April 4 after Neel Kashkari, president of the
Federal Reserve Bank of Minneapolis, said there’s a possibility the central
bank’s Federal Open Market Committee won’t cut its benchmark rates at all this
year. Shares of renewables firms were among the hardest hit in the afternoon
sell-off that followed Kashkari’s comments.
Dec. 4 – Startup EnergyRe Raises $1.2 Billion for Transmission
Development, Renewables
The pool of financing options isn’t yet as deep for offshore
wind work specifically and renewables more generally. For many
investors—including some infrastructure specialists—the risks are still too
opaque and the economics not as predictable as those of other investment
classes. Indicative of that dynamic are comments made last September by Connor
Teskey, CEO of Brookfield Renewable Partners, at the company’s investor day.
“The only reason we don't have greater exposure to offshore
today is because of our discipline to adhering to that principle of, ‘We don’t
take on basis risk,’” Teskey said. “Historically, you had to commit huge sums
of capital upfront many years before you knew the cost of building the project
or the revenue that project would attract.”
And yet: Here, too, progress is apparent. Immediately after
those comments, Teskey said:
“Increasingly around the world, projects are closer to
development. They're closer to construction and it's going to create
opportunities for us to invest without taking on that basis risk that we've
historically been averse to.”
Infrastructure-focused funds such as the one run by Teskey
and his team have become big players in the investing world. Despite a slower
2023, they have put to work an average of $391 billion each year since 2019,
according to investment data company Preqin, and they finished 2023 with nearly
$330 billion on hand.
Energy-transition projects will get a large share of those
dollars, particularly as the list of completed and transacted projects grows.
For example: Vineyard Wind, one of the teams responding to the recent New
England solicitation, is a partnership between Avangrid and 12-year-old
Copenhagen Infrastructure Partners.
Alex Ellis, a co-founder and partner of Excelsior Energy
Capital, said a more diverse set of investors is looking for deals over the
range of renewable assets’ lifespans. Excelsior is investing from its second
fund, which has a target of $750 million, and typically steps into projects as
they near completion to hold them through what Ellis calls “the teething
process.” The team in March sold a portfolio of 38 solar and solar-plus-storage
assets to BlackRock’s Evergreen Infrastructure Partners Fund, a deal he said is
indicative of the sector’s maturation.
“The market is better understanding development risk. The
rules of the road have been better defined, whether that’s for permitting or
interconnection,” he said, comparing today to when Excelsior was founded in
2017. “The average investor is better informed, more aware of the risk profiles
and knows which questions to ask.”
Offshore wind developers will need those backers and others
to continue to step up. Biecke said that, while the focus of the U.S. sector
has so far been primarily on East Coast projects, the potential for massive
floating wind projects off the West Coast is becoming clearer. And with that
big potential will, over time, come many more big-dollar asks.