April11, 2019

Mark D. Marini Secretary, Department of Public Utilities Commonwealth of One South Station, 5th Floor Boston, MA 02110

Re: Request for Proposals for Long-Term Contracts for Offshore Wind Energy Generation (D.P.U. 19-45)

Dear Secretary Marini:

We are a group of public sector, business and civic leaders in Southeastern Massachusetts, and we write to comment on the Section 2.3.2 (Qualitative Evaluation) of the draft Request for Proposals for Long-Term Contracts for Offshore Wind Energy Projects (D.P.U. 19-45), which was filed by the Commonwealth's electric distribution companies on March 27, 2019.

This letter is a follow-up to a letter we sent to Secretary of Energy and Environmental Affairs Matthew Beaton on February 26, 2019, that expressed our belief that the next offshore wind RFP should address our concern that the first RFP did not adequately encourage long term investment by the offshore wind industry in the Commonwealth, particularly in Southeastern Massachusetts (that letter, along with Secretary Beaton's response to Mayor Mitchell, are attached hereto).

We are grateful that our letter to Secretary Beaton appears to have been given careful consideration by the evaluation team. In general, on the matter of economic benefits, the Qualitative Analysis section of the draft RFP is an improvement over the same section in the 2017 RFP. We also appreciate that both the Commonwealth and the distribution companies are moving expeditiously to enable prospective bidders to begin the next project in time to take advantage of federal tax credits whose availability is scheduled to expire at the end of the calendar year.

Nevertheless, we remain concerned for the same reasons we expressed in our original letter that because the draft RFP does not establish a specific scoring weight for "economic benefits," prospective bidders will not have a clear incentive to make investment commitments in the Commonwealth. We hope these concerns are misplaced, and that the amendments reflected in the draft RFP, and others proposed below, will send a clear enough signal to wind developers that the Commonwealth seeks to secure investment of a scale and kind that will begin to anchor the offshore wind industry in Southeastern Massachusetts. Otherwise, any inevitable legislative P a g e I 2

remedy would arrive only after other states with aggressive approaches to offshore wind development will have had an opportunity to land those investments.

In addition, we believe that the draft RFP should be clarified in certain ways.

First, the RFP should place even greater emphasis on securing long term economic benefits. As noted in our February letter, we believe that the Commonwealth is at critical point in its effort to attract and cultivate an industry cluster here. Although the temporary jobs created in the deployment phase of offshore wind projects would be welcomed, the RFP should prioritize even more the long-term investment commitments that will lead to sustained employment opportunities. Accordingly, we recommend the following specific changes:

• In each of the first three bullet points of the economic benefits section, insert the modifier "long term" to characterize the nature of the investments and benefits.

• In the paragraph concerning port facilities, insert the words "over the life" after "maintenance," to make clear the operations and maintenance commitments should be long term.

• In last paragraph, insert the word "strongly" before the word "preferred."

Second, the reference to the Offshore Wind Accelerator Fund should be removed. While we appreciate the Commonwealth's intention to offer the OWAF as an example, singling out the OWAF is a serious mistake for several reasons:

For starters, it strongly implies that investment commitments to the OWAF are sufficient to satisfy the state's goals, and that other commitments are of lesser importance (and so will be given lesser consideration).

In addition, by holding out the OWAF as the sole potential recipient of investments specifically referenced in the RFP, the impression is created that worthy projects and alternate mechanisms for financing projects or programs do not exist-which is simply not the case. There are major public infrastructure projects, established funding vehicles (like the New Bedford Ocean Cluster's Innovation Fund), and offshore wind workforce training initiatives (such as those developed at Bristol Community College) that are ready right now for direct investment.

Moreover, highlighting the OWAF, whose funding could be directed anywhere in the state, is at odds with the RFP's separate requirement that investments should be primarily directed toward "economically distressed areas" of the state--not to mention at odds with the Administration's stated commitment to encourage investment in regions outside Greater Boston. P a g e I 3

To be clear, we are not suggesting that the OWAF itself be eliminated, only its specific reference in the RFP. We are convinced that, singling out a single, state-administered fund, to the exclusion of all other funding options, puts other funding opportunities at a severe, unfair disadvantage to attract investment commitments. However well intentioned, the Commonwealth should take care in the RFP not to tilt the playing field toward state-administered entities.

Third, we appreciate the addition in Section 2.3 .2 viii. that bidders must address potential conflicts with the commercial fishing industry. In the last procurement, the reconciling of the two industries' respective interests was largely left to be addressed after the procurement. By front-loading the process in the RFP- as many in the fishing industry have suggested- conflicts may be more easily avoided, and federal permitting for the winning bidder will be hastened.

This is especially important to New Bedford-based fishermen and shore-side businesses, as New Bedford accounts for virtually all of the Massachusetts landings offish caught in the Massachusetts offshore wind lease areas. Moreover, it will enable Massachusetts to set a firm precedent for the offshore wind industry's responsibility to the commercial fishing industry that will be of critical importance as new lease areas come on line in New York and other places where there is more fishing activity.

Finally, we suggest some additional detail in the commercial fishing section would more clearly convey expectations, without unreasonably burdening the bidders. Specifically, we propose that at the end of the section, the following should be added: "including commitments that address turbine adjacency and alignment, the configuration and width of transit lanes, and mitigation plans that provide for both lost business opportunity and support for innovation in the fishing industry." We believe that with this level of specificity, some of the tension between the two industries that we have witnessed in the wake of the first procurement can be avoided.

Thank you for this opportunity to offer our input.

Sincerely,

Mayor Jon Mitchell Rep. Senator Mark Montigny City of New Bedford Speaker Pro Tempore Second Bristol & Plymouth District 5th Bristol District

Mayor Thomas Hoye Rep. Antonio F.D. Cabral Rep. James Hawkins City of Taunton 13th Bristol 2nd Bristol

Rep. Shaunna O'Connell Rep. Steve Howitt Rep. 3rd Bristol 4th Bristol 7th Bristol

Rep. Rep. Rep. 8th Bristol 9th Bristol 11th Bristol Page 14

Rep. City Councillor Dana Rebeiro City Councillor Joseph Lopes 12th Bristol City of New Bedford City of New Bedford

City Councillor Ian Abreu City Councillor Scott Lima Tony Sapienza City of New Bedford City of New Bedford Chairman New Bedford Economic Development Council

Chancellor Robert Johnson President Laura Douglas Gerry Kavanaugh University of Massachusetts Bristol Community College President Dartmouth LStar Investments

Rick Kidder Mike O'Sullivan David Slutz President and CEO President and CEO Managing Director SouthCoast Chamber of Bristol County Chamber of Potentia Business Solutions Commerce Commerce

Nicholas Christ Patrick Murray David Whechsler President and CEO President and CEO President & CEO BayCoast Bank Bristol County Savings Bank Maritime International

John Vasconcellos Maureen Sylvia Armstrong Elizabeth Isherwood President President, CEO, and Owner Chairman Community Foundation Sylvia Group Insurance Greater NB Industrial Foundation of Southeastern Mass.

John G. Andrade Quentin Ricciardi Joseph Nauman President CEO Executive Vice President (ret.) Minority Action Committee Acorn Management Acushnet Company

Adam Cove Christopher Rezendes Jim 0 liveira CEO Founder and President Executive Director Edson International INEX Advisors Mas sHire Greater New Bedford Workforce Board

Scot Dubois Jennifer Downing Amanda McMullen Co-Founder Executive Director President and CEO Pidalia Leadership SouthCoast New Bedford Whaling Museum

Michael Tavares Robert Mitchell David Cabral General Manager R.A. Mitchell Company Five Star Companies Horatio's Inc Vice-Chair Greater NB Industrial Foundation Page I 5 cc:

Governor Charles D. Baker, Jr. Lt. Governor Karyn Polito Attorney General Maura Healey Senate President Karen Spilka House Speaker Robert A. DeLeo Senator Michael Barrett, Chair, Joint Committee on Telecommunications & Energy Senator Eric Lesser, Chair, Joint Comm. on Econ. Development & Emerging Tech. Senator Marc. Pacheco, Chair, Senate Committee on Global Warming & Climate Change Rep. Thomas Golden, Chair, Joint Committee on Telecommunications & Energy Rep. Ann-Margaret Ferrante, Chair, Joint Comm. on Econ. Development & Emerging Tech. Rep. , Chair, House Committee on Global Warming & Climate Change Secretary Matthew Beaton, Executive Office of Energy and Environmental Affairs Secretary Mike Kennealy, Executive Office of Housing and Economic Development Commissioner Judith Judson, Department of Energy Resources Steve Pike, CEO, Massachusetts Clean Energy Center February 26, 2019 Matthew A. Beaton Secretary of Energy and Environmental Affairs Commonwealth of Massachusetts 100 Cambridge Street, Suite 900 Boston, MA 02115

RE: Offshore Wind Energy Procurement and the Economic Development of the Southeastern Massachusetts Region

Dear Secretary Beaton:

We are a group of 4 7 public sector, business, and civic leaders in Southeastern Massachusetts vvho are increasingly concerned that the Commonvvealth's approach to procuring offshore vvind energy contracts will make it more difficult for our region to reach its full potential as a national leader in the industry.

Many of us have devoted considerable time, effort and political capital over the last several years to cultivate the development of the industry here in Southeastern Massachusetts. From the start, we have recognized that in an era in which major metropolitan areas like Boston are attracting the lion's share of investment capital in America, the offshore vvind industry offers a rare, generational opportunity for our region, with its widely-recognized competitive advantages, to attract a new industry cluster and create well-paying jobs. Although vve are excited that the offshore wind energy industry will help to lovver the state's carbon emissions, and although we are pleased that competition in the first offshore wind energy procurement resulted in electricity rates that vvere significantly lovver than anticipated, for us the effort has been primarily about economic opportunity and development.

As close observers of the offshore wind industry, we believe there is insufficient appreciation in Massachusetts for the clear-cut ambitions of other East Coast states. States from Virginia and Maryland to New Jersey and Nevv York are all explicitly competing with the Commonwealth to successfully lure the offshore wind industry to their shores. We fear that complacency and undue confidence in Massachusetts today may cost the state dearly in the future, and result in missed opportunities for nevv jobs and investment.

At the same time, it is hard for some of us--given our persistent effort to cultivate the industry here in the region--to witness the establishment of headquarters and regional offices of major wind companies in Boston, in the absence of a serious effort by the Commonvvealth to support its "Gateway Cities" policies to encourage such investment to happen here. Page 13

First, the economic benefits of the project should be evaluated in a separate step in the "qualitative analysis" to avoid the "mashed potatoes" problem in the first RFP, in which economic benefits were lumped in with criteria concerning a project's viability. That way the market will understand more clearly how investment commitments will factor into their bottom lines.

Second, because of the urgent need for Massachusetts to compete for direct industry investment, the value of "economic benefits" should be assigned not less than 15% of an applicant's total score. The other criteria concerning project viability would be assigned 10% of the total score. Although this split would still be less aggressive than that ofNew York, which assigns 20% of its evaluation to "New York Economic Benefits" and 10% to "Project Viability," it would be a step in the right direction. It is important to also note that such a change would not alter the weight assigned to price, which would remain at 75% of a bidder's total score.

Third, the RFP must state more clearly what types of investments matter. We propose that the RFP should set forth the following as the types of investments that would solidify the industry's presence here:

(a) Specific dollar investments in public infrastructure in Massachusetts that vvould directly support the offshore industry;

(b) Commitment to the leasing of port facilities in Massachusetts for project deployment;

(c) Life-of-project leasing of in-state port facilities for operations and maintenance and "control room" siting, vvith preference for publicly­ owned facilities;

(d) Long-term financial commitments to support the establishment of in-state training facilities and marine environmental research facilities, and commitments to the use of those facilities;

(e) Secured commitments to site manufacturing or assembly facilities in Massachusetts;

, (f) Commitment to site regional front offices, including those of project contractors, in Gatevvay Cities;

(g) Commitment to local hiring and contracting;

(h) Commitments to fund programs to enhance the profitability of commercial fishing businesses and ports affected by the construction and operation ofvvind projects; and

(i) Commitments to programs supporting low-income ratepayers; Page IS

John Vasconcellos Maureen Sylvia Armstrong Elizabeth Isherwood President President, CEO, and Owner Chairman Community Foundation Sylvia Group Insurance Greater NB Industrial Foundation of Southeastern Mass.

John G. Andrade David Slutz Joseph Nauman President Managing Director Executive Vice President (ret.) Minority Action Committee Potentia Business Solutions Acushnet Company

Adam Cove Helena DaSilva Hughes Jeff Glassman CEO Executive Director President Edson International Immigrant Assistance Center Damit! Inc.

Christopher Rezendes Doug Glassman Jim Oliveria Founder and President Owner Executive Director INEX Advisors SERVPRO of New Bedford MassHire Greater New Bedford Workforce Board

David Martin Quentin Ricciardi Amanda McMullen President CEO President and CEO HTP, Inc. Acorn Management New Bedford Whaling Museum

Scot Dubois Jennifer Downing David Cabral Co-Founder Executive Director Five Star Companies Pidalia Leadership SouthCoast Vice-Chair Greater NB Industrial Foundation Michael Tavares Robert Mitchell General Manager R.A. Mitchell Company Horatio's Inc.

cc:

Governor Charles D. Baker, Jr. Lt. Governor Karyn Polito Attorney General Maura Healey Senate President Karen Spilka House Speaker Robert A. DeLeo Senator Michael Barrett, Chair, Joint Committee on Telecommunications & Energy Senator Eric Lesser, Chair, Joint Comm. on Econ. Development & Emerging Tech. Senator Marc. Pacheco, Chair, Senate Committee on Global Warming & Climate Change Rep. Thomas Golden, Chair, Joint Committee on Telecommunications & Energy Rep. Ann-Margaret Ferrante, Chair, Joint Comm. on Econ. Development & Emerging Tech. Rep. Michael Finn, Chair, House Committee on Global Warming & Climate Change Secretary Mike Kennealy, Executive Office of Housing and Economic Development Commissioner Judith Judson, Department of Energy Resources Steve Pike, CEO, Massachusetts Clean Energy Center Mark D. Marini, Secretary, Department of Public Utilities 'IIie Commonwea{tfi of 9Vlassacliusetts 'EJ(flcutive Office of'Energy and'Environmenta{ ;4ffairs 100 Cam6ridge Street, Suite 900 (]3oston, :M;4 02114

Charles D. Baker GOVERNOR

Karyn E. Polito LIEUTENANT GOVERNOR Tel: (617) 626-1000 Matthew A. Beaton Fax: (617) 626-1081 SECRETARY http://www.mass.gov/eea

The Honorable Jon Mitchell March 27,2019 Mayor New Bedford

Dear Mayor Mitchell,

Thank you for your letter regarding offshore wind and the next solicitation for offshore vvind under section 83C of the Energy Diversity Act of2016.

The Baker-Polito Administration is focused on bringing cost-effective offshore wind development that provides benefits to Massachusetts ratepayers, supports compliance with our greenhouse gas goals, and fosters economic development opportunities associated with this new sector. It should be noted that consistent with the state law, the Administration will continue to seek long-term contracts that are cost-effective for ratepayers and every cent added to a 800 MegaWatt (MW) contract represents more than $30 million annually for all ratepayers in a 20- year contract. As vve conduct the procurements consistent vvith the authorizing statute, we also look to manage them in a manner that yields economic dividends, especially for regions of the state vvhere offshore wind development activity will be centered.

First, it should be noted that there vvere several key decisions in our procurement that have led Massachusetts to an enviable position nationally through its cost-effective offshore wind contracts. These provide economic opportunities for the Commonvvealth as a whole, but are also specifically oriented around the South Coast. For example, the electric distribution companies and the Department of Energy Resources conducted the most recent procurement on an accelerated time line to facilitate the utilization of the federal investment tax credit. This will facilitate lower capital costs for developers and provide companies with a greater margin for supply chain investments. It will also allovv the Commonwealth to make timely decisions regarding local supply-chain development. We have continued through the review at DPU to prioritize the time line of the offshore wind contracts to facilitate offshore vvind development in the Commonwealth. Second, Massachusetts has been working regionally to facilitate further deployment of offshore wind, which strengthens our first mover position. Rhode Island was able to select an offshore wind project based on our solicitation; this ultimately has led to an additional 700MW facility being selected between Connecticut and Rhode Island. This national leadership positions the northeast as a hub for offshore ·wind that will produce economic benefits across Massachusetts and southern New England.

Third, as a result of our procurement process and selection, Vineyard Wind has committed a $10 million fund through the Massachusetts Clean Energy Center (CEC) to support economic development of the offshore ·wind supply chain. The flexibility of the fund combined with the timing of. its deployment may ultimately provide a multiplier in attracting key investments. We look forward to your input on the use of the fund in the coming months.

Fourth, we were encouraged that Vineyard Wind signed a lease to use the Clean Energy Center's Nevv Bedford terminal, which the state invested more than $100 million to construct. Going forward, the Massachusetts Clean Energy Center's board continues to monitor improvements and repairs to the facility to ensure that it remains attractive to offshore wind developers.

Fifth, through its first offshore vvind workforce development grants, MassCEC anticipates investing approximately $400,000 to establish safety and technical training to internationally­ recognized standards for a broad range of·workers involved vvith staging and construction of Vineyard Wind's 800 MW offshore ·wind project, as vvell as future offshore vvind projects. The funding will also support specialized technical training in partnership vvith private industry for ·workers engaged in activities such as vvind turbine or povver cable installation. Muc_h of this offshore ·wind vvorkforce development is focused on the South Coast and in1he greater Nevv Bedford area. . · "~~~ .· ·

,, ·. r' Regarding your comments pertaining to the next solicitation, it foould be noted that the legislation authorizes the electric distribution companies to solicit cost-effective offshore vvind contracts though an RFP that is jointly developed by the Attorney General's Office, an independent evaluator, and the Department of Energy Resources. Per the statute, the electric distribution companies make the selection unless they fail to reach a consensus, in which ·case DOER vvill be responsible for selecting a cost-effecdve project. We are required to follow the statute in our execution of the RFP, its selection, qnd its approval. On January 4th, the Department of Energy Resources issued a series of comments to the public on the timing of the next solicitation. The response vvas overwhelmingly in favor of moving quickly to take advantage for the federal investment tax credit and supply-chain opportunities and have vvorked to include some of your suggestions, including an emphasis on economic opportunities in the qualitative portion of the evaluation, in the next solicitation.

Thank you again for your comments. The Commonvvealth is committed to continuing to vvork to identify and develop economic opportunities for offshore vvind.

Sincerely,

Matthew Beaton, Secretary The Commonvvealth of Massachusetts Executive Office of Energy & Environment