SOUTH KINGSTOWN – Could a formula be the key to solving disputes over how much major wind farm developers owe to local fishermen?
After a contentious and prolonged negotiation period over the South Fork Wind Farm that ultimately failed to reach a compromise, Rhode Island coastal regulators are considering how a standardized process could make agreements easier in the future.
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That includes the 700-megawatt Revolution Wind project, which is next on the agenda of federal wind farm projects that the R.I. Coastal Resources Management Council gets a say in through its Ocean Special Area Management Plan.
Jeff Willis, CRMC executive director, said in an email that the agency is “implementing changes in our review of information and issues for wind farm projects moving forward to achieve more positive outcomes.” They can suggest, but not force developers to use a standard formula to estimate the value of the fishing industry and how much they should be paid to offset losses from wind farm projects, Willis said.
Meaghan Wims, a spokesperson for Orsted A/S, the co-developer of Revolution Wind as well as South Fork, among other projects, declined to comment on whether the company would consider such a standard for Revolution or other future projects. The company does not comment on hypotheticals, she said.
Local fishermen, on the other hand, were interested, but wary of the proposal.
Marisa Desautel, an attorney who represented the Fisherman’s Advisory Board during South Fork negotiations, said the group was open to a formulaic approach to avoid what they considered a raw deal with South Fork.
But, she added, “the devil is in the details.”
Details such as what sources of data are used to estimate the value, and losses, the fishing industry will incur from a project.
Jim Boyd, deputy director for the CRMC, in a previous meeting suggested following the methodology for the Vineyard Wind project agreement.
Documentation from those agreements details calculations based upon data collected from the U.S. Bureau of Ocean Energy Management, the National Oceanic and Atmospheric Association and the R.I. Department of Environmental Management.
But Tom Sproul, a University of Rhode Island economist who served as a private consultant to the fishermen’s board for both South Fork and Vineyard Wind, said these data sources, particularly NOAA, don’t reflect the true value of industry activity. NOAA, for example, uses a model that calculates the number of vessel trips across a certain area of the ocean. Not only are different areas more fruitful for fishing than others – Cox Ledge where South Fork is to be built, for example, is uniquely rich in a diversity of fish – but it also fails to consider certain subsectors of the industry. Lobster and Jonah crab fishermen, for example, aren’t required to log their vessel trips.
“Frameworks are nice in one sense, but they are also really challenging because people don’t agree on the sources they are derived from,” Sproul said.
Fred Mattera, executive director for the Commercial Fisheries Center of Rhode Island, also faulted NOAA data for failing to capture the extent and breadth of the industry.
“We as an industry need to do a better job of identifying where we fish and depositing these things into some sort of knowledge trust,” he said.
Not only was the data flawed, in Sproul’s view, but the way it was applied to determine compensation didn’t pass economic muster.
“It was kind of cobbled together to justify the number rather than the other way around,” he said.
Still, the $16.7 million package Rhode Island fisherman will receive from Vineyard Wind – $4.2 million in direct compensation plus $12.5 million to be put in a trust managed by local fishermen – is significantly higher than the $5.2 million payout approved for South Fork.
Mattera called the South Fork number “humiliating,” though he added Vineyard Wind’s compensation also seemed low.
The trust fund created in Vineyard Wind is also important because it gives control of funding distribution to those in the industry, via an appointed nonprofit board.
“You’ve got an industry that has been doing this for generations” Desautel said, “It makes sense for them to come up with this trust board that makes decisions on who gets compensation.”
The South Fork fund, in contrast, will be controlled by a third-party administrator.
Both agreements call for all or most of the funding to be paid upfront, which Desautel and Sproul stressed as important since the construction of the wind turbines creates the biggest disruptions to the industry.
Meanwhile, Richard Fuka, a squid fisherman and president of the Rhode Island Fishermen’s Alliance, said whether future compensation deals were standardized on any formula was “irrelevant,” claiming the entire process was controlled by politics and inherently favored toward developers.
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
