NEW LONDON — On Friday, the Connecticut Port Authority missed its extended contractual deadline to have federal permits in hand for the redevelopment of State Pier in New London.
A clause in the agreement between the port authority and the offshore wind partnership of Eversource and Ørsted allows the companies to pull back a portion of their $75 million contribution to the $235 million redevelopment project, if permits from the U.S. Army Corps of Engineers are delayed.
Justin May, spokesman for the partnership, said there are no ongoing negotiations between Ørsted – Eversource and the state that would be affected by the missed deadlines.
The port authority and energy partners agreed to the Oct. 15 timeline, allowing more time for a lengthy Army Corps environmental review, after the project missed an earlier Aug. 31 deadline.
That review is ongoing, with no clear timetable for completion, placing the two sides yet again in the situation of meeting to decide on a further extended deadline.
Port authority spokesman Andrew Lavigne said the quasi-public would be meeting with the Ørsted-Eversource partnership and port operator Gateway to either revise the deadlines or the underlying agreement. In the meantime, he said the authority would continue with the work that has already been permitted, including constructing a bulkhead and heavy-lift pad.
“We will be meeting with our partners regularly with the goal of identifying a mutually agreeable timeline as soon as possible,” Lavigne said. “The authority and our partners remain committed to developing a plan to deliver the project in its full scope. Altered scope has not been discussed in our meetings.”
According to Lavigne, the process of setting and extending deadlines is useful for planning, and allows the parties to plan related items, or items contingent on the permits.
With the second deadline having passed, the Ørsted-Eversource partnership can again withdraw whatever remains of its $55 million contribution held in escrow. According to Lavigne, there isn’t an exact calculation for how much the companies could withdraw given the complexity of the process.
In the “rare scenario” where the project doesn’t move forward at full scope – meaning it is scaled down – the companies would need to make “diligent” efforts to revise the deadline, according to Lavigne. Failing a consensus on that, they would need to try to revise the construction schedule, cost estimate or funding plan, he said. If all those discussions failed, they could start the withdrawal process – but more of their money would be used for demobilizing the project and terminating the agreements, Lavigne said.
The partnership has not publicly indicated any desire to withdraw that money, a move that would leave a sizeable funding gap for a project that is meant to provide a staging area for the construction of Revolution Wind – a 704 MW wind farm Ørsted-Eversource plan to build off the coast of Rhode Island.
“Ørsted and Eversource are Connecticut’s partners in addressing climate change, supporting economic development and job creation through offshore wind and the State Pier redevelopment project,” May said. “With the agreed upon federal permit deadline having passed, we will be meeting with the Connecticut Port Authority and Gateway Terminal to assess the impact, if any, on the overall project schedule. We remain excited about the transformation of State Pier and its benefits to Connecticut.”
At a Connecticut Port Authority Board meeting on Tuesday, Board Chair David Kooris said they were originally “pretty optimistic” that the permit would be approved in spring 2021. That was delayed because a permit from the Connecticut Department of Energy and Environmental Protection came later than expected, Kooris said. He said there is a list of outstanding questions that need to be resolved for the Army Corps to approve the permit, and that the Port Authority is continuing to resolve them.
“I don’t want to say it’s imminent, but it definitely feels soon,” Kooris said. “We do have increasing visibility on the aspects that remain unresolved, and that list is getting shorter and shorter.”
Kooris said he was still confident they can deliver the project on schedule, but that the final cost — to date $235 million has been approved — would still depend on when the permit is issued and what effect that would have on the project timeline.
“Based on the information we have today, we are on or near budget,” Kooris said.