Congress Overrides Trump’s Veto, Enacting Maritime Priorities in NDAA

MARITIME EXECUTIVE

The U.S. Senate voted Friday to override President Donald Trump’s veto of the National Defense Authorization Act (NDAA) for FY2021, joining the House to continue an unbroken 60-year tradition of passing an annual military policy bill. In addition to servicemember pay, weapons procurement and other defense-related measures, the package contains countless legislative amendments on parallel matters – including high-priority questions for the American maritime industry, like financial relief for U.S. seaports, new rules for passenger vessel safety, and new language that applies federal offshore energy regulations (and the Jones Act) to offshore wind farms.

The NDAA contains language that ensures that offshore wind farms count as U.S. points for purposes of federal law, just like offshore oil and gas facilities. This provides certainty that foreign-flag vessels cannot be used to carry goods between U.S. ports and wind projects on the U.S. outer continental shelf.

According to the American Maritime Partnership, the NDAA also clarifies the terms and procedures that apply when an emergency administrative Jones Act waiver can be issued. In particular, a national defense waiver must be tied to a legitimate national defense need; non-defense waivers are now time-limited; and all waivers are subject to public reporting requirements whenever they are used.

“As we end this most challenging year, we are encouraged by Congress’s recognition of the contributions American Maritime makes to our security and to a healthy and resilient American economy,” said Michael Roberts, President of the American Maritime Partnership. “We are also grateful for the tangible progress made in this bill to reinforce the requirement that those who do work in our home waters must hire American workers and obey American laws. We look forward to building on that progress in the next Congress.”

The now-enacted law also creates a new Maritime Transportation System Emergency Relief Program (MTSERP) to provide funding to ports after natural disasters and emergencies, including the COVID-19 pandemic. It also raises the authorized funding level for the Port Infrastructure Development Program (PIDP) to $750 million annually, up from $500 million.

The NDAA also requires the Government Accountability Office to conduct an audit of federal agencies’ compliance with long-ignored cargo preference laws, which require government-owned and government-financed cargoes to ship aboard U.S.-flagged vessels. The audit will examine the degree of agency staff and contractor compliance, along with the past levels of enforcement effort by the Maritime Administration.

The NDAA also provides coastwise trade endorsements for three specific vessels that might not otherwise qualify. These include the St. Kitts-flagged cruise ship Safari Voyager; the formerly Russian-flagged expedition yacht Pacific Provider; and the Canadian-built tall ship Oliver Hazard Perry.

US election: how has Donald Trump impacted the maritime industry?

Ship Technology
by Adele Berti

The US is currently bracing for one of the most divisive presidential elections in its history, with Donald Trump and Joe Biden preparing to hit the polls on Tuesday.

As the pair approach the end of their race to the White House, maritime stakeholders have a tough decision to make ahead of them. The sector has seen a dramatic drop in traffic and economic activity since the start of the Covid-19 pandemic and is in dire need of financial support and reforms.

According to Cozen O’Connor attorney Jeff Vogel, President Trump has implemented a “mixed bag” of positive and negative initiatives for US maritime since 2016, supporting development in some areas while significantly limiting others.

A Washington-based law firm specialised in maritime matters, the Cozen O’Connor Maritime practice group has been closely following the Trump administration’s work on the industry for the past four years. With just a few days left until the voting closes, Vogel comments on President Trump’s contributions to the sector during his current mandate.

Driving change in port development and shipbuilding

Under the work of Secretary of Transportation Elaine Chao, many US ports have benefitted from increased funding, courtesy of initiatives such as the Port Infrastructure Development Program. Established earlier this year, the scheme aims to support improvements to port facilities and freight infrastructure with grants rolled out in February and October 2020.

Recipients of the grants include some of the most high-profile hubs in the country, such as Anchorage in Alaska, Los Angeles in California and Cape Canaveral in Florida. “This infrastructure investment hasn’t been in the trillions of dollars as was indicated during [Trump’s] 2016 campaign but this has been a very successful programme by Secretary Chao,” comments Vogel.

Beyond port development, another area that saw increased funding during the current administration is the shipbuilding sector. Specifically, Vogel says, President Trump authorised funding of the National Security Multi Mission Vessels, a set of training vessels that will be used by state maritime academies and then can be deployed in humanitarian aid and disaster relief operations.

“That total contract has been awarded to Philly Shipyard in Philadelphia and is in the range of about $1.5bn,” he explains. “This represents significant investment in terms of the commercial side investment in shipbuilding.”

International profile: the heavy toll of the China trade war

From an international point of view, nothing has raised more eyebrows than the ongoing trade war between the US and China. The most significant trade-restricting measure in the world, this protectionist policy has been in place since March 2018 and looks likely to remain in place were Trump to succeed on Tuesday.

“[Recent terrorist attacks] have had an impact on the industry and we’ve certainly seen that in a number of sailing cancellations in the Pacific trade,” comments Vogel. “That has impacted both US-flagged and non-US flagged operations as China was a significant trade partner of the US. These tariffs, the chilling effect of ongoing negotiations and the continuing standoff between the White House and China have certainly impacted trade in the Pacific.”

Adding to these tensions is a recent fall-off in US-flagged preference cargoes. Under the Cargo Preference Act of 1954, about 50% of Civilian Agencies cargo and Agricultural Cargo needs to be carried on US-flagged vessels.

However, Vogel explains that a recent drop in the available cargo is having a negative ripple effect on the programmes that depend on it, such as the Food for Peace scheme. “This is where agencies like the US Agency for International Development purchase food commodities from US farmers and ship them overseas in support of humanitarian aid disaster relief operations,” he adds. “Those programmes are reviewed each year, and over time they have been zeroed out in the President’s programme.”

Despite recent attempts to restore funding for the programmes, the ongoing Covid-19 pandemic has diverted the focus away from them, putting more emphasis on national development projects.

The Jones Act and its role within offshore wind development

Having just marked 100 years since its establishment, the Jones Act is one of the most controversial laws in US maritime, one that the Trump administration has so far failed to take a stance on.

A section of the 1920 Merchant Marine Act, the Jones Act is one of the world’s strictest cabotage laws at it only allows US-flagged and built ships to move goods between national ports. It also states that vessels must be registered in the US with 75% of crew formed by US citizens.

“What we saw early on in the administration was mixed messages, though mainly leaning towards not supporting the Jones Act,” says Vogel. “There was a long period of conversations about providing a full waiver of the Jones Act for trade between the continental US and Puerto Rico, [as well as] waivers for liquefied natural gas (LNG) going into New England.”

But under pressures from industry stakeholders, these waivers never eventually came to fruition. “The net result is that there were a few limited waivers that were granted as responses to hurricanes that hit the US, [consistently] with what we’ve seen in past administrations,” he adds.

Despite failing to drive change in this field, the Trump administration still managed to indirectly affect some of the areas the Jones Act focuses on, such as offshore wind development.

“There are a number of questions regarding the application of the Jones Act to offshore wind development,” says Vogel. “The administration has not taken any steps to clarify those issues.”

However, this has not stopped companies like Danish power supplier Ørsted from continuing their wind development projects. “Things have not gone as quickly as stakeholders would have liked in large part because it’s not a policy priority of the current administration,” Vogel explains.

Reducing carbon emissions in maritime

The past few years have seen increasing pressures on the global maritime industry to reduce its carbon emissions, driven primarily by the International Maritime Organization. According to Vogel, this is an area where the US has achieved progress despite President Trump’s much-debated decision to withdraw from the 2015 Paris Agreement.

“[Withdrawing from] the Paris Accord speaks for itself as to the administration’s priorities for emission control but, notwithstanding that sort of policy change, a number of Jones Act operators have already made significant investments into cleaner forms of propulsion for their vessels,” he comments. “Operators such as Tote Maritime and Crowley Maritime that are operating in the Jacksonville to Puerto Rico trade route have made significant investments in dual-fuel vessels over the past seven/eight years.”

Many shipowners and operators are also investing in increasing their capacity for LNG-powered vessels running between Florida and Puerto Rico through private funding.

“Another area that we’ve seen move forward – despite not being a White House priority – is the control of invasive species through ballast control systems,” he concludes. These initiatives started before the current administration, though their successes have convinced the US Coast Guard and Environmental Protection Agency to approve new systems that are currently being implemented to reduce the environmental impact of ballast water discharge.

NSW gets world’s toughest wind farm rules

PEOPLE living within two kilometres of proposed wind farms will have the right to veto them, under a NSW government proposal.

Planning and Infrastructure Minister Brad Hazzard says NSW remains committed to being part of the Federal Government’s 20 per cent renewable energy target by 2020, despite proposing what he has described as the world’s toughest wind-farm guidelines.

Under the proposal, a company wanting to set up a wind farm in an area where landowner consent has not been given will have to go to an independent regional planning panel if there is community opposition. ”That means 100 per cent of neighbours have to be happy within that two-kilometre zone,” Mr Hazzard told reporters in Sydney.

Mr Hazzard said he hoped the idea would find a balance between residents living near wind turbines and supporters of renewable energy.

”Today I am announcing that the NSW coalition government is putting out for public discussion some of the toughest wind-farm guidelines in the country, possibly the world,” he said.

The Victorian coalition government this year gave residents within a two-kilometre radius a right of veto over wind turbines.

But Mr Hazzard said the NSW proposal was different to Victoria’s and that wind-farm proponents would get a bigger say.

Planning panel approves Auwahi wind farm

WAILUKU – The Maui Planning Commission unanimously approved permits Tuesday for Auwahi Wind Energy to build and operate eight 428-foot-tall wind turbines on Ulupalakua Ranch land.

Two dozen people testified on the proposed special use and special management area permits, and none were opposed to the project, according to planner Ann Cua. Some testifiers shared concerns about traffic, safety and visual impacts of the wind farm.

The project would have the capacity to generate 21 megawatts, which would be enough power to supply electricity to 10,000 homes. The $140 million project’s infrastructure includes an energy storage system; a 9-mile, 34.5-kilovolt power line; an interconnection substation; a microwave communication tower; and a construction access road. Each generator pad would require about 2.4 acres of cleared area, while the entire project would cover 1,466 acres, almost entirely on Ulupalakua Ranch land.

The project aims to provide power for Maui island only. It is not part of the “Big Wind” project, which calls for wind farms on Lanai and Molokai to provide power to Oahu via an underwater cable.

Commission members attached conditions to Auwahi’s permits, including one that requires Auwahi Wind, a division of Sempra, to work with the state Department of Hawaiian Home Lands and Ka Ohana O Kahikinui Inc. to develop a community benefits package. The groups would develop a plan and sign a memorandum of agreement addressing the roadway improvement and other needs of the Kahikinui homestead community.

The project area contains more than 1,100 archaeological features on 174 sites, and the developer has designed the turbines and power lines to avoid culturally sensitive burials and heiau.

Wind farm paid £1.2 million to produce no electricity

A wind farm has been paid £1.2 million not to produce electricity for eight-and-a-half hours.

By Edward Malnick and Robert Mendick

9:00PM BST 17 Sep 2011

Comments102 Comments

The amount is ten times greater than the wind farm’s owners would have received had they actually generated any electricity.

The disclosure exposes the bizarre workings of Britain’s electricity supply, prompting calls last night for an official investigation into the payments system.

The £1.2 million will go to a Norwegian company which owns 60 turbines in the Scottish Borders.

The National Grid asked the company, Fred Olsen Renewables, to shut down its Crystal Rig II wind farm last Saturday for a little over eight hours amid fears the electricity network would become overloaded.

The problem was caused by high winds buffeting the country in the wake of Hurricane Katia.

In total, 11 wind farms were closed down last week, receiving a total of £2.6 million. The money – detailed in calculations provided by National Grid – will be added on to household bills and paid for by consumers.

As Britain pushes for more and more wind farms, critics claim the size of the ‘constraint payments’ will grow accordingly – raising serious concern about the long-term suitability of wind power to meet Britain’s energy needs.

Crystal Rig received by far the largest single payment because the National Grid runs an auction, inviting energy companies to say how much they want in compensation for switching off.

Crystal Rig’s owners asked for £999 per megawatt hour of energy they would have produced had they been switched on. Incredibly, the figure Crystal Rig had bid was accepted by the National Grid.

Wind farms under fire for bird kills

Six birds found dead recently in Southern California’s Tehachapi Mountains were majestic golden eagles. But some bird watchers say that in an area where dozens of wind turbines slice the air they were also sitting ducks.

The U.S. Fish and Wildlife Service is investigating to determine what killed the big raptors, and declined to divulge the conditions of the remains. But the likely cause of death is no mystery to wildlife biologists who say they were probably clipped by the blades of some of the 80 wind turbines at the three-year-old Pine Tree Wind Farm Project, operated by the Los Angeles Department of Water and Power.

As the Obama administration pushes to develop enough wind power to provide 20 percent of America’s energy by 2030, some bird advocates worry that the grim discovery of the eagles this month will be a far more common occurrence.

Windmills kill nearly half a million birds a year, according to a Fish and Wildlife estimate. The American Bird Conservancy projected that the number could more than double in 20 years if the administration realizes its goal for wind power.

County, Life of the Land to intervene in wind case

The Public Utilities Commission has allowed Maui County and the organization Life of the Land to become intervenors in Hawaiian Electric Co.’s proposal to charge customers for a $4 million study on “Big Wind.”

Henry Curtis of Life of the Land said customers should not be forced to finance the studies, because past rulings by the PUC clearly ordered HECO to evaluate alternatives to the massive wind-power project. The commission’s decision and order, which was signed Wednesday, said HECO’s review of the project should have also evaluated alternatives such as expanding residential or large-scale photovoltaic systems, biomass, biofuel and concentrated solar energy.

But although they granted the interventions, the commission also cautioned Life of the Land and the county that their involvement would be limited to the issues currently on the table.

“The commission will preclude any effort by them to unreasonably broaden the issues,” the decision stated.

It then inserted a curious and unusual note that the commissioners said they expect the intervenors “will comply with the commission’s rules and orders.”

County Energy Coordinator Doug McLeod said the language was “interesting,” but he believes there will be some latitude “in what we can legitimately discuss.”

The county’s principal concern from the start, he said, has been “the lack of community benefits from Big Wind.”

Viewpoint: Big Wind project clarifications offered

The June 14 article about Maui County’s powerful letter to the Public Utilities Commission – and the county’s decision to intervene in Hawaiian Electric Co.’s request to be reimbursed by ratepayers to the tune of $4 million – contained a number of inaccuracies.

The article identifies two organizations that were denied intervention by the PUC: Life of the Land and Lanaians for Sensible Growth. That is incorrect. The two parties denied intervener status were Friends of Lana’i and Life of the Land.

The article states that the Big Wind project will likely have an enormous impact on Lanai and possibly Molokai. True enough, but one look at the state’s project maps (www.hirep-wind.com/documents/EISPN_PROJECT_AREA_22NOV2010.pdf) confirms for all Maui residents that the state plans to run a cable to/from Maui as well. And First Wind Hawaii, the developer that was unsuccessful in its attempt to develop a wind power plant on Molokai, stated in an April 26 Pacific Business News article that it has now turned its sights to Maui, suggesting that “Maui be included in the interisland cable project.”

The June 14 article’s comments about the deal struck between Castle & Cooke and Pattern Energy also requires clarification

Big Wind must be transparent – Hawaii Editorials

Wind energy is cited among the green alternatives to fossil fuel, but environmental and community groups are irritated about the handling of a massive project to transmit energy to Oahu from windmills on Lanai and Molokai. They should be provided more access to preliminary work on the plan by state agencies and Hawaiian Electric Co., and hold project members to promises of full access and participation at future venues.

HECO is seeking a “power purchase agreement” from the Public Utilities Commission to recover $4 million from ratepayers in costs for studies associated with the Big Wind, or Interisland Wind, project. The PUC has endorsed the Hawaii Clean Energy Initiative, which mandates that 40 percent of the state’s energy come from renewable sources by 2030, so the studies are consistent with the state’s goals. The path to getting there, though, has the potential to keep lay people in the dark until it emerges as a fait accompli.

Even Maui Mayor Alan Arakawa is complaining that “no one can tell us where the cable will run, its overall cost or how it would interconnect with the grids on the islands of Maui, Molokai and Lanai.… We need a clear, complete, accurate, detailed analysis for the cable system before we agree to finance it on the backs of the ratepayers.”