Offshore wind developer Ørsted will invest $70 million to open a steel fabrication center with an Eastern Shore company to serve its mid-Atlantic projects.
The developer announced the agreement Thursday at Crystal Steel Fabricators in Federalsburg where the new offshore wind fabrication center will be constructed. The investment includes $67 million to purchase steel components and $3 million for a 25,000-square-foot expansion of Crystal Steel's facility.
As a result, Crystal Steel will increase its workforce in Federalsburg by nearly a third, hiring up to 50 new local welders, fitters, CNC machine operators, painters, truck drivers and more. Workers at the new center will supply steel components that will be used to construct wind turbine foundations for at least three of Ørsted's offshore wind projects, including one in Maryland and two in New Jersey.
“I like the fact that we’re going to be making things for New Jersey here as well, not just for Maryland," said Gov. Larry Hogan at the announcement. "We want to do it for every state up and down the East Coast and make them right here in Maryland.”
Ørsted is the developer behind the 120-megawatt Skipjack Wind project, one of two offshore wind farms planned for off the coast of Ocean City and approved by the Maryland Public Service Commission (PSC) in 2017 during the state's first offshore wind solicitation. The other, the 270-megawatt MarWin project, is being constructed by US Wind.
Workers at Crystal Steel will manufacture massive steel components — some as tall as 45 feet and weighing between 9 and 16 tons each — to be used in the foundations of offshore wind turbines. Components fabricated at Crystal Steel will then be taken to Tradepoint Atlantic in Baltimore County where Ørsted is constructing Maryland's first offshore wind staging center where turbine parts will be stored and assembled.
Buildout of the 50-acre staging center is the next step in Ørsted's $13.2 million investment at Tradepoint Atlantic, which also included port infrastructure upgrades.
Earlier this month, Ørsted also announced plans to construct the state's first emissions-free offshore wind operations and maintenance facility in west Ocean City. The facility will create 110 jobs, generate $25 million in local investment and serve as a home for wind turbine maintenance technicians, engineers, operations personnel and more.
The commitments also follow on a $400 million investment proposal from Ørsted that includes the construction of a $140 million cable manufacturing factory at Tradepoint Atlantic. Most of that investment is tied to the developer's bid to construct a second offshore wind farm off the coast of Maryland, a 760-megawatt project called Skipjack Wind 2, which is contingent on PSC approval.
Ørsted is competing with US Wind in the state's current offshore wind solicitation for all or some of the available 1,200 megawatts of offshore wind renewable energy credits (ORECs), which were added as part of the Clean Energy Jobs Act of 2019.
US Wind in August announced its own proposal for a two-phase development, Momentum Wind, totaling 1,200 megawatts. The bid also includes $150 million to construct a steel fabrication facility at Tradepoint Atlantic that would bring 500 permanent manufacturing jobs to the site. US Wind's proposal is also contingent on the total ORECs awarded by the PSC.
The developers' bids have been submitted as part of the first of three application rounds for the state's second offshore wind solicitation. The PSC has the power to approve all or part of the 1,200 megawatts to one, both or neither of the developers in the first, second or third round — with some limitations related to cost impacts to ratepayers. The commission must issue its decision on the first application round on or before December 18.
Notably, the Crystal Steel fabrication center "is not conditioned on a potential future project award," Ørsted said in a statement, adding it is part of a larger plan to develop a long-term supply chain that will support the growth of the country's fledgling offshore wind industry.
“Maryland’s Eastern Shore is an outstanding location for expanding offshore wind’s domestic supply chain,” said David Hardy, CEO of Ørsted Offshore North America. “For decades, offshore wind steel fabrication jobs were located overseas, so we are particularly excited to bring these sustainable, good-paying jobs here to America as part of our buildout of a new 21st-century American industry."
