Maloney asks about SBMT status and jobs; Jung explains jurisdiction and lease protections
Maloney echoes the need for revised numbers, then asks about SBMT construction status and jobs created. Jung explains the federal, state, and local government roles in offshore wind, confirms SBMT is 98% complete, and details lease protections including a construction guarantee, lease guarantee through 2054, a $20 million penalty clause, and reimbursement-based city capital.
Thank you, Chair Wan.
Echoing the sentiment, the original report had four growth drivers that have considerably shifted since the original.
Report was published, public policy and targets, citing state and federal laws, government spending and incentives, primarily citing federal funding that was directed towards
the green economy, and then consumer preferences, which have also probably shifted in an increasingly
in an affordability crisis.
So echo Chair Wan's sentiment of needing to revise the numbers to be more realistic when the Center for the Urban Future was citing that there's been 2,000 net new green jobs in
2023 and that delta of things for
asking that line of questioning.
I wanted to
Jump over to the South Brooklyn Marine Terminal and ask what the status is of the current construction at the terminal, how many jobs have been created there.
Happy to do so.
I think the top lines that I'll say about SBMT and Empire Wind 1 and the future pipelines include, one, the city's interests are protected at the South Brooklyn Marine Terminal.
Empire Wind 1 has faced federal obstruction, but is unlikely to face them in the future.
And then three, the future pipeline of new offshore wind projects is challenged.
For context there, I'll just briefly go over the different roles that each level of government play with an offshore wind first.
At the federal level, they are responsible for giving site control to offshore wind developers in what they call wind lease areas in federal waters, and also to permit the offshore construction.
So Empire Wind 1 as an offshore wind project is subject to federal jurisdiction in that regard.
New York State in particular creates a market for offshore wind.
They solicit and procure for offshore wind renewable energy credits, which enable offshore wind developers to get the financing that they need to finance the overall onshore and offshore projects.
The local government provides site and infrastructure to different onshore components of the offshore wind farm.
which includes the South Brooklyn Marine Terminal.
So you just wanted to get that clear from the start.
At the South Brooklyn Marine Terminal, like I mentioned before, it's 98% complete.
Just to speak to the ways in which we protected the city's interest through the lease there, we had a construction guarantee, first and foremost.
We wanted to ensure that if there was going to be federal obstruction, that Equinor and Skanska don't walk away from the project and that we as a city are made whole with a complete
world-class Osher Windport, which we are on track to be completed very soon.
We also have a lease guarantee through the term of Equinor's sublease, which is from 2026 to 2054.
So they ultimately are on the hook for rent payments to the city.
And there is a $20 million penalty if they renege on their lease.
And then we have invested into South Brooklyn Marine Terminal with our city capital.
That, as you probably know, is reimbursement-based.
And so we will not pay out those resources until the work is completed, given that they, as Equinor, have to pay out of pocket first, and then we will repay once that is.
completed.