Avangrid Releases Kitty Hawk Wind Economic Impact Report

Rhea-AI Summary

Avangrid, Inc. announces the Kitty Hawk Wind project will generate $4.8 billion in economic impact in Virginia, creating over 12,000 jobs, with $1.2 billion in the City of Virginia Beach. The project aims to boost sustainable energy and local economies.

Positive

• The Kitty Hawk Wind project by Avangrid, Inc. is projected to generate $4.8 billion in economic impact in Virginia.
• Over 12,000 jobs will be created in the Commonwealth, with 9,500 located within Hampton Roads.
• The City of Virginia Beach is expected to benefit from $1.2 billion in economic impact.
• The project aims to boost sustainable energy initiatives and stimulate local economies.
• Property tax revenue for the City of Virginia Beach is estimated at $275 million.

Negative

• None.

Insights

Energy Sector Analyst

The projected $4.8 billion economic impact of the Kitty Hawk Wind project represents a significant infusion into the Virginia economy, particularly within the energy sector. This scale of investment typically correlates with enhanced infrastructure development, increased demand for local services and a boost in job creation. The energy sector is witnessing a shift towards renewable sources and large-scale projects like this one are pivotal in driving that transition. The creation of over 12,000 jobs can lead to a ripple effect, potentially increasing employment rates and consumer spending, which are critical indicators of economic health.

Furthermore, the estimated $1.2 billion benefit to the City of Virginia Beach indicates a substantial local impact. Property tax revenue projections, such as the $275 million for Virginia Beach, can lead to improved public services and infrastructure, thereby enhancing the quality of life for residents and potentially attracting further investment. The long-term benefits may include greater energy independence and sustainability, aligning with broader environmental goals and federal incentives for clean energy.

Environmental Economist

From an environmental economics perspective, the Kitty Hawk Wind project is an example of how renewable energy initiatives can align economic incentives with environmental stewardship. The shift towards offshore wind energy helps diversify the energy mix, reducing reliance on fossil fuels and associated greenhouse gas emissions. This transition is not only beneficial for the environment but also for the economy, as it can mitigate future costs associated with climate change impacts and health issues related to pollution.

The report's findings suggest that the project will generate significant economic benefits through job creation and tax revenue. However, it is also essential to consider the potential for indirect economic benefits, such as the development of a local supply chain for wind energy technology and the positive externalities associated with a cleaner environment. These factors contribute to a more comprehensive understanding of the project's total economic value.

Labor Market Analyst

The Kitty Hawk Wind project's potential to create more than 12,000 jobs is a noteworthy development in the labor market, particularly within Hampton Roads. This level of job creation in a single project can significantly reduce unemployment rates and provide a variety of employment opportunities, ranging from construction to long-term maintenance and operations of the wind facilities. The specialized nature of wind energy projects often requires a skilled workforce, which can lead to higher-than-average wages and contribute to overall economic prosperity.

It is important to analyze the types of jobs that will be created and the required skill sets, as this can influence local education and training programs. The longevity and stability of these jobs are also crucial factors. If the project leads to sustainable, long-term employment, it can have a profound impact on the community, potentially leading to increased economic stability and growth.

Assessment finds transformational offshore wind project will generate approximately $4.8 billion in economic impact in Virginia, $1.2 billion in City of Virginia Beach

Report estimates project will create more than 12,000 jobs in the Commonwealth; 9,500 located within Hampton Roads.

VIRGINIA BEACH, Va.--(BUSINESS WIRE)-- Avangrid, Inc. (NYSE: AGR), a leading sustainable energy company and member of the Iberdrola Group, today announced the release of a comprehensive economic assessment, the Kitty Hawk Wind: Economic & Fiscal Impact report. The report finds that the Kitty Hawk Wind project will deliver approximately $4.8 billion in economic impact across Virginia, including $1.2 billion in the City of Virginia Beach. As part of this larger economic benefit, the report calculates that the City of Virginia Beach, which would serve as the host community for the interconnection of the project to the power grid, would realize $275 million in property tax revenue, averaging about $7 million per year over 40 years, through the development, construction, and operation of the project. These new revenue streams can be used to support critical municipal services and investment in capital projects throughout the community.

“Kitty Hawk Wind is a transformational opportunity for Virginia and offers significant economic benefit to the City of Virginia Beach and the entire Hampton Roads region,” said Avangrid CEO Pedro Azagra. “As the developer of Vineyard Wind 1, the nation’s first large-scale offshore wind project, Avangrid is uniquely positioned to help the Commonwealth meet its energy goals, and looks forward to strengthening the bonds we’ve built in Virginia Beach and the Hampton Roads region. Through the development, construction, and operation of this project, Avangrid will be a committed partner to Virginia Beach, ensuring the city realizes the full economic benefit of Kitty Hawk Wind while helping Hampton Roads emerge as a regional hub for offshore wind.”

Kitty Hawk Wind is an offshore wind project proposed in federal waters more than 36 miles from Virginia Beach. Kitty Hawk Wind is expected to generate up to 3,500 Megawatts (MW) of clean, reliable electricity, enough to power more than 1 million homes and businesses each year and reduce greenhouse gas emissions by more than 1.5 million metric tons – equivalent of taking 500,000 cars off the road annually.

Through development, construction, and operations, the report estimates that Kitty Hawk Wind will deliver approximately $4 billion in investment to the Hampton Roads region, which is uniquely positioned to provide critical services to offshore wind due to its existing port infrastructure and maritime workforce. The report estimates the project will create more than 12,000 jobs in the Commonwealth, 9,500 of which would be located within Hampton Roads.

“Our support of offshore wind energy is the biggest opportunity we have in Virginia Beach to be a leader in providing an alternative to fossil fuels for energy generation and doing our part to reduce the greenhouse gas emissions that are fueling climate change,” said Lynnhaven River NOW Executive Director Karen Forget. “In addition to contributing to lowering the emission of climate altering greenhouse gases, offshore wind energy is the most important growth industry in our regional economic forecast.”

“Energy supply in the region is critical to maintaining and growing the economy,” said Hampton Roads Chamber CEO and President Bryan Stephens. “The Kitty Hawk Wind Project has the potential to supply our growing energy needs, provide new tax revenue to the City of Virginia Beach, and help the state meet the clean energy goals of 100 percent renewable electricity supply by 2045.”

“The Hampton Roads Workforce Council is working with our local training providers to ensure that we have the workers ready to meet the diverse needs of our offshore wind industry,” said Hampton Roads Workforce Council CEO Shawn Avery. “The training we are doing now will support the Kitty Hawk Wind project as well as future projects, strengthening the talent pipeline for these exciting career opportunities – not only today, but for generations to come.”

“Since 2009, the VMA has consistently touted the opportunities offshore wind presents to expand and diversify our maritime economy. The Kitty Hawk Wind Economic Report affirms the economic benefits of that project alone, and specifically the financial windfalls for the citizens of Virginia Beach,” said Virginia Maritime Association Executive Director David White. “The opportunity presented by the Kitty Hawk Wind project for our industry and the community must not be allowed to slip away.”

Kitty Hawk Wind will also advance the Commonwealth’s transition to a clean energy future by utilizing the reliable and abundant wind resources off its coast to power homes and businesses, increasing energy security, and reducing dependence on fossil fuels. The project would also ensure that Virginia meets its legally mandated target of 5.2 GW of offshore wind by 2034.

Avangrid is developing the nation’s first large-scale offshore wind project, the 806-megawatt Vineyard Wind 1, located 15 miles off the coast of Martha’s Vineyard. Currently under construction, Vineyard Wind will generate electricity for more than 400,000 homes and businesses in the Commonwealth of Massachusetts, create 3,600 Full Time Equivalent (FTE) job years, save customers $1.4 billion over the first 20 years of operation, and is expected to reduce carbon emissions by more than 1.6 million metric tons per year, the equivalent of taking 325,000 cars off the road annually.

In February 2024, Avangrid announced that it has powered up the first five GE Haliade-X turbines for the nation-leading Vineyard Wind 1 project, delivering clean energy to 30,000 homes and businesses in Massachusetts. Vineyard Wind 1, the first large-scale offshore wind project in the United States, is currently providing approximately 68 Megawatts to the New England grid, delivering a steady stream of clean energy that will help the region meet winter electricity demand.

Vineyard Wind began offshore construction in late 2022, achieved steel-in-the-water in June, and completed the nation’s first offshore substation in July. In December 2023, Avangrid announced that Vineyard Wind 1 has created 2000 jobs in Massachusetts to date.

Avangrid is committed to responsible development, minimizing impacts to Virginia Beach residents, businesses, and visitors during construction, as well as ensuring local communities benefit from the transformational investments made to build a diverse, equitable, and inclusive offshore wind sector. Kitty Hawk Wind has established a local office in Town Center, Virginia Beach to support ongoing project development, community outreach, and workforce development activities. The Kitty Hawk Wind: Economic & Fiscal Impact report was prepared by Chmura Economics & Analytics, a top labor market data and analysis software consultant based in Richmond, VA.

About Avangrid: Avangrid, Inc. (NYSE: AGR) aspires to be the leading sustainable energy company in the United States. Headquartered in Orange, CT with approximately $44 billion in assets and operations in 24 U.S. states, Avangrid has two primary lines of business: networks and renewables. Through its networks business, Avangrid owns and operates eight electric and natural gas utilities, serving more than 3.3 million customers in New York and New England. Through its renewables business, Avangrid owns and operates a portfolio of renewable energy generation facilities across the United States. Avangrid employs approximately 8,000 people and has been recognized by JUST Capital in 2021, 2022, 2023 and 2024 as one of the JUST 100 companies – a ranking of America’s best corporate citizens. In 2024, Avangrid ranked first among utilities and 12 overall. The company supports the U.N.’s Sustainable Development Goals and was named among the World’s Most Ethical Companies in 2024 for the sixth consecutive year by the Ethisphere Institute. Avangrid is a member of the group of companies controlled by Iberdrola, S.A. For more information, visit www.avangrid.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240307569827/en/

Media Contacts:

Rachel Martin, Outreach Manager

Rachel.martin@avangrid.com

(774) 437-3979

Sarah Warren, Manager, National Communications

Sarah.warren@avangrid.com

(585) 794-9253

Source: AVANGRID

FAQ

How much economic impact is expected from the Kitty Hawk Wind project in Virginia?

The Kitty Hawk Wind project is estimated to generate approximately $4.8 billion in economic impact in Virginia.

How many jobs will be created by the Kitty Hawk Wind project in the Commonwealth?

The project is expected to create more than 12,000 jobs in the Commonwealth, with 9,500 located within Hampton Roads.

What is the projected economic impact in the City of Virginia Beach from the Kitty Hawk Wind project?

The City of Virginia Beach is expected to benefit from $1.2 billion in economic impact from the Kitty Hawk Wind project.

How much property tax revenue is estimated for the City of Virginia Beach due to the Kitty Hawk Wind project?

The City of Virginia Beach is estimated to receive $275 million in property tax revenue from the Kitty Hawk Wind project.

Who announced the Kitty Hawk Wind project?

Avangrid, Inc. announced the Kitty Hawk Wind project.