Examining the market and regulatory dynamics behind the Coastal Virginia Offshore Wind project

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Virginia Tech


The Coastal Virginia Offshore Wind (CVOW) pilot project will be only the second operating offshore wind project in the United States when it enters service later this year. This gives Virginia, a state criticized for a weak regulatory environment and environmental policy that has been slow to embrace renewable energy, an opportunity to take a leadership position in the development of this zero-carbon resource. One explanation for the CVOW project's emergence is the Diffusion of Innovation Theory (DIT), which relates the rate of adoption of novel solutions to factors such as relative advantage, compatibility, complexity, trialability and observability – all factors which play, to varying degrees, in favor of this project. Another explanation involves an inversion of Regulatory Capture Theory (RCT). RCT posits that regulated industries capture otherwise neutral regulating bodies, to the detriment of the generic public interest. Others argue that RCT underplays the degree to which regulators prioritize the interests of the regulated community over the public interest, defending a Climate of Capitulation Theory (CCT). While Virginia has recently taken an aggressively pro-wind policy position as it competes with other states to serve as a hub for the offshore wind industry and responds to voter interests in sustainability, the CVOW project problematizes RCT. It also suggests that a real-world climate of capitulation may not always work against the public interest. Judiciously combined with DIT, CCT can explain how external pressures on Virginia government, combined with internal pressures exerted by public opinion in relation to the development of the offshore wind industry, are steering 'capitulation' in directions that assist the public interest in sustainability. In the real world of energy politics, and against RCT, regulators are and have never been neutral, and therefore liable to capture. In a climate of capitulation, and setting aside other questions of the public interest, the willingness of regulators to serve the interests of the regulated community can, when taking external and internal factors into account, redound to the public interest in sustainability.



Offshore Wind, Virginia, Innovation, Regulatory Capture, Environmental Policy