Group: More Than 51 GW of U.S. Offshore Wind in Pipeline
Credit to Author: Darrell Proctor| Date: Thu, 04 May 2023 14:44:47 +0000
A coalition of companies working in the U.S. clean energy sector has released its latest report on the nation’s offshore wind market, noting projects totaling more than 51 GW of capacity are in a growing pipeline of expected installations.
The Washington, D.C.-based American Clean Power Association (ACP) on May 4 said it is tracking projects across 32 leases in U.S. offshore waters. Potential projects have been sited off both the Atlantic and Pacific coasts, as well as in the Gulf of Mexico.
“American offshore wind power is vital to accelerating the deployment of clean energy and the industry is stepping up to the plate to invest,” said John Hensley, the group’s vice president of Research & Analytics. “The rapid growth in the U.S. offshore wind pipeline reflects strong federal and state government commitment to clean energy expansion and the industry’s response to those goals. These projects have the potential to create tens of thousands of jobs, reduce our nation’s dependence on foreign energy, provide coastal cities with reliable clean power, and help the U.S. meet its emissions reduction goals.”
New York, New Jersey, California Lead Way
The ACP’s “Offshore Wind Market Report” details offshore wind targets for several states, highlighting major players such as New York, New Jersey, and California. It says offshore wind project development, construction, and operations are expected to support up to 83,000 jobs by 2030. It also says the offshore wind industry could bring as much as $25 billion annually in economic output, based on data from a previous ACP economic assessment of the sector.
Massachusetts, another state with large targets for offshore wind, on May 2 issued its draft request for proposals for up to 3,600 MW of additional capacity, as the state prepares for another solicitation early next year. The state already has 3,200 MW under contract, including the 800-MW Vineyard Wind 1 project. Vineyard Wind is considered the first U.S. commercial-scale offshore wind farm, and workers reportedly began installing foundations for the project’s towers this week.
The ACP report likely will be discussed at the group’s CLEANPOWER 2023 event later this month in New Orleans, Louisiana. POWER, which has provided extensive coverage of the U.S. and global offshore wind industry, including its potential for expansion, will be in attendance at the conference.
Today’s report also says the industry is supporting the U.S. shipbuilding sector, with more than 30 new vessels on order or under construction to serve offshore wind developers. The report notes that 14 U.S. facilities serving the offshore wind supply chain are either announced or under construction. The group said more than $1.7 billion in investments have been announced for industry components, with three solicitations pending.
The report provides several key takeaways, including:
- 42 MW of offshore wind is currently online, with 51,377 MW in development across 32 leases.
- East Coast projects account for 43,115 MW, or 84%, of the development pipeline.
- New York has 4,362 MW of capacity in the pipeline, followed by New Jersey with 3,758 MW.
- Of total U.S. projects, 16,564 MW are in advanced development, with 33,875 MW in early development.
- At least 10 states have combined offshore wind procurement targets of more than 81,000 MW.
- The Bureau of Ocean Energy Management, or BOEM, the government agency with oversight of U.S. offshore wind, reported that its lease sales in 2022 generated nearly $5.4 billion in federal revenue.
- Prices were highest in the February 2022 auction for the New York Bight area, averaging $8,313/acre.
Supply Chains, Inflation Still Concerns
The ACP said the costs of offshore wind projects are rising. It cited supply chain disruptions, commodity price increases, and inflation, and said steel prices are of particular concern.
It also said lengthy permitting and regulatory timelines continue to be a problem for the industry, which for years has cited U.S. regulatory policy for offshore wind as a reason the U.S. lags China and Europe when it comes to offshore wind installations.
“While the U.S. offshore wind industry is making tremendous strides, it’s essential to address these challenges to ensure the long-term economic viability of these projects,” said Hensley. “A strong, collaborative approach between industry stakeholders and government bodies will help us tackle obstacles—like clarifying permitting processes—and realize the full potential of offshore wind as a key component of our clean energy future.”
Investments in offshore wind in Europe were highlighted at the recent WindEurope 2023 conference in Copenhagen, Denmark. Among the most notable announcements was from Ocean Winds, an international company created as a 50-50 joint venture in 2020 by EDP Renewables and ENGIE. The group said a final investment decision was taken on its 500-MW Dieppe Le Tréport offshore wind farm in France, a project that represents a total investment of €2.7 billion ($2.976 billion).
Ocean Winds last month also said it reached final investment decision on its îles d’Yeu Noirmoutier offshore wind project in France, a 500-MW installation, along with financial close on the 882-MW Moray West project off Scotland.
“Securing financing for three offshore wind projects [in April] not only demonstrates our commitment to delivering clean energy and unlocking local opportunities but shows our solution-driven experience and leadership in the offshore wind energy sector,” said Grzegorz Gorski, chief operating officer of Ocean Winds, during the Copenhagen meeting. “Despite the current global economic challenges, inflation and tension on the supply chain, we have renewed our commitment to the realiZation of our projects securing financing, demonstrating the confidence that the financial markets hold in the strength of our projects and us as the delivery partner.”
—Darrell Proctor is a senior associate editor for POWER (@POWERmagazine).
The post Group: More Than 51 GW of U.S. Offshore Wind in Pipeline appeared first on POWER Magazine.