U.S. Off-Shore Wind Industry Gets Not One, But Two Major Boosts

The U.S. wind industry — launched in California in the ‘80s under the leadership of former governor Jerry Brown — has become a major player in global markets with traditional onshore power generation applications, leading the world in terms of accumulative wind capacity for the last two years. Yet efforts to move offshore – where wind resources are far superior but logistics are more challenging – have been hampered by a lack of regulatory support, particularly at the federal level of governance.

The American Wind Energy Association (AWEA) sponsored an offshore wind power conference in early October in Atlantic City, New Jersey. It started off with a bang: U.S. Department of the Interior Secretary Ken Salazar signed a 28-year lease for the first off-shore wind project in the U.S., to be located off the coast of Cape Cod, Massachusetts. The Cape Wind project, which will grow to 468 MW when completed, took 8 years to gain final project approvals.

The Obama Administration’s effort to speed up permitting of large-scale renewable projects had already borne fruit in California, Salazar said, pointing to the first two Concentrated Solar Power (CSP) to move finally forward on public lands in southern California. He cast these projects a sign that progress was being made within just one year of a federal permit streamlining initiative.

In a passionate speech, Salazar bluntly proclaimed that taking eight years to permit an offshore wind project was unacceptable. He promised that by the end of 2010, the federal government hopes “to identify places where offshore wind makes sense.” He suggested that this approach — which has been utilized by European countries such as Denmark — could help reduce the length of future permitting battles as environmental reviews could be expedited up-front, “so developer proposals will have a better chance.”

Looking at a map of the U.S., the best offshore wind resource in the U.S. is the Atlantic Coast from Georgia to Maine, with 1,256,000 (Megawatts) MW of potential development, with the best resources in the Northeast. Though the West Coast has 930,000 MW of potential, the steep drop-off renders it impossible to secure foundations for offshore wind turbines, which may reach 10 MW apiece in scale! However, trends in offshore wind deployments are to go farther from shore, and in deeper and deeper water. Floating foundation structures tethered to the ocean’s floor are under development that may allow California, Oregon and Washington to tap a significant new source of renewable energy.

Even further down the road, it might be possible to integrate wave energy resources into these offshore wind networks. Pacific Gas & Electric is conducting research on wave devices just off the Coast of Humboldt County.

Despite the hype and headlines, there was also some sobering news at the conference. The National Renewable Energy Laboratory projects that including the current PTC and other available federal incentives, the cost for offshore wind is still over 22 cents/kWh. An estimate from Europe was even higher – 26 cents/kWh.

Given the high costs of offshore wind, the rationale for policy support is increasingly focused on economic development. Though a recent study by Next 10 revealed that so-called green jobs were was not yet delivering enough momentum to turn the economy around, offshore wind deserves another look.

One study by Siemens showed that offshore wind provides 22 jobs per MW in Europe, which compares to approximately 7 jobs per MW for onshore wind there. Jobs in the U.S. are much lower, according to the study, with just 2 jobs per MW for onshore wind, the key difference being Europe’s market features 90% local content, while the U.S. is closer to 50%. Rather than manufacturing being the key to maximizing jobs on land-based wind projects, it is ongoing maintenance that provides 70% of employment benefits for offshore wind over the long term.

A recent report by the federal National Renewable Energy Laboratory (NREL) claims that the U.S. could feasibly tap 54 gigawatts (GW) of offshore wind energy if the U.S. was to obtain 20% of its total electricity from wind power options by 2030.

Google Steps in on Transmission

The other big news, as far as offshore wind is concerned, is that Google is investing heavily in a $5 billion transmission “backbone” off the Atlantic Coast to help bolster this emerging renewable energy market. The transmission line, which is expected to be constructed 20 miles offshore and stretch from Virginia up to New Jersey, could be up and ready for business as early as 2016. Other partners include Good Energies, an investment firm specializing in renewables, and Marubeni, a Japanese trading firm.

This is not Goggle’s first foray into wind. This past May, the firm raised its profile on green energy when it sank almost $40 million into two North Dakota wind farms. The wind farms are being developed by NextEraEnergy, the subsidiary of Florida, Power & Light that owns and operates the largest fleet of wind farms in the U.S.

A transmission “backbone” off the Atlantic Coast would send a clear signal to the rest of the world that the U.S. is serious about offshore wind. The prime advantage of the backbone approach is that transmission infrastructure is cheaper than storage. Since the wind blowing off the Atlantic Coast in the Northeast is well beyond energy demand, and prevailing patterns move parallel to the coast, building a transmission backbone that hugs the coastline is an infrastructure project that could really be a game changer. This approach allows premium wind resources to complement production from less robust sites, smoothing our fluctuations, and thereby “firm up” this notoriously variable renewable resource.

Meanwhile, the nation’s nuclear industry was struck by another blow as Constellation Energy pulls out of a Baltimore Gas & Electric new construction project in the eastern seaboard.

  • Regulators released a 60-page executive summary of the DRECP at an event headlined by Interior Secretary Sally Jewell and Sen. Barbara Boxer. read here.



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