This article is republished from The Dialog underneath a Artistic Commons license.
America’s first large-scale offshore wind farms started sending energy to the Northeast in early 2024, however a wave of wind farm mission cancellations and rising prices have left many individuals with doubts in regards to the trade’s future within the US.
A number of huge hitters, together with Ørsted, Equinor, BP, and Avangrid, have canceled contracts or sought to renegotiate them in latest months. Pulling out meant the businesses confronted cancellation penalties starting from $16 million to a number of hundred million {dollars} per mission. It additionally resulted in Siemens Power, the world’s largest maker of offshore wind generators, anticipating monetary losses in 2024 of round $2.2 billion.
Altogether, tasks that had been canceled by the tip of 2023 have been anticipated to whole greater than 12 gigawatts of energy, representing greater than half of the capability within the mission pipeline.
So, what occurred, and may the US offshore wind trade recuperate?
I lead the College of Massachusetts Lowell’s Middle for Wind-Power Science, Expertise, and Analysis (WindSTAR) and Middle for Power Innovation, and comply with the trade intently. The offshore wind trade’s troubles are difficult, nevertheless it’s removed from useless within the US, and a few coverage adjustments could assist it discover firmer footing.
A Cascade of Approval Challenges
Getting offshore wind tasks permitted and authorized within the US takes years and is fraught with uncertainty for builders, extra so than in Europe or Asia.
Earlier than an organization bids on a US mission, the developer should plan the procurement of the whole wind farm, together with making reservations to buy parts resembling generators and cables, building tools, and ships. The bid should even be cost-competitive, so firms tend to bid low and never anticipate surprising prices, which provides to monetary uncertainty and danger.
The profitable US bidder then purchases an costly ocean lease, costing within the a whole bunch of hundreds of thousands of {dollars}. However it has no proper to construct a wind mission but.
Earlier than beginning to construct, the developer should conduct website assessments to find out what sort of foundations are attainable and establish the size of the mission. The developer should consummate an settlement to promote the ability it produces, establish some extent of interconnection to the ability grid, after which put together a building and operation plan, which is topic to additional environmental evaluate. All of that takes about 5 years, and it’s solely the start.
For a mission to maneuver ahead, builders could must safe dozens of permits from native, tribal, state, regional, and federal businesses. The federal Bureau of Ocean Power Administration, which has jurisdiction over leasing and administration of the seabed, should seek the advice of with businesses which have regulatory tasks over totally different features within the ocean, such because the armed forces, Environmental Safety Company, and Nationwide Marine Fisheries Service, in addition to teams together with industrial and leisure fishing, Indigenous teams, transport, harbor managers, and property homeowners.
