NREL Predicts Accelerated Offshore Wind Growth Over Next Decade

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In 2018, the U.S. offshore wind project development and operational pipeline grew 1.4% to a potential generating capacity of 25,824 MW, according to a recently released report from the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL).

This potential generating capacity covers 13 states and includes Rhode Island’s Block Island Wind Farm, which was commissioned in 2016. Further, projects totaling 21,225 MW have exclusive site control, meaning the developer has a lease or other contract to develop the site. Most of these projects are on the Eastern seaboard, with one in the Great Lakes, the report says.

The 2018 Offshore Wind Technologies Market Report, prepared by NREL researchers and funded by the DOE’s Wind Energy Technologies Office, notes that state-level policy commitments accelerated in 2018, driving increased market interest in offshore wind development. For example, according to NREL, offshore wind interest grew in California with the passage of the state’s 100% clean energy bill.

In 2018, increased U.S. market interest spurred strong competition at offshore wind lease auctions, the report points out. According to NREL, higher offshore wind lease sale prices indicate increased confidence in future market growth, driven by state policies; confidence in the regulatory and financial institutions to support offshore wind project development in the nascent U.S. market; continued cost reductions; and heightened demand for offshore wind energy in the Northeast in particular.

NREL says that off-take prices for what is expected to be the first commercial-scale U.S. offshore wind project – Vineyard Wind, proposed off the coast of Massachusetts – came in lower than expected at $65–$75 per megawatt-hour. (However, the project is now facing federal delays.)

The report adds that California and Hawaii (which also has a 100% clean energy mandate) have several early-stage floating offshore wind projects in the planning phase. Globally, floating offshore wind pilot projects are advancing, with the global pipeline for floating offshore wind energy reaching 3,100 MW in 2018, with 29 announced projects and 44 MW of operating projects.

NREL says industry forecasts suggest U.S. offshore wind capacity could grow to 11 GW to 16 GW by 2030.

Mark W. Menezes, under secretary of energy at the DOE, says U.S. offshore wind, with more than 25 GW in its development pipeline, is “poised to be a significant part of our comprehensive energy portfolio in the coming years.”

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