The Business Network for Offshore Wind’s latest “U.S. Offshore Wind Quarterly Market Report” suggests that offshore wind continued its forward progress in the third quarter despite severe financial challenges.
Notably, work continues at the nation’s first two commercial-scale projects, and many other projects have notched critical permitting milestones. For example, Vineyard Wind and South Fork Wind are on the precipice of delivering their first power to the grid, the pipeline of projects approved for construction has tripled in size, and more projects are weeks away from achieving final approval.
“The U.S. offshore wind market felt its growing pains over the past quarter, taking two steps forward and two steps back,” says Liz Burdock, founder and CEO of the Business Network for Offshore Wind. “We celebrated our first two utility-scale projects on the verge of delivering power to the grid, a monumental milestone a decade in the making – but simultaneously suffer project delays and continued supply chain challenges.”
Along with steady progress on the first commercial-scale projects and a flurry of project approvals, the third quarter saw California move closer to offshore wind deployment, with new authority to buy power generation, as well as New England states strengthen their collaboration.
Despite this progress, significant cost increases due to global economic turmoil resulted in contract terminations, delaying project deployment.
Among the report’s key findings:
- The pipeline of projects permitted for construction tripled in the third quarter, up to 2.7 GW, with more approvals expected to come in the fourth quarter;
- Three projects, totaling 3.2 GW, have officially announced contract terminations. Each project will attempt to secure a new contract in upcoming state procurement rounds;
- East Coast states increased their coordination, highlighted by new procurement rounds in Massachusetts and Rhode Island;
- Vessel-building and secondary steel manufacturing delivered strong performance among offshore wind supply chain subsectors;
- New York is expected to award new power agreements in the fourth quarter, and with that could come new investments in turbine blade and nacelle facilities.
The complete report can be accessed here.
