The turnaround in the US administration’s energy policies under President Joe Biden sets the stage for a burgeoning US offshore wind industry, while the federal government seeks to accelerate environmental analysis to make offshore wind energy a significant contributor to new energy targets. clean energy. In the United States, offshore wind power has not yet taken off, with only two small offshore wind farms in operation with less than 50 megawatts (MW) of combined capacity. For comparison, Europe has 113 offshore wind farms in 12 installed countries, with 25 gigawatts (GW) total offshore wind capacity.
The USA breaking records in wind, solar and onshore storage facilities, with records for each in 2020, according to the American Clean Power Association.
But offshore wind energy has lagged considerably, also because of extensive environmental analyzes by federal agencies and the weight of the pros and cons of having offshore wind installations in sight of beaches or in commercial fishing areas.
Federal policy change
But now, President Biden has defined offshore wind energy as a priority policy in one of his first executive actions to face the climate crisis. By interrupting new leases of oil and natural gas on public land or offshore waters, President Biden instructed the Secretary of the Interior to identify measures that can be taken to double renewable offshore wind production by 2030.
Compared to current production, this is really a low bar, The Wall Street Journal grades.
But the radical shift in energy priorities could spur more projects, as an increasing number of American states on the East Coast, just think of New York, are setting ambitious clean energy goals.
States have established more than 29 GW of offshore wind energy acquisition targets to date, while developers plan to bring 9.1 GW of offshore wind energy online by 2026 by developing 13 offshore wind projects, according to the American Clean Power Association.
The 800 MW Vineyard Wind project, 15 miles off the coast of Martha’s Vineyard, is set to become the first large-scale offshore wind farm in the United States and to start providing power in 2023.
The Bureau of Ocean Energy Management (BOEM) said earlier this month that it would resume environmental review of the Vineyard Wind project. The entire review was canceled at the end of last year by the Trump Administration after a request from the Vineyard Wind developers to pause the process to see if the project needed adjustments after switching turbine suppliers.
“Offshore wind energy has the potential to help our nation fight climate change, improve resilience through reliable energy and stimulate economic development to create well-paying jobs,” said Amanda Lefton, director of BOEM.
The developers of Vineyard Wind, a joint venture between Avangrid Renewables and Copenhagen Infrastructure Partners (CIP), said after the federal review process has resumed:
“We look forward to working with the agency in launching an industry that will create thousands of well-paying jobs and, at the same time, take significant steps to reduce the impact of climate change.”
Smoother permission processes can create a $ 166 billion industry
With smoother support policies and lease and permit processes, the development of offshore wind energy can generate a lot of value for the US economy and create thousands of jobs, said Wood Mackenzie last year in research commissioned by industry associations.
Related: Russian and Saudi Arabian oil giants will benefit from Biden’s anti-oil agenda
Smoother processes for leasing and authorizing offshore wind projects can facilitate up to $ 166 billion in offshore wind investments in the United States by 2035, the survey said. The potential for the US offshore wind industry is enormous, if the right policies are in place, according to industry associations.
Wood Mackenzie wait that almost 25 GW of offshore wind capacity will be added in the US by 2029.
“States have already selected 9 GW of capacity, accounting for more than 70% of construction planned by 2026. And in New England and New York, 80% of wind construction during this period will be located offshore,” said WoodMac in a report in June 2020.
“Offshore wind energy can be deployed on a large scale, making it a powerful tool for lawmakers to pursue more ambitious clean energy goals,” said Max Cohen, principal analyst at Wood Mackenzie.
In addition, the US offshore industry also offers opportunities for major European oil players, added Cohen.
The big oil companies bet on the US offshore wind
Some of Europe’s big oil companies, eager to showcase their low-carbon energy commitments and expand their clean energy portfolios, have already taken action to seize these opportunities.
BP made its first action in the offshore wind market in September with a strategic partnership in US offshore wind assets with Equinor in a $ 1.1 billion deal.
Related: The gasoline industry is about to become totally useless
BP bought 50 percent Equinor’s Empire Wind and Beacon Wind assets off Long Island and Massachusetts offshore, respectively, and the strategic partnership will develop up to 4.4 GW from these two offshore wind projects. The two supermajors will also jointly pursue other offshore wind opportunities in the United States.
Equinor and its partner BP were selected last month for the largest US offshore wind award to date, to provide the State of New York with offshore wind energy from the first and second phases of Empire Wind and Beacon Wind, totaling 3.3 GW of energy for the state.
“The US East Coast is one of the most attractive growth markets for offshore wind energy in the world,” said Equinor CEO Anders Opedal.
With supportive policies at the state and federal levels, US offshore wind energy can become an even more attractive growth market.
By Tsvetana Paraskova for Oilprice.com
More top readings from Oilprice.com: