The return of US administration energy policy under President Joe Biden sets the stage for a thriving US offshore wind industry, as the federal government seeks to accelerate environmental analyzes to make offshore wind significantly contribute to new clean energy targets. In the United States, offshore wind has not really taken off, with only two small offshore wind farms in operation, with a combined capacity of less than 50 megawatts (MW). For comparison, Europe has 113 offshore wind farms installed in 12 countries, with 25 gigawatts (GW) of total offshore wind capacity.
US destroy records in wind, solar and onshore storage facilities, with records for each of them in 2020, according to the American Clean Power Association.
But offshore wind has lagged far behind, also due to lengthy environmental analyzes by federal agencies and the weighing of the pros and cons of having offshore wind facilities in sight of beaches or commercial fishing areas.
Changing federal policy
But now President Biden has set offshore wind as a priority policy in one of his first executive actions to address the climate crisis. While suspending 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 the production of renewable energy from offshore wind by 2030.
Compared to current production, this is indeed a low bar, the Wall Street Journal notes.
But the radical change in energy priorities could stimulate more projects, as a growing number of US states on the east coast, just think of New York, set ambitious clean energy goals.
States have established more than 29 GW of offshore wind procurement targets to date, while developers plan to bring 9.1 GW of offshore wind by 2026 by developing 13 offshore wind projects, according to the American Clean Power Association.
The 800 MW Vineyard Wind project, located 15 miles off the coast of Martha’s Vineyard, will become the first large-scale wind farm in the United States and will begin delivering energy in 2023.
The Office of Ocean Energy Management (BOEM) said earlier this month that it will do so resume environmental analysis of the Vineyard Wind project. The entire review was canceled late last year by the Trump administration following a request from developers Vineyard Wind to discontinue the process to see if the project needs to be changed after changing turbine suppliers.
“Offshore wind has the potential to help our nation fight climate change, improve resilience through reliable energy and stimulate economic development to create well-paid jobs,” said BOEM Director Amanda Lefton.
The developers of Vineyard Wind, a joint venture between Avangrid Renewables and Copenhagen Infrastructure Partners (CIP), SAPS after resuming the federal review process:
“We look forward to working with the agency as we launch an industry that will create thousands of well-paid jobs while taking significant steps to reduce the impact of climate change.”
Better licensing processes could create a $ 166 billion industry
With supportive policies and easier leasing and licensing processes, offshore wind development could generate much value for the US economy and create thousands of jobs, Wood Mackenzie said last year in research commissioned by industry associations.
About: The oil giants in Russia and Saudi Arabia will benefit from Biden’s anti-oil agenda
Easier leasing and licensing processes for offshore wind projects could facilitate up to $ 166 billion in offshore wind investment in the United States by 2035, research shows. The potential of the US offshore wind industry is enormous, if there are the right policies, according to industry associations.
Wood Mackenzie is expected that nearly 25 GW of offshore wind capacity will be added in the US by 2029.
“States have already selected 9 GW of capacity, representing over 70% of the forecasted construction by 2026. And in New England and New York, 80% of wind construction during this period will be offshore,” WoodMac said in a statement. a report in June 2020.
“Offshore wind can be deployed on a large scale, making it a powerful tool for policy makers to pursue more ambitious clean energy targets,” said Max Cohen, senior analyst at Wood Mackenzie.
Moreover, the US offshore industry also offers opportunities to major European oil players, Cohen added.
Big oil bets are high on the US offshore wind
Some of Europe’s Big Oil, eager to show their commitments to low-carbon energy and expand clean energy portfolios, have already moved to take advantage of these opportunities.
BP made its first move to the offshore wind market in September with a strategic partnership in Offshore wind assets in the USA with Equinor in a $ 1.1 billion deal.
Related to this: the gasoline industry is about to become completely useless
BP bought 50 percent in Equinor’s Empire Wind and Beacon Wind assets off Long Island and off Massachusetts, respectively, and the strategic partnership will develop up to 4.4 GW of the two offshore wind projects. The two supermajors will look together for other offshore wind opportunities in the USA.
Equinor and its partner BP were selected last month for the largest offshore wind award in the US so far to provide New York State with offshore wind power from the first and second phases of Empire Wind and Beacon Wind, totaling 3.3 GW of power to the state.
“The US East Coast is one of the most attractive offshore wind energy markets in the world,” said Anders Opedal, CEO of Equinor.
With state and federal support policies, the US offshore wind could become an even more attractive growth market.
By Tsvetana Paraskova for Oilprice.com
More top readings from Oilprice.com: