U.S. Offshore Wind Market Report Released

The Navigant Consortium released the “U.S. Offshore Wind Market and Economic Analysis: Annual Market Assessment 2012” report, prepared under an award by DOE in order to provide objective economic analysis and reporting of market activities and progress related to offshore wind energy in the United States.

This report provides the first comprehensive annual assessment of the U.S. offshore wind market, a tool intended to enable informed decision-making at all levels of stakeholder engagement including individual projects, industry issues, and energy policy.

The annual offshore wind market assessment report will be updated and published annually for a three-year period, providing stakeholders with a reliable and consistent data source. Over time, it will also inform development of a road map for removing entry barriers and increasing U.S. competitiveness in the offshore wind market.

The 2012 report’s key findings include:

• The offshore wind industry entails additional risks relative to land-based wind that make securing financing more challenging.
• There is a need for significant upgrades in ports since they were not designed with the offshore wind industry in mind.
• The expansive offshore environment and desire to capture economies of scale is driving up the size of offshore turbines and plants.
• There are approximately 4 gigawatts (GW) of offshore wind installations worldwide.
• Thirty-three announced offshore wind projects lay in varying stages of development in the United States, primarily along the Atlantic Coast.
• There are three significant challenges to deploying 54 GW of offshore wind in U.S. waters by 2030 with an average levelized cost of energy (LCOE) of 7¢ per kilowatt-hour (kWh): (1) the high cost of offshore wind energy; (2) a lack of infrastructure such as transmission and purpose-built ports and vessels; and (3) uncertain and cumbersome regulatory processes.
• Improved siting of wind farms, new operations strategies and technologies, and enhanced access for turbines designed exclusively for the offshore market are anticipated to boost plant production and minimize operations expenditures.
• The development of an offshore wind industry in the United States will depend on the evolution of other sectors in the economy.
• A 500 megawatt (MW) reference plant installed in the mid-Atlantic in 2018 is estimated to have capital costs of $3,040 million or $6,080/kW.
• The JEDI model shows that the 500 MW reference plant would support approximately 3,000 job-years over the construction period and drive $584 million in local spending over the same period.

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Press release, December 13, 2012; Image: EERE