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U.S. offshore wind slammed by runaway costs

September 11, 2023 — The U.S. offshore wind industry, banking on a big boost from the landmark Inflation Reduction Act, has found itself face-to-face with a major hurdle that’s been right there in the name all along: inflation.

In fact, the law might even be making it worse.

More than 10 gigawatts of offshore wind projects along the U.S. East Coast – the equivalent of roughly 10 nuclear power reactors – are at serious risk as higher costs force developers to re-crunch the numbers for proposals originally modeled years ago, before a run-up in interest rates and material costs. Orsted, the Danish wind giant, said this week it’s prepared to walk away from projects unless it gets even more government aid. Other developers are already paying tens of millions in penalties to exit contracts they say no longer make financial sense.

“It’s pretty evident that inflationary pressures have blunted the impact” of the IRA, said Josh Price, a director with Capstone, a Washington-based research group. “It wasn’t a silver bullet.”

Orsted’s warnings are the most concrete example yet of the limits of the IRA, which was hailed as a key driver for America’s nascent offshore wind industry. While the law provides at least $370 billion in grants, tax credits, and other incentives for climate and clean energy projects, that’s proving no match for rising inflation and borrowing costs. And by dangling higher incentives for companies sourcing U.S.-made parts, it’s fueling demand before the domestic supply chain catches up, driving prices higher still.

Read the full article at the Portland Press Herald

What do Orsted’s financial problems mean for Rhode Island’s stake in offshore wind?

September 11, 2023 — Orsted A/S, the offshore wind developer anchoring Rhode Island’s place in the industry, is facing rough seas.

The Danish wind giant said in an Aug. 29 announcement that it may write off $2.3 billion in its upcoming, third-quarter earnings. The warning, on the heels of the company’s  $87.8 million second-quarter loss, comes as supply chain slowdowns and interest rate hikes hamper a trio of East Coast projects, including the Revolution Wind project that will power Rhode Island. At best, costs are going up and schedules are behind, with the Ocean Wind project planned for New Jersey, now delayed from 2025 to 2026, executives said.

At worst, the company may abandon the project altogether.

Read the full article at Rhode Island Current

As US East Coast ramps up offshore wind power projects, much remains unknown

September 11, 2023 — As the U.S. races to build offshore wind power projects, transforming coastlines from Maine to South Carolina, much remains unknown about how the facilities could affect the environment.

And that worries some people, particularly those who depend on the sea for their livelihoods.

“We don’t have the science to know what the impact will be,” said Jim Hutchinson, managing editor of The Fisherman magazine in New Jersey. “The attitude has been, ‘Build it and we’ll figure it out.’”

Read the full article at Associated Press

NEW JERSEY: Wind Farm Protesters Vow to Continue Their Fight

September 12, 2023 — Wind farm developer Orsted recently hit the pause button on its proposed project that would include 98 towering turbines in the waters off the South Jersey coast.

But opponents say they will continue to fight until the project is stopped altogether.

On Sunday afternoon in drizzling rain, Congressman Jeff Van Drew, members of the local grassroots organization Protect Our Coast NJ and other anti-wind farm protesters rallied on 35th Street beach in Ocean City to reinforce their goal: No to wind farms, no to Orsted.

“You know it’s about the fishing industry. You know it’s about our beautiful animals that live in the sea. You know it’s about our environment,” Van Drew said to the crowd of a little more than 100 protesters. “You know it’s about our national security – literally, the Pentagon spoke against it and was squashed by the administration in Washington.”

Van Drew continued, “You know it’s about tripling our utility rates, maybe worse. Even Orsted admits that. There is nothing good about this project. The more you learn, the more you read, the more you dig, the more you look into it, the more you realize how very bad this is for all of us.”

Read the full article at OCNJDaily

MASSACHUSETTS: Wind Power Demand High, But So Are Costs

September 10, 2023 — Gov. Maura Healey last week announced a new effort to procure up to 3,600 megawatts of offshore wind power – the largest call out to developers in the state’s history.

Together with three electric companies, the state is seeking projects to produce what amounts to about 25 per cent of Massachusetts’ annual electricity demand. The new request for proposals will likely be welcomed by offshore wind energy developers that have stalled under pre-pandemic agreements to supply power to the state’s main utility companies.

Two companies with plans to place wind turbines off Martha’s Vineyard have agreed to pay tens of millions of dollars to get out of old contracts that they said made the projects economically unviable.

The procurement push from the state is for projects that already have a lease in the outer continental shelf area more than 10 miles south of the Island and signals a willingness to offer developers flexibility as the state strives for more renewable energy.

“With our top academic institutions, robust workforce training programs, innovative companies and support from every level of government – Massachusetts is all-in on offshore wind,” Ms. Healey said in a statement on August 30.

The day before the state’s announcement, SouthCoast Wind agreed to pay $60 million to get out of its contract with three utilities that it had promised to supply power to from the proposed farm 30 miles off the Island. Commonwealth Wind, another developer planning to build to the south of Martha’s Vineyard, agreed to pay $48 million earlier this year.

“Closing these contracts was never the plan but impacts of Covid-related supply chain disruptions and the war in Ukraine made them unfinanceable,” SouthCoast Wind spokesperson Martha Keeley said in a statement to the Gazette.

Read the full article at the Vineyard Gazette

MASSACHUSETTS: Wind Power Demand High, But So Are Costs

September 10, 2023 — Gov. Maura Healey last week announced a new effort to procure up to 3,600 megawatts of offshore wind power – the largest call out to developers in the state’s history.

Together with three electric companies, the state is seeking projects to produce what amounts to about 25 per cent of Massachusetts’ annual electricity demand. The new request for proposals will likely be welcomed by offshore wind energy developers that have stalled under pre-pandemic agreements to supply power to the state’s main utility companies.

Two companies with plans to place wind turbines off Martha’s Vineyard have agreed to pay tens of millions of dollars to get out of old contracts that they said made the projects economically unviable.

The procurement push from the state is for projects that already have a lease in the outer continental shelf area more than 10 miles south of the Island and signals a willingness to offer developers flexibility as the state strives for more renewable energy.

“With our top academic institutions, robust workforce training programs, innovative companies and support from every level of government – Massachusetts is all-in on offshore wind,” Ms. Healey said in a statement on August 30.

The day before the state’s announcement, SouthCoast Wind agreed to pay $60 million to get out of its contract with three utilities that it had promised to supply power to from the proposed farm 30 miles off the Island. Commonwealth Wind, another developer planning to build to the south of Martha’s Vineyard, agreed to pay $48 million earlier this year.

“Closing these contracts was never the plan but impacts of Covid-related supply chain disruptions and the war in Ukraine made them unfinanceable,” SouthCoast Wind spokesperson Martha Keeley said in a statement to the Gazette.

Read the full article at Vineyard Gazette

Ørsted resumes off-shore survey for wind farm

September 10, 2023 — Ørsted, a clean energy company, will conduct offshore geophysical surveys in Delaware this Fall in support of Skipjack Wind’s development.

Skipjack Wind is a 966-megawatt offshore wind farm that is planned to power nearly 300,000 homes in the region. It’s important to note however that there is no site at the moment for an interconnection facility that would bring cables on shore. An onshore site is necessary before the project can come to fruition. Past proposed interconnection facility sites included Bethany Beach and Fenwick Island State Park, but nothing has been finalized. The latter was struck down after massive public opposition.

The US-flagged R/V Shackleford will conduct high-resolution geophysical surveys in the nearshore ocean environment to approximately 6 miles off Delaware’s coast. The purpose is to collect data about the seafloor and the geology beneath it, and to identify potential archaeological resources and debris left by other ocean users.

OREGON: Federal officials will meet with Oregonians about controversial offshore wind energy projects

September 10, 2023 — Federal Bureau of Ocean Energy Management officials will meet with Oregonians concerned or curious about potential floating offshore wind energy projects following public and political outcry.

Officials will host three in-person meetings in Gold Beach, Coos Bay and Brookings on Sept. 26, 27 and 28. The agency also doubled the public comment period from 30 to 60 days, until Oct. 16.

Generating clean energy from wind turbines floating in the Pacific Ocean is part of state and federal plans to rapidly reduce greenhouse gas emissions contributing to global climate change. But some residents of the Oregon Coast and several tribal nations are concerned about the potential impact to marine life, fisheries and the industries and people who depend on them.

Coos Bay and Brookings are closest to the two swaths of Pacific Ocean identified by the ocean energy agency as ideal for large wind turbines that would float about 18 to 32 miles from land. Energy generated across the 344 square miles of open ocean identified for the projects could power nearly 200,000 homes. The federal agency would like to host an auction by year’s end, allowing companies interested in developing ocean wind energy to bid on leases for the sites. A similar auction in California in 2022 brought in $757 million in winning bids for four companies.

Read the full article at Oregon Capital Chronicle 

RHODE ISLAND: RI fishermen’s board resigns en masse over Biden admin-backed offshore wind farm: ‘Wholesale ocean destruction’

September 6, 2023 — A plan backed by the Biden administration to OK a string of wind farms off Rhode Island has prompted every member of a fishing regulatory board in the state to resign.

The entire Rhode Island Fisherman’s Advisory Board quit en masse Friday to protest the 84-turbine Sunrise Wind project after the state’s Coastal Resources Management Council approved the third offshore wind farm in two years off the Ocean State’s waters.

The project falls under President Biden‘s executive order authorizing his Interior Department to double US offshore wind capacity by 2030. With the project’s approval, the Bureau of Ocean Energy Management is on track to finish reviews for 16 wind farms by 2025.

But foes including the fishing board say the Sunrise plan ignores environmental regulations and anglers’ concerns

Read the full article at the New York Post

US offshore wind projects seek looser subsidy rules in fight for survival

September 6, 2023 — A fleet of U.S. offshore wind projects central to President Joe Biden’s climate change agenda may not move forward unless his administration eases requirements for subsidies in the year-old Inflation Reduction Act, according to project developers.

Norway’s Equinor, France’s Engie (ENGIE.PA), Portugal’s EDP Renewables (EDPR.LS), and trade groups representing other developers pursuing U.S. offshore wind projects told Reuters they are pressing officials to rewrite the requirements, and warning of lost jobs and investments otherwise.

“The components needed for our projects to progress simply do not exist in the U.S. at this time, and we see no signs that the supply chain will be ready in time to meet our procurement schedule,” said David Marks, a spokesperson for the U.S. renewables division of Equinor (EQNR.OL).

Denmarks’ Orsted (ORSTED.CO), a top offshore wind developer, warned last week that barriers to securing U.S. subsidies under the IRA, combined with soaring interest rates and supply chain delays, could lead to $2.3 billion in impairments for three projects, sending its stock plummeting.

Read the full article at Reuters