July 6, 2018 Read More →

European companies target U.S. offshore wind market


The Trump administration wants to fire up development of the U.S. offshore wind industry by streamlining permitting and carving out vast areas off the coast for leasing—part of its ‘America First’ policy to boost domestic energy production and jobs.

The drive to open America’s offshore wind industry has attracted Europe’s biggest renewable energy companies, who see the U.S. East Coast as a new frontier after years of success across the Atlantic. Less experienced U.S. wind power companies, meanwhile, have struggled to compete in their own backyard, according to lease data and interviews with industry executives. Many are steering clear of the opportunity altogether, concerned by development costs and attracted to cheaper options on land.

Since 2014, European-backed companies have won all eight of the U.S. government’s competitive offshore wind lease auctions with aggressive bids that have pumped up prices into the tens of millions of dollars.

Bidding in an auction last year for nearly 80,000 acres off the coast of New York, for example, lasted 33 rounds with Norway’s Equinor, formerly known as Statoil, eventually winning the lease for a record $42.5 million. An individual lease had never before sold for more than $5 million, according to public records. Europeans claimed another victory in May when a partnership between Copenhagen Infrastructure Fund and Avangrid, the U.S. arm of Spain’s Iberdrola, won the largest ever U.S. contract for offshore wind power, in Massachusetts.

While the U.S. East Coast has wind conditions and sea depths similar to the North Sea, it boasts just one five-turbine wind farm off the coast of Rhode Island. That wind farm was developed by privately-held U.S. firm Deepwater Wind LLC, which is backed by hedge fund D. E. Shaw Group. Deepwater Wind’s chief executive, Jeff Grybowski, called the U.S. wind industry’s hesitation to move offshore outdated.  “I’m sure that we will see more American entrants in this business as time goes on,” he said. “Until then we’re happy to fly the flag.”

More: Trump effort to lift U.S. offshore wind sector sparks interest – from Europe

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