March 26, 2018 Read More →

More Wind Power Investment Is Appearing Off More National Shorelines

Financial Times:

France is still in the vanguard of innovation in wind power. General Electric’s offshore wind joint venture with Alstom is developing a huge new turbine, the world’s tallest, which will be built at plants in St Nazaire and Cherbourg on France’s Atlantic coast. It is an important product for GE, which needs to develop other sources of earnings with its traditional gas-fired power generation business in decline. Forecasts from its rival Siemens of the outlook for worldwide sales of large gas turbines make a grim picture for the companies that make them.

Prospects for offshore wind, however, seem to be improving all the time. The Netherlands this week awarded a contract to Vattenfall of Sweden for two 350 megawatt offshore wind farms, described as the world’s first to be built without subsidies. Germany awarded “subsidy free” offshore wind contracts last year, but the Dutch projects are expected to be in service first. For the developers, these contracts are predicated on continued technological progress in offshore wind, thanks to products like GE’s new turbine, which they hope will bring down the cost of generation significantly.

The steep decline in the cost of offshore wind has been remarkable. One estimate last year suggested the new German offshore projects were aiming to produce power for about €31 or $38 per megawatt hour, which compares to a forecast from the US Energy Information Administration of an unsubsidized cost of about $157 per MWh.

In the US, offshore wind development has lagged well behind Europe, partly because of those cost concerns and partly because of some stiff opposition from coastal property owners. If you have the wide open spaces of Texas, Oklahoma and Iowa available for onshore wind development, there is anyway less need to head out to sea. Offshore wind in the US is still attracting interest, however, particularly for the more crowded northeast of the country. A report this week from Environment America, titled Wind power to spare: The enormous energy potential of Atlantic offshore wind, argued that turbines off the US Atlantic coast could produce enough electricity to supply the needs of the coastal states four times over.

Meanwhile, another use of US offshore resources is attracting only limited interest. The latest auction of drilling rights in the Gulf of Mexico, the largest ever in terms of the area offered, had been hyped up by the interior secretary Ryan Zinke as a “bellwether” for US offshore producers, although industry groups had attempted to play down those expectations. When the auction was held on Wednesday, their caution was vindicated. The sale was not a complete flop, but its results showed only a modest level of enthusiasm for new acreage.

More: Fair Winds Blow Offshore

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