Clean Power

Published on March 2nd, 2012 | by Andrew


DOE Launches 6-Year, $180mm Offshore Wind Development Initiative

March 2nd, 2012 by  

The US has been slow to try and capitalize on the huge potential of offshore wind energy to reliably supply clean, renewable electricity to population centers along the US’ extensive coasts. That’s beginning to change, however, as the Obama administration ramps up its efforts to stimulate economic growth and environmental sustainability by fostering development of domestic renewable energy resources.

Energy Secretary Steven Chu yesterday announced the launch of an ambitious offshore wind energy research and development initiative that, over the next six years, will see some $180 million invested in accelerating “the deployment of breakthrough wind power technologies that will help diversify our nation’s energy portfolio, promote economic development and launch a new industry here in America,” according to a Dept. of Energy (DOE) press release.

“Developing all of our nation’s vast energy resources is an important part of President Obama’s blueprint for an American economy that uses all of America’s energy resources,” the EnergySecretary stated. “The new offshore wind energy initiative announced today will help to catalyze the development of offshore wind in America, supporting U.S. innovators as they seek to design and demonstrate next generation wind energy technologies. These investments are critical to ensuring that America remains competitive in this growing global industry that can drive new manufacturing, construction, installation and operation jobs across the country.”

The funds are subject to Congressional appropriations, with an initial $20 million slated to be made available in 2012 as the first step in supporting up to four innovative offshore wind energy installations, according to Secretary Chu.

Soliciting Letters of Intent for Initial 4 Offshore Wind Projects

Strong, consistent winds blow all along the US Atlantic, Pacific, Gulf of Mexico and Great Lakes’ coastlines, holding out potential energy estimated at some 4,000 gigawatts (GW). Tapping into them poses significant challenges that will require advances and testing all along the wind power supply chain, however.

High up-front capital costs are another constraining factor that needs to be addressed. It should be noted that a combination of supportive accounting rules, government tax incentives, and subsidies have helped the US offshore oil and gas industry to thrive.

It also should be noted that offshore wind power development has been robust in Europe. Denmark’s DONG Energy recently announced that the family firm that owns LEGO will invest some $534 million for an equity stake in DONG’s 277-MW Borkum Riffgrund 1 offshore wind farm. Expected to start generating clean, renewable electricity in 2015, the offshore wind farm will supply all of LEGO’s power needs through 2020.

Developing offshore wind energy resources also has a large upsdie in terms of job creation. A recently published Price Waterhouse Coopers (PwC) study found that some 33,000 Germans are now employed in the offshore wind power sector.

Aiming to surmount these hurdles, the DOE’s offshore wind power initiative will focus on achieving “large cost reductions over existing offshore wind technologies,” according to the DOE. Demonstration projects “will help address key challenges associated with installing utility-scale offshore wind turbines, connecting offshore turbines to the power grid, and navigating new permitting and approval processes.”

The Obama administration’s offshore wind power program is being launched as the DOE continues to work with the Dept. of Interior and other federal government offices to evaluate the nation’s offshore wind resource potential, identify areas with the highest potential, and devise a comprehensive offshore wind energy strategy.

The DOE is soliciting proposals from offshore wind power resource development groups for the first four projects slated for funding in 2012. Program funds may be used to cover up to 80% of a project’s design costs and 60% of hardware and installation costs. Letters of intent (LOI) are due on March 30 and applications are due on May 31, 2012.

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About the Author

I've been reporting and writing on a wide range of topics at the nexus of economics, technology, ecology/environment and society for some five years now. Whether in Asia-Pacific, Europe, the Americas, Africa or the Middle East, issues related to these broad topical areas pose tremendous opportunities, as well as challenges, and define the quality of our lives, as well as our relationship to the natural environment.

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  • Dave2020

    Hi Bob,

    I don’t think this is about how long it takes to establish an industry, it’s more about selecting the best technology to give new industry a head start on the competition.

    The first off-shore wind farm was built 20 years ago, using on-shore design that had hardly changed in the previous 20 years. That’s the industry failing to innovate, not new industry taking decades to get established. This often happens if market intervention is through production subsidy. There is little incentive to spend on R&D and no urgency to innovate.

    Spending this $180m over 6 years on “accelerating the deployment of breakthrough wind power technologies” is the wrong objective on the wrong timescale. Public investment has to address market failure by funding the disruptive R&D that private business avoids, so you don’t ask the incumbents for their ideas. To “launch a new industry” you have to first identify exactly what it is. Marine renewables include wave and tidal stream, not just wind. It makes no sense to develop any one in isolation, when they could share the same structure and infrastructure. Why do they use turbines not designed for (floating) off-shore?

    Some lateral thinking on these lines could help to achieve the “large cost reductions over existing wind technologies.” we’re looking for, instead of playing ‘catch-up’ on the pioneers who are (they think) ten years ahead.

    • Bob_Wallace

      Feels like you’re making up stuff to support your personal narrative….

      Offshore turbines have gone from small units to the now-under-development 10MW monsters that are so large they have helicopter pads on top of their nacelles. Turbines without gear boxes have been developed in order to cut turbine weight and reduce maintenance. Floating towers for deep water wind farms are being deployed.

      Those are major changes.

      To launch a new industry you definitely do not need to first identify exactly what it is. No one knew that we’d get cell phones which are actually tiny computers that we could carry around in our pocket when the government began to support mini-computers. Out of those refrigerator-sized computers sprang the “Apples” and then all the other very smart, very small devices we use.

      Yes, marine renewables do include wave and tidal as well as wind. At the moment other countries are supporting wave and tidal more than the US government is. That’s OK. We don’t have to invent everything. (We’re not even doing the heavy lifting with offshore wind. Europe is doing that.)

      Personally I think it’s great that other countries are taking the lead in some technologies. Smart people are not unique to the US. We’re all on this ball of water and dirt together, I don’t care who figures out how to snatch us from the fossil fuel dragon. I just want us saved.

      • Dave2020

        “I don’t care who figures out how to snatch us from the fossil fuel dragon. I just want us saved.”

        I share your philosophy, so my “narrative” isn’t personal, it’s global and impartial. I look at a problem and start with a clean sheet – i.e. no bias toward any particular solution.

        “Those are major changes.” Well I’m not sure about that. This looks more like the incremental development that business is comfortable with.

        “To launch a new industry you definitely do not need to first identify exactly what it is.” You do if you want to get it right and quick. Kennedy set the Apollo deadline. First question for the scientists – “How do we do this?” The overwhelming majority of the smart people on the Program believed you would simply land on the moon and return in one spaceship.

        One maverick, John Houbolt said no, LOR is the only way and he did the calc’s to prove it. That wasn’t good enough for the reactionary sceptics. Some guys resorted to ridicule and personal insults. (sound familiar?) It took Houbolt and his associates two years to change minds. Google for the whole story, if you’re not familiar with it – fascinating.

        “Other countries are supporting wave and tidal.” I know, I live there. Those “world-leading” industries are divorced from off-shore wind. A handful of unprofitable companies struggle to survive without decent R&D support, competing against each other. It’s daft. All the work – none of the reward.

        Progress is painfully slow, 10 or 12 years, and you may be ‘heading up the wrong creek without a paddle’. This is no way to galvanize industrial regeneration. The big energy guys look on with a smug grin, while these poor firms go bust. Or, if they do succeed, they’ll buy them up and grab the fruits of years of R&D labour dirt cheap.

        “We’re not even doing the heavy lifting with offshore wind. Europe is doing that.” Yes, and the US won’t need ANY dedicated heavy-lift kit, if they don’t repeat the same mistakes that Europe made and is still making.

  • Bob_Wallace

    New industries generally need several years before they are fully established.

    The onshore wind industry has been receiving help for 40 years or so and is just now getting close to standing on its own.

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