Offshore wind developers must think big in U.S., Dong says

NEW YORK – Offshore wind companies need to install 500 megawatts annually for the next 15 years for the technology to make economic sense in the U.S., according to Dong Energy A/S, the world’s biggest developer of sea-based turbines.

Large-scale projects will be the key to reducing installation costs and making electricity from offshore wind farms affordable in the U.S., Thomas Brostrom, the Fredericia, Denmark-based company’s general manager for North America, said Monday.

Offshore wind has thrived for more than a decade in Europe, where it has been subsidized in the U.K., Germany and elsewhere. The expense of building massive turbines at sea has prevented the industry from taking hold in the U.S. Dong is seeking to change that, and sent Brostrom to run its first U.S. office in July.

“The industry needs to think big,” Brostrom said at the U.S. Offshore Wind Leadership Conference in Boston. “As a region you would need ideally 500 megawatts a year. And I think it is possible.”

- Advertisement -

Dong has acquired leases for two U.S. sites, in the waters of New Jersey and Massachusetts, and is scouting the East Coast for other locations, Brostrom said. The company pioneered the world’s first offshore wind farm in 1991, and has projects with more than 2,000 megawatts of capacity in operation and another 1,000 megawatts under construction.

Deepwater Wind LLC began construction in July on the first U.S. offshore wind farm, a 30-megawatt project off Block Island in Rhode Island.

In other news, U.S. Sen. Edward J. Markey plans to introduce legislation “soon” to extend a federal tax credit that will spur wind-farm development in coastal waters.

The Massachusetts Democrat is seeking to extend the investment tax credit until 2025, he said at the conference. The policy grants a 30 percent credit for the costs of developing renewable-energy projects.

The credit has been one a significant drivers for clean energy, especially solar farms. It was scheduled to expire at the end of this year, until Congress unexpectedly renewed it in December for five years. With the Deepwater project currently under construction, Markey’s efforts come just as the industry is starting to gain traction.

“We have an opportunity to provide a long-term extension of this tax policy because the budget experts in Washington don’t know what we in this room know,” Markey told executives at the conference. “Offshore wind is poised to take off in the United States.”

Unlike Europe, the U.S. has no operational offshore wind installations, largely because of the high cost of building at sea. Offshore wind energy costs about twice as much to produce as power from coal, according to data from Bloomberg New Energy Finance, and the credit will offset some of that.

No posts to display