BNOW CEO discusses steps BOEM is taking to speed up offshore wind's steel in the water

The offshore wind industry is on the brink of major growth, with the Biden administration vowing to build a nationwide clean energy economy and repower the U.S. with renewable energy.

The recent federal legislative action creating a valuable 30 percent tax credit specifically for the industry, has led to offshore wind developers and businesses expressing confidence in investing billions of dollars into the U.S. supply chain.

The nation's offshore wind industry is already primed for major growth, thanks to state governments pushing development forward with bold commitments. A federal government matching the leadership shown in states is expected to unleash the offshore wind industry, driving the development of a larger, more competitive domestic market, as well as opening up export opportunities for American companies.

But the feds will need to take immediate action to break through some major hurdles that the industry still faces. 

“They need to get those Construction and Operations Plans (COPs) to move through their process for permitting,” Liz Burdock, CEO at the Business Network for Offshore Wind (BNOW), told NPM. “That's what the industry needs. Vineyard withdrew their COP in December, and they've now resubmitted it back into BOEM (Bureau of Ocean Energy Management). BOEM has a queue process and I’m hoping that they looked at Vineyard and because it's the furthest along, will focus on it even though it's now technically at the back of the line. It's right there and it's ready for a decision.”

On Monday, Vineyard’s developers told BOEM that the company was rescinding its Dec. 2020 request to withdraw the COP for Vineyard Wind 1, allowing the federal permitting process to resume.

Last month, the developer announced the selection of Haliade-X turbines, temporarily withdrawing its COP in order to conduct a final technical review associated with including the more powerful turbines in the final project design, which has now concluded.

A nod to the Vineyard project is expected to be a watershed moment for other offshore projects, like New York’s 132 MW South Fork Wind, being developed by Orsted and Eversource and expected to come online in 2023. Orsted’s 120 MW Skipjack Wind farm, to be built 20 miles off the Delmarva Peninsula, will likely follow.

“Then the spigot just starts turning on,” Burdock said. “That's really what needs to happen--to get those projects reviewed and moved through their process.”

To keep up with states’ decarbonization goals, BOEM will also need to open up auctions for more lease areas in the New York-New Jersey Bight region, which spans from Long Island to New Jersey's coast, as well as in the Gulf of Maine, off coastal Virginia, and along the West Coast.

The good news, says Burdock, is that lease areas for New York and New Jersey could open up in a matter of months.

“They should be ready to go to auction,’" she said. “I don't think there’s much more federal process that they have to go through in order to have the auction, so I can see those happening within the next six to nine months. The states continue to increase their commitments for offshore wind as they're moving toward their decarbonization goals by 2050, and those decarbonization goals include a lot more offshore wind than even what they committed to. They’re going to need it in order to meet those goals. New York has a 9 GW commitment--that could just be the floor when they're mapping out their strategy to get to carbon neutral by 2050. We’ll never have enough space to build the projects if we don't have the lease areas to meet those state commitments.”

Since the completion of the Block Island Wind Farm in 2016, 16 more lease areas have been approved along the East Coast. As of January 2021, there are 17 active offshore wind leases in the U.S. representing more than 1.7 million acres. 

East Coast states have already committed to procure 30 GW of offshore wind generation capacity, more than can be developed in current existing federal offshore leases. More than a dozen offshore wind projects, totaling 11.6 GW of capacity, have already secured financial offtake and are ready for construction once they receive federal permitting approval.

“BOEM got extra resources in the appropriations budget to hire more people, and we’ve heard from BOEM that they’re thinking of bringing in additional consultants from the outside to help beef up their staffing so that they can have more people working on offshore wind,” Burdock said. “So really it's a capacity issue, and we’re looking to the Biden administration. There obviously will be the political will. Now there needs to be technical capacity within the organization to meet the political will that we know is there.”

Growing a supply chain

States are ramping up efforts to build robust supply chains to support the offshore wind industry, with the next four years expected to see at least 10 GW of generation entering construction, new vessel orders including state-of-the-art wind turbine installation vessels, and billions of dollars in port infrastructure improvements.

Last year, New Jersey announced plans to develop its Wind Port, a first-in-the-nation infrastructure investment that will provide a location for essential offshore wind staging, assembly and manufacturing activities.

New York has also set itself up as an offshore wind powerhouse, announcing last week that it had secured commitments from companies to manufacture wind turbine components within the state. Upgrades to create five dedicated port facilities will include a turbine manufacturing facility, a staging facility, and operations and maintenance hubs.

“One thing I hope to see is that the states really take stock of what their natural, physical attributes are,” Burdock said. “What do they do well within their state that lends itself to the offshore wind supply chain? So instead of just focusing on something that might be attractive like a turbine manufacturer, maybe they can look at something that isn't as sexy, like a robust secondary steel industry for the turbine foundations. The states need to look at what industries they have in their state already, and how those industries can diversify into the offshore wind supply chain. That way it's a more natural fit instead of these attraction strategies to attract somebody in and then build a workforce around it. That takes a lot of resources and time to build up that workforce.”

BNOW has been working with states to tap into their natural supply chain resources, like Rhode Island, which will see Orsted's 704 Revolution Wind farm built off its shores within the next few years. The project has already attracted more than USD 100m in local investment.

“It really comes down to educating those secondary and tertiary businesses about where they fit in the supply chain,” Burdock said. “States can play a really important role in that because they’re asking the developers to hire locally, which is perfectly reasonable. But on the other side of that, they need to make sure that the developers have a qualified pool of companies to draw from in order to mitigate any risk that might occur when you actually are constructing and installing a project.”