Offshore Wind Power Can Save U.S. Billions On Electricity, Recent DOE Study Finds

Offshore wind power isn’t usually associated with lower-cost energy, at least not in the public imagination. But it turns out that installing 54 gigawatts of offshore wind power off America’s coasts can cut the cost of electricity in the U.S. by an astounding $7.68 billion a year. That’s right: $7.68 billion annually. (If utilities and grid operators pass those savings onto consumers, that’s about $100 a year per family of four.) As the American Wind Energy Association’s Offshore WindPower 2014 conference begins today in Atlantic City,  that’s just some of the good news to report about pollution-free, offshore wind power. This news is out in a recent U.S. Department of Energy study that proves offshore wind power’s potential in the U.S. is far more than theoretical: The National Offshore Wind Energy Grid Interconnection Study.

The study itself was designed to assess technical capacity and the possibility that offshore wind power can become a major component of the U.S. energy system—“to identify and help address the market barriers to the large-scale introduction of offshore wind energy into the U.S. energy portfolio,” its authors say. Just as other experts have noted, that potential is simply waiting to be realized, with about a dozen U.S. projects in some stage of development. The right state and federal policies can help move these projects off of their drawing boards and into the water, the study authors say, and with that, help create a promising clean-energy future for all of us. 

To begin with, there isn’t just 54 gigawatts of cost-effective, accessible wind power potential within 50 miles of U.S. coastlines. There’s more than 134 gigawatts of potential at 209 sites, the NOWEGIS authors conclude. The Atlantic coast, all on its own, has enormous wind resources. And there is substantial potential in the Gulf of Mexico, the Great Lakes, and the Pacific, too. In scouting these areas, the authors were sure to exclude important habitats and marine sanctuaries. (NRDC continues to work with both the U.S. Department of the Interior’s Bureau of Ocean Energy Management and with offshore wind power developers to ensure that one environmental good—pollution-free wind power—doesn’t come at the expense of another—important ocean wildlife and habitat protections.)

More good news from the study: Thanks to the popularity of offshore wind power in both Europe and Asia, the technology is evolving fast, meaning its becoming more powerful and less expensive simultaneously.

The report confirms what other researchers have discovered: Offshore wind power can be an especially important resource for densely populated coastal areas, like the Northeast, the Mid-Atlantic, and northern California, where energy prices are high and land available for generation and transmission is generally limited. All of this means that offshore wind power can help meet peak power needs while reducing grid congestion and fighting the risk of blackouts, especially on hot summer days and cold winter nights when energy demand is highest.

State and federal policies will be key to advancing this promising industry, the study found. State renewable energy standards and other state policies, particularly those that require that a certain percentage of a state’s electricity come from offshore wind power, are essential to making offshore wind power a reality here in the U.S. And the report praises innovations from both the DOI and the DOE—including BOEM’s “Smart from the Start” siting program that can protect vulnerable habitats while expediting permitting and leasing, and the DOE’s Offshore Wind Innovation and Demonstration Initiative, designed  to advance offshore wind power technology, remove market barriers, and demonstrate advanced technologies.

Federal tax policies will be pivotal, too. Conventional, fossil-fuel-powered electricity is highly subsidized by the federal government, NOWEGIS’s authors note. “Policy makers will need to determine whether offshore wind should likewise receive tax credit support to encourage its development….Enacting tax credit support that will extend through 2020 will help support the first generation of offshore wind projects.”

Of particular importance is extension of the now-expired Investment Tax Credit for Offshore Wind Power. It’s due for Congressional consideration as part of a package of so-called tax extenders during the post-elections lame duck session this November. It’s time this and other clean-energy provisions pass.

As an advocate, I’ve promoted many of offshore wind power’s benefits: It can provide reliable, pollution-free energy to the coastal states where a full three-quarters of America’s population lives. It can create tens of thousands of good-paying, permanent jobs. Now, the DOE’s NOWEGIS highlights the substantial amount of money offshore wind power can save all of us—if we enact policies that jumpstart this promising industry now. 

About the Authors

Kit Kennedy

Director, Energy & Transportation program

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