America’s first large-scale offshore wind farms began sending power to the Northeast in early 2024, but a wave of wind farm project cancellations and rising costs have left many people with doubts about the industry’s future in the US.
Several big hitters, including Ørsted, Equinor, BP, and Avangrid, have canceled contracts or sought to renegotiate them in recent months. Pulling out meant the companies faced cancellation penalties ranging from $16 million to several hundred million dollars per project. It also resulted in Siemens Energy, the world’s largest maker of offshore wind turbines, anticipating financial losses in 2024 of around $2.2 billion.
Altogether, projects that had been canceled by the end of 2023 were expected to total more than 12 gigawatts of power, representing more than half of the capacity in the project pipeline.
So, what happened, and can the US offshore wind industry recover?
I lead the University of Massachusetts Lowell’s Center for Wind-Energy Science, Technology, and Research (WindSTAR) and Center for Energy Innovation, and follow the industry closely. The offshore wind industry’s troubles are complicated, but it’s far from dead in the US, and some policy changes may help it find firmer footing.
A Cascade of Approval Challenges
Getting offshore wind projects permitted and approved in the US takes years and is fraught with uncertainty for developers, more so than in Europe or Asia.
Before a company bids on a US project, the developer must plan the procurement of the entire wind farm, including making reservations to purchase components such as turbines and cables, construction equipment, and ships. The bid must also be cost-competitive, so companies have a tendency to bid low and not anticipate unexpected costs, which adds to financial uncertainty and risk.
Before starting to build, the developer must conduct site assessments to determine what kind of foundations are possible and identify the scale of the project. The developer must consummate an agreement to sell the power it produces, identify a point of interconnection to the power grid, and then prepare a construction and operation plan, which is subject to further environmental review. All of that takes about five years, and it’s only the beginning.
For a project to move forward, developers may need to secure dozens of permits from local, tribal, state, regional, and federal agencies. The federal Bureau of Ocean Energy Management, which has jurisdiction over leasing and management of the seabed, must consult with agencies that have regulatory responsibilities over different aspects in the ocean, such as the armed forces, Environmental Protection Agency, and National Marine Fisheries Service, as well as groups including commercial and recreational fishing, Indigenous groups, shipping, harbor managers, and property owners.
Long Island, New York — Thirty-five miles off the coast of Long Island, an 800-foot tall wind turbine made history this month as the first offshore turbine to provide power to a U.S. grid.
The power from the first turbine at the South Fork Wind Farm to become operational travels through an undersea cable and underneath a beach, where it then connects to New York state’s electricity grid.
David Hardy, CEO of Ørsted Americas — the company building New York’s first offshore wind farm — describes the cable as a “78-mile extension cord.”
When complete, South Fork’s 12 turbines will generate 132 megawatts of power.
“For those that don’t speak energy that’s 70,000 homes,” Hardy said. “This is a first. This is a milestone.”
Roughly two dozen other offshore wind farms were planned along the East Coast to generate clean power to replace dirty fossil fuels.
“You’ve got some of the best winds in the world here,” Hardy said.
One such project near Massachusetts’ Martha’s Vineyard is about to come online. However, inflation, rising interest rates and supply chain issues have now made several others too expensive to build. Ørsted canceled two wind farms off the New Jersey coast and is reconsidering two others.
“Probably in some ways we were too optimistic on some things,” Hardy said. “We got caught on the wrong end of some of these macro trends.”
The projects were key to President Biden’s goal of 30 gigawatts of offshore wind power by 2030, enough to power more than 10 million homes. Analysts now predict the industry will build less than half that, according to Bloomberg.
“We still see a large growth opportunity for offshore wind over the long term,” said Timothy Fox, vice president of Clearview Energy Partners. “It’s just, its trajectory is going to be on a longer and flatter incline than I think first envisioned by a lot of the East Coast states.”
Hardy says building an industry this complex is not easy, but it’s essential to a clean energy future.
“We’re just at the beginning of something that could be really, really big, and needs to be successful,” Hardy said.
Ben Tracy is CBS News’ senior national and environmental correspondent based in Los Angeles. He reports for all CBS News platforms, including the “CBS Evening News with Norah O’Donnell,” “CBS Mornings” and “CBS Sunday Morning.”
Representatives from nearly every nation have met this week at an annual climate summit, searching for agreements on how to curb the rise of global temperatures. The summit is being held in the oil-rich United Arab Emirates, and that has dismayed activists who believe that the only way to really address the climate crisis is to walk away from fossil fuels.
For the moment at least, the world and the United States need both fossil fuels and renewable energy, and the best proof of that may be found in the state of Wyoming.
It is the country’s leading coal producing state, and very conservative politically, yet its Republican governor, Mark Gordon, is emerging as a leading voice promoting climate-friendly energy projects and action to address the climate crisis.
Essentially, Mark Gordon is trying to prove that it is possible to be both red and green.
Gov. Mark Gordon: We needed to be aggressive. And we needed to really address this issue.
Bill Whitaker: So you tell the people of Wyoming that climate change is real?
Gov. Mark Gordon: I do.
Bill Whitaker: And that it’s urgent, it’s an urgent crisis?
Gov. Mark Gordon: I have said that. And I’ve gotten– I’ve gotten some pushback from that as well.
Bill Whitaker: I bet you have. (laughter)
Wyoming Gov. Mark Gordon on the cattle ranch where he grew up
60 Minutes
In September, we met Mark Gordon, who’s in the middle of his second term as Wyoming’s governor, on the cattle ranch where he grew up.
Gov. Mark Gordon: This is my dad’s old saddle.
His family still owns this ranch, and he and his wife also operate another about 40 miles away.
Bill Whitaker: How did growing up here affect your worldview?
Gov. Mark Gordon: I think growing up here gave me a– an enormous appreciation for the world around us, and– and the ecological processes, and the weather. You just are exposed to it on a regular, on a regular basis.
Mark Gordon is also a mountain climber who has seen glaciers receding due to a warming climate. He says that helped convince him to set a goal of making Wyoming not just carbon neutral when it comes to CO2 emissions, but eventually, carbon negative.
Bill Whitaker: You first made this pledge of– net negative CO2 emissions at a 2021 State of the State speech. How did that go over?
Gov. Mark Gordon: I think some people probably resented it. I think generally it’s been well-respected. It was, to– to some degree, a bold move, and– and one that was intended to make a difference in that discussion about energy in the future.
After Gordon repeated his net-negative emissions goal at an appearance at Harvard in October, Wyoming’s Republican party passed a vote of “no confidence” in him. But he says heat from the right won’t deter him from pursuing what he calls an “all of the above” energy policy.
Gov. Mark Gordon: Whatever you’re going to do in energy, probably you’re going have something to do in Wyoming. We have tremendous wind resources. We have the largest reserves of uranium, important for nuclear energy, the largest coal producer, we’re number eight in oil, number nine in natural gas. 83% of our energy is exported.
That will soon include nuclear power from a next-generation reactor to be built in Wyoming with a $500 million investment from Bill Gates. Huge wind farms already dot Wyoming’s landscape, with the biggest one yet on the way.
Bill Miller: Because the wind blows basically 24/7, 365 days a year.
Huge wind farms dot Wyoming’s landscape
60 Minutes
Bill Miller is president of the Power Company of Wyoming, which is beginning to build what will be the largest wind farm in the continental United States, in the middle of a geographic break in the Continental Divide.
Bill Miller: All the winds which blow from west to east pretty much are funneled through this part of the country.
Miller drove to the top of a place called Chokecherry Knob to give us a taste of the wind.
Bill Whitaker: So when this is up and running, how many turbines will be out here?
Bill Miller: Current plan calls for 600 turbines.
Bill Whitaker: And how much energy will that generate?
Bill Miller: They’ll generate around 12 million megawatt hours of power a year.
Bill Whitaker: And that’s– and that’s enough to power how many homes?
Bill Miller: Million, a million-two.
Wyoming doesn’t have anything close to that many homes – it has the smallest population of any of the 50 states – so the plan is to build a new 800 mile-long transmission line to send that power to California, which needs and wants it.
Bill Whitaker: What’s this going to cost?
Bill Miller: The wind farm will be something north of $5 billion. Transmission line will be something north of $3 billion capital investment.
Bill Whitaker: That’s a big investment.
Bill Miller: Yes.
The project is bankrolled by billionaire Philip Anschutz, who owns the company Bill Miller runs, and who first made his fortune in oil.
Bill Miller: Society has spoken. That’s what this country is going to go to, is renewable energy. More importantly, it’s a project that contributes to the zero-carbon initiatives that– we strongly believe in. It’s going to happen. And this is the best place for it to happen.
bill Miller, president of the Power Company of Wyoming
60 Minutes
At this past summer’s windy groundbreaking ceremony for the transmission line, Bill Miller was joined not just by Republican Gov. Mark Gordon, but also by two members of President Biden’s Cabinet.
Gov. Mark Gordon: The way we’ve tried to navigate this is to find something for everyone. And– I think that’s the–
Bill Whitaker: Is that possible?
Gov. Mark Gordon: Yeah. I think it is. Honestly, I think if– if people are going to embrace how we get to a carbon neutral, carbon negative future, it has to be by saying, “We’re all going to be a little bit better by embracing innovation.”
If a single picture can capture Wyoming’s energy past, present andfuture, this may be it: a fully loaded coal train passing in front of a huge wind farm. Remember, this state still produces more coal than any other, by far.
Dr. Holly Krutka: The likelihood that we will truly as a world move away from fossil fuels is very low.
Holly Krutka runs the School of Energy Resources at the University of Wyoming. Before shifting to academia, she worked for Peabody, the largest coal company in America.
Dr. Holly Krutka: 82% of– our global energy consumption is fossil fuels.
Bill Whitaker: 82%?
Dr. Holly Krutka: 82%. It has not changed.
Because of that stark fact, Krutka and her colleagues are focused on taking the CO2 out of fossil fuels like coal before it reaches the atmosphere, with a technology called carbon capture and storage.
Dr. Holly Krutka: There are carbon capture and storage projects in America working right now. There’s just not enough. The capture side, we’re there. Today.
Bill Whitaker: You can do it now?
Dr. Holly Krutka: Right now. Yes.
Dr. Holly Krutka
60 Minutes
Bill Whitaker: The technology is there, but is it economically feasible?
Dr. Holly Krutka: It will always be cheaper to do nothing than to add carbon capture and storage. If you want to reduce emissions, this is part of the solution. We have to decide, is it worth the cost.
At the huge dry fork coal-fired power plant near Gillette, the University of Wyoming is operating what it calls the Integrated Test Center. Some of the flue gas that would otherwise go up the smokestack is siphoned off into labs like this one, where the Japanese company Kawasaki is testing methods for making carbon capture more economical. Wells, 10 thousand feet deep, have also been drilled to show that captured CO2 can be stored underground, forever.
Bill Whitaker: How big a deal would it be to find– an affordable way to capture carbon at the point of emission– say, in power plants– around the world?
Gov. Mark Gordon: It would be a game changer, for certain.
Bill Whitaker: You know there are a lot of naysayers who say that this is a pipe dream.
Gov. Mark Gordon: Uh-huh (affirm).
Bill Whitaker: It’ll never happen. What do you say to them? How do you convince them?
Gov. Mark Gordon: Well, I say we’re trying it. And I know people will say, “Well, you’re just trying to extend the life of the coal mines.” I am. But I am also trying to do that in a way that is going to do more for climate solutions than simply standing up a whole bunch of wind farms or sending up a whole bunch of solars.
With his “all of the above” approach, Mark Gordon is trying to put every kind of energy project on a fast track, including Bill Miller’s huge wind farm.
Bill Whitaker: How long did you think it was going to take when you started?
Bill Miller: When I originally started, I thought we could probably get this entitled and under construction within five years.
Bill Whitaker: And it’s been 17?
Bill Miller: 17.
Bill Whitaker: Why so long?
Bill Miller: Primarily, the permitting process, the bureaucracy of the federal government.
Bill Whitaker: You told me, coming up here, that the– the process was kind of like a nightmare.
Bill Miller: It was difficult. (laugh) Maybe, “Nightmare,” is a little bit too strong. But– it was a very difficult process.
Bill Whitaker: So how important is it to reduce regulatory and permitting barriers?
Gov. Mark Gordon: I think it’s massive. Permitting reform I think is one of our biggest challenges at a federal level. It is something that’s being embraced– by both sides.
Both the Biden administration and congressional Republicans have endorsed the idea of streamlining permitting for energy projects. Actually doing it is another story. In Wyoming, Gov. Gordon has done what he can.
Cully Cavness: One thing I can share is that it’s a state that’s very welcoming to innovators in the energy space.
Cully Cavness is co-founder of a company called Crusoe Energy Systems. About five years ago, it decided to tackle the problem of “flaring,” when gas produced at oil wells is simply burned into the atmosphere.
Cully Cavness, co-founder of a company called Crusoe Energy Systems, speaks with Bill Whitaker
60 Minutes
Cully Cavness: If you could capture it all it would power about two-thirds of Europe’s electricity. It’s a very large amount of waste.
Bill Whitaker: And we’re just burning it off.
Cully Cavness: We’re burning it off because there’s no pipeline there.
Cavness and his colleagues came up with the unconventional idea of putting a small electricity-generating power plant right where that gas was being flared and wasted.
Cully Cavness: What we do is we tap into that gas line. We bring the gas over to a power generation system, and then that generates electricity, and we take that electricity directly into our onsite data center to power hundreds or thousands of computers, and then we network the computers to the outside world with fiber or satellite internet to get it offsite.
Bill Whitaker: So you take a– data center and just basically put it on top of the wellhead.
Cully Cavness: Exactly. It’s a modern data center in every way when you’re standing inside of it. And then you step out the door and you’re in an oil field.
Crusoe Energy first used those electricity-gobbling data centers to mine bitcoin; Now most of that computer power is being used by artificial intelligence companies. The first place to let them try this, in 2018, was Wyoming.
Cully Cavness: That’s not necessarily an idea that everyone’s going to embrace automatically right off the bat before it’s been done before. Wyoming was. They invited us to come do it for the first time here. We did it at a small scale. We proved that it could work. And that helped us attract the funding and the other projects that had helped us scale to where we are today.
Bill Whitaker: How many of these– centers do you have up and running currently?
Cully Cavness: We’re approaching 200. By the end of the year, we’ll have about 200 of our modular data centers deployed throughout the United States and now internationally.
Bill Whitaker: So how do you assess your environmental impact?
Cully Cavness So today we’re operating at a scale of more than 20 million cubic feet of gas per day that would have otherwise been flared and wasted. We’re preventing that flaring. It’s on the order of several hundred thousand cars per year being taken off the road in terms of the avoided emissions impact.
Bill Whitaker: Are you trying to send out a message to the rest of the country and even the rest of the world? “If you have a renewable or a climate-friendly idea, bring it here, bring it to Wyoming.”
Gov. Mark Gordon: Love to. We, we want to be part of the solution. There are some really remarkable things that if we– stop talking about what we shouldn’t do and start talking about what we can do and how we can embrace that future. And that’s what we’re dedicated to here in Wyoming.
Produced by Rome Hartman. Associate producer, Sara Kuzmarov. Broadcast associate, Mariah B. Campbell. Edited by Jorge J. García.
Over time, changes in the market, manufacturing, and technology have closed the doors on what were once thriving industrial operations that supported whole communities.
Bethlehem Steel, near the Port of Baltimore, was one of those operations that faded with time, Electrek reports. Now, however, the site will take on new life as US Wind repurposes part of the land to manufacture turbines for generating wind power.
Bethlehem Steel was founded in 1887 and became the largest steel producer in the world in the 1950s, Electrek explains. At one point, it employed 30,000 workers, some of whom lived at the facility. However, the mill went bankrupt and closed permanently in 2012.
In 2021, US Wind, a developer that has created multiple offshore wind farms, announced that it would use 90 acres of the sprawling Bethlehem steel mill site to build its new manufacturing plant, Sparrows Point Steel. There, it will produce components for its wind farm projects — potentially serving the whole East Coast in the future.
Producing more wind power is great news for Maryland residents since this energy source is clean and affordable. Texas residents save $20 million a day through a combination of wind and solar, and other states can start to tap into these energy sources, too.
At the same time, the more we rely on non-polluting clean energy, the less we’ll rely on oil and coal — energy sources that put toxic fumes and heat-trapping gases into the air, warming up the planet. We’re already starting to make the shift to relying on cleaner options.
Meanwhile, the mill itself is good news for residents. Such a huge manufacturing facility will supply jobs and bring money to the area, boosting the economy. Plus, according to Electrek, the remainder of the former Bethlehem Steel site is now being cleaned up, which is good for the environment.
“I’m a huge fan of adaptive reuse, and I’m also so excited by the revival of U.S. manufacturing in the EV and clean energy sectors due to the Biden administration’s Infrastructure Law and Inflation Reduction Act,” said Electrek’s Michelle Lewis about the project. “Sparrows Point Steel Mill won’t be as large as its predecessor, but it will be a welcome and positive rebirth for this long-abandoned site.”
Join our free newsletter for cool news and actionable info that makes it easy to help yourself while helping the planet.
NEW LONDON, Conn. — Off the coast of eastern Long Island, an 800-foot tall turbine has begun sending electricity onto the U.S. grid from what’s set to be the country’s first commercial offshore wind farm.
It’s a milestone many years in the making and at the same time a modest advance in what experts say needs to be a major buildout of this type of clean electricity to address climate change.
Danish wind energy developer Ørsted and the utility Eversource announced Wednesday the first electricity from what will be a 12-turbine wind farm called South Fork Wind 35 miles (56 kilometers) east of Montauk Point, New York. It will be New York’s first offshore wind farm.
Ørsted and Eversource met Wednesday with New York officials to celebrate this “first power” milestone, in East Hampton, New York, where the wind farm connects to the onshore electric grid. They say the achievement builds a foundation for other large U.S. offshore wind farms that will follow.
So far, two of the 11-megawatt turbines are up. The second is undergoing testing, then it can begin producing power too. When the other ten are spinning and South Fork opens by early next year, it will be able to generate 132 megawatts of offshore wind energy to power more than 70,000 homes.
The first power announcement is “an incredible moment in the American clean energy story,” said Stephanie McClellan, executive director of the nonprofit Turn Forward, which advocates for offshore wind. She said South Fork will be a source of clean, reliable, domestically-produced energy.
“This is just the beginning of what offshore wind can do,” she said in a statement.
Offshore wind is central to New York’s plan to transition to a carbon-free electricity system by 2040. The state aims to install 9 gigawatts of offshore wind by 2035.
“New York’s nation-leading efforts to generate reliable, renewable clean energy have reached a major milestone,” New York Gov. Governor Kathy Hochul said in a statement Wednesday. “South Fork Wind will power thousands of homes, create good-paying union jobs and demonstrate to all that offshore wind is a viable resource New York can harness for generations to come.”
Large offshore wind farms have been making electricity for three decades in Europe, and more recently in Asia. The first U.S. offshore wind farm was supposed to be a project off the coast of Massachusetts known as Cape Wind. The application was submitted to the federal government in 2001. It failed after years of local opposition and litigation.
Turbines began turning off Rhode Island’s Block Island in 2016. But with just five of them, it’s not a commercial-scale wind farm.
Currently there are two commercial offshore wind farms under construction in the United States, South Fork Wind and Vineyard Wind. Vineyard Wind will be a 62-turbine wind farm 15 miles (24 kilometers) off the coast of Massachusetts. It has not started generating power yet, the developer said Monday. They’re installing and testing five turbines first.
At State Pier in New London, Connecticut, blades and massive tower sections for South Fork are lined up, ready to leave port for the sea where they’ll be erected in the coming weeks. The nacelles that house the generator for each wind turbine are there, too.
On Monday, a barge carrying three blades and a nacelle for the third turbine left port. As Jeff Martin, of Eversource, watched, he said it was a “joy” to see the industry finally move from concept to fruition in the United States, to help reduce the nation’s dependence on fossil fuels.
“Finally we’re taking this step to catch up with the rest of the world and do our part to collectively address climate change,” said Martin, Eversource’s director of business development for the offshore wind group.
Large, ocean-based wind farms are a linchpin of government plans to shift to renewable energy in populous East Coast states with limited land for wind turbines or solar arrays. The Biden administration aims to power 10 million homes with offshore wind by 2030 and establish a carbon-free electric grid five years later.
But the industry has had hard times recently. Ørsted announced it’s cancelling two large offshore wind projects in New Jersey due to problems with supply chains, higher interest rates and a failure to obtain the amount of tax credits the company wanted. Developers in New England recently canceled power contacts too, saying their projects were no longer financially feasible. The series of setbacks for the nascent U.S. offshore wind industry jeopardizes the clean energy goals.
Other projects though, are advancing. Ørsted is moving forward with Eversource on construction of Revolution Wind, Rhode Island and Connecticut’s first utility-scale offshore wind farm. The 704-megawatt project will power roughly 400,000 homes. Tower sections, blades and nacelles are expected to begin arriving in New London as early as this spring.
South Fork and Revolution Wind are a “bright spot for a challenged industry,” said David Hardy, group executive vice president and CEO Americas at Ørsted.
“As we demonstrate that we can build this project and build Revolution, then people will realize the real opportunity of offshore wind,” he said.
___
Associated Press climate and environmental coverage receives support from several private foundations. See more about AP’s climate initiative here. The AP is solely responsible for all content.
WASHINGTON — The Air Force’s vast fields of underground nuclear missile silos are rarely disturbed by more than the occasional wandering cow or floating spy balloon. But the service is now asking Congress to help with another unexpected danger: towering wind turbines, which are growing in number and size and are edging closer to the sites each year.
The silos share space on vast private farmlands with the turbines. Whereas the nuclear launch sites are almost undetectable — just small, rectangular plots of land marked only by antennae, a chain-link fence and a flat 110,000-ton (100,000-metric tonne) concrete silo blast door — the turbines are hundreds of feet high, with long, sweeping blades that have parts so large and long they dwarf the 18-wheeler flatbed trucks that transport them to new sites.
As nearby populations have grown, so have energy needs, and so have the number and size of the turbines. It’s a boon for farmers and landowners, who can lease space on their lands to support both the military needs and wind power companies.
But the growth is making it dangerous for military helicopter crews. When an alarm triggers at a site, the UH-1 Huey crews fly in low and fast, often with security teams on board.
“When you think about a wind turbine, and even fields of wind turbines, they’ll stretch for miles,” said Staff Sgt. Chase Rose, a UH-1 Huey flight engineer at Malmstrom Air Force Base in Montana. “They’re monstrous, and then you have gigantic blades spinning on them as well. Not only is that a physical obstacle, but those turbines, they create the hazards like turbulence as well. That can be really dangerous for us to fly into. So it’s a very complex situation, when you have to deal with those.”
So the Air Force is asking Congress to pass legislation to create a 2-nautical-mile buffer zone around each site. The legislation has the support of wind energy advocates, but they caution against a one-size-fits-all approach. There are hundreds of underground silos spread across the U.S., in Nebraska, Colorado, North Dakota, Montana and Wyoming.
“The wind industry recognizes the nuclear missile silo mission is unique,” said Jason Ryan, a spokesman for the American Clean Power Association, which worked with the Air Force and lawmakers on drafting language for a buffer zone. “However, one-size-fits-all setbacks do not make sense for other (Department of Defense) missions or assets as site-specific and mission-specific evaluations are necessary to ensure military readiness.”
Jo Dee Black, a spokeswoman for NorthWestern Energy, which operates some of the towers near Malmstrom’s launch sites, did not say whether the firm is in support of the buffer zone but said “we have always and continue to support the critical role Malmstrom Air Force Base has in our nation’s security.”
“NorthWestern Energy and the U.S. Air Force have a long, successful history of collaboration that supports our missions of national security and providing safe, reliable energy service,” Black said.
Language to create a setback was included in the Senate version of the 2024 National Defense Authorization Act. The language is not in the House version of the bill and would need to be negotiated in conference.
Under the legislation, current towers would be unaffected, unless a company decided to refurbish an existing tower to make it taller.
That could still be a problem for the air crews. Some of the modern turbines have towers as tall as 650 feet, or nearly 200 meters, “which is twice the height of the Statue of Liberty,” Air Force Lt. Gen. John Lutton, who oversees all 450 missile silo sites, said earlier this year. Some rotor diameters, the width of the circle swept by the rotating blades, can be as much as 367 feet (112 meters), the distance from home plate to the left field pole at the Colorado Rockies’ baseball stadium.
Of the 450 sites, 46 are “severely” encroached upon, which the Air Force defines as having more than half of the routes to the launch site closed due to obstructions.
But the service acknowledges the difficult position it is in. The farmers who have allowed it to use their lands for decades benefit from the income from the turbine leases, and the service does not want to appear to push back on environmental energy alternatives.
The Air Force continues to “support renewable energy efforts to include wind turbines, and we continue to work with energy industry partners to ensure the country’s green energy needs are met,” said Air Force Maj. Victoria Hight, a spokeswoman for F.E. Warren Air Force Base in Wyoming. However, she said, “the encroaching turbines limit safe helicopter transit and nuclear security operations.”
WASHINGTON — The cancellation of two large offshore wind projects in New Jersey is the latest in a series of setbacks for the nascent U.S. offshore wind industry, jeopardizing the Biden administration’s goals of powering 10 million homes from towering ocean-based turbines by 2030 and establishing a carbon-free electric grid five years later.
The Danish wind energy developer Ørsted said this week it’s scrapping its Ocean Wind I and II projects off southern New Jersey due to problems with supply chains, higher interest rates and a failure to obtain the amount of tax credits the company wanted. Together, the projects were supposed to deliver over 2.2 gigawatts of power.
The news comes after developers in New England canceled power contacts for three projects that would have provided another 3.2 gigawatts of wind power to Massachusetts and Connecticut. They said their projects were no longer financially feasible.
In total, the cancellations equate to nearly one-fifth of President Joe Biden’s goal of 30 gigawatts of offshore wind power by 2030.
Despite the setbacks, offshore wind continues to move forward, the White House said, citing recent investments by New York state and approval by the Interior Department of the nation’s largest planned offshore wind farm in Virginia. Interior’s Bureau of Ocean Energy Management also announced new offshore wind lease areas in the Gulf of Mexico.
“While macroeconomic headwinds are creating challenges for some projects, momentum remains on the side of an expanding U.S. offshore wind industry — creating good-paying union jobs in manufacturing, shipbuilding and construction,″ while strengthening the power grid and providing new clean energy resources for American families and businesses, the White House said in a statement Thursday.
Industry experts now say that while the U.S. likely won’t hit 30 gigawatts by 2030, a significant amount of offshore wind power is still attainable by then, roughly 20 to 22 gigawatts or more. That’s far more than the nation has today, with just two small demonstration projects that provide a small fraction of a single gigawatt of power.
Large, ocean-based wind farms are the linchpin of government plans to shift to renewable energy, particularly in populous East Coast states with limited land for wind turbines or solar arrays. Eight East Coast states have offshore wind mandates set by legislation or executive actions that commit them to adding a combined capacity of more than 45 gigawatts, according to ClearView Energy Partners, a Washington-based research firm.
“I think very few people would argue that the U.S. will have the gigawatts the Biden administration wants″ by 2030, said Timothy Fox, a ClearView vice president. “But I do think eventually we will have it and will likely exceed it.”
Offshore wind developers have publicly lamented the global economic gales they’re facing. Molly Morris, president of U.S. offshore wind for the Norwegian company Equinor, said the industry is facing a “perfect storm.”
High inflation, supply chain disruptions and the rising cost of capital and building materials are making projects more expensive while developers are trying to get the first large U.S. offshore wind farms opened. Ørsted is writing off $4 billion, due largely to cancellation of the two New Jersey projects.
David Hardy, group executive vice president and CEO Americas at Ørsted, said it’s crucial to lower the levelized cost of offshore wind in the United States so Americans aren’t debating between affordability and clean energy. Hardy spoke at the American Clean Power industry group’s offshore wind conference in Boston last month on a panel with Morris.
“We’re probably a little bit too ambitious,” he said. “We came in hot, we came in fast, we thought we could build projects that were inexpensive, large projects right out of the gate. And it turns out that we probably still need to go through the same learning curve that Europe did, with higher prices in the beginning and a little slower pace.”
In May, there were 27 U.S. offshore wind projects that had negotiated agreements with states to provide power before the brunt of the cost increases hit, according to Walt Musial, offshore wind chief engineer at the National Renewable Energy Laboratory, an arm of the Energy Department. The delay between signing purchase agreements and getting final approval to build allowed unexpected cost increases to render many projects economically unfeasible, he said.
Musial called Ørsted’s announcement a setback for the industry but “not a fatal blow by any means.”
On Tuesday, the Biden administration announced approval of the nation’s largest offshore wind project. The Coastal Virginia Offshore Wind project will be a 2.6 gigawatt wind farm off of Virginia Beach to power 900,000 homes. And even as Ørsted announced the New Jersey cancellations, it said it was investing with utility Eversource to move forward with construction of Revolution Wind, Rhode Island and Connecticut’s first utility-scale offshore wind farm, a 704-megawatt project.
The current outlook from S&P Global Commodity Insights is 22 gigawatts by 2030, though that will be revised due to the recent industry announcements.
New York state, meanwhile, recently announced the award of 4 gigawatts of offshore wind capacity as it seeks to obtain 70% of its electricity from renewable sources by 2030 and 9 gigawatts of offshore wind by 2035. That announcement came shortly after New York regulators rejected a request for bigger payments for four offshore wind projects worth a combined 4.2 gigawatts of power. Those developers said they were assessing the viability of their projects.
Any delay in offshore wind means continued reliance on fossil fuel-burning power plants, according to environmental advocates.
“The quicker they come online, the quicker our air quality improves,” said Conor Bambrick, director of policy for Environmental Advocates NY.
New Jersey, under Democratic Gov. Phil Murphy, has established increasingly stringent clean energy goals, moving from 100% clean energy by 2050 to 100% by 2035. Murphy cast Ørsted’s decision as “outrageous” and an abandonment of its commitments, but the two-term Democrat said New Jersey plans to move forward with offshore wind. Additional offshore projects are pending before the state’s utility regulators.
“We definitely remain optimistic,” said Catherine Klinger, Murphy’s climate action and green economy executive director. “Offshore wind is a lot bigger than Ørsted.”
The first U.S. commercial-scale offshore wind farms are currently under construction: Vineyard Wind off Massachusetts and South Fork Wind off Rhode Island and New York.
Catherine Bowes, a senior director at Turn Forward, a nonprofit that advocates for offshore wind, believes the industry still has strong momentum because of the quality of the wind resources off the coastlines and the growing demand for clean electricity to meet decarbonization goals. The nonprofit is advocating for 100 gigawatts of U.S. offshore wind power.
“The bumpiness we’re seeing right now in no way indicates an inability of offshore wind to play a major role in the U.S. electric grid,″ Bowes said Thursday.
Terminated contracts can be rebid, presumably with higher prices to cover development costs. Offshore wind developers are asking the federal government to ensure the industry can take advantage of tax credits under the Inflation Reduction Act to help these first projects become operational.
Michael Brown, CEO of Ocean Winds North America, which is developing several offshore projects, including one in New Jersey, said at the clean power conference that the industry will thrive in the U.S. but “it might be a little bit slower than we all want it.”
___
McDermott reported from Providence, Rhode Island; Hill from Albany, New York and Catalini from Trenton, New Jersey.
___
Associated Press climate and environmental coverage receives support from several private foundations. See more about AP’s climate initiative here. The AP is solely responsible for all content.
UPPER TOWNSHIP, N.J. — For decades, tourists heading to the New Jersey beach resorts of Ocean City and Cape May saw the towering smokestack of the B.L. England Generating Station as they zipped past it on the Garden State Parkway.
The 463-foot-tall (141.1-meter) stack was a local landmark and even a weather forecaster for some residents who glanced outside to see which way emissions from its top were blowing, and how fast, as they decided what to wear for the day.
But the power plant, which burned coal and oil over the decades, closed in May 2019, a casualty of the global move away from burning fossil fuels.
And the smokestack, the last major remaining piece of the plant, was imploded Thursday morning, brought down by 350 pounds of explosives strategically placed by a demolition company known in the area for razing the former Trump Plaza casino in nearby Atlantic City in 2021.
At 10 a.m., as a crowd of over 100 onlookers watched from a nearby pier and additional spectators on at least 50 boats moored a safe distance away in the bay took in the spectacle, a loud boom rang out, followed by two smaller ones, and the stack quickly tilted away from the water and collapsed in a cloud of dust.
“Everything went as we had planned: it fell exactly the way we expected it to,” said Chad Parks, a spokesman for the property owner Beesley’s Point Development Group, a New York company that says it specializes in redeveloping “distressed” heavy industrial sites.
Two smaller structures, a gypsum silo and part of the former power plant, will be torn down using ground-based heavy equipment.
The demolition clears the way for the waterfront site on Great Egg Harbor Bay to enter its next role in providing energy to New Jerseyans: As the connection point for several of the state’s planned offshore wind farms. It also will house a mixed use development likely to include a hotel, a marina, restaurants, shops and residential housing units.
Because the power plant already had connections to the electrical grid, much of the infrastructure to plug offshore wind into the power system already exists in a nearby substation, making it a logical site to bring the offshore wind power onshore.
A cable from the first such wind farm, to be built by energy company Orsted, will come ashore on a beach in Ocean City, run underground along a roadway right-of-way before re-entering the waters of the bay and finally connecting to the grid at the former B.L. England site.
That route, and the very existence of the project itself, has generated significant opposition from residents in Ocean City and other Jersey Shore communities, who are fighting them in court and in the court of public opinion.
The power plant opened in 1961. A cooling tower there was demolished in September 2022, and boilers at the site were demolished in April.
___
Follow Wayne Parry on X, formerly known as Twitter, at www.twitter.com/WayneParryAC
Siemens Energy AG is in talks with the German government about securing as much as €16 billion ($16.9 billion) in state guarantees as problems at its wind-turbine unit spread to the rest of the business. Shares plummeted 40%.
The company is seeking backstops over a two-year period after major shareholder and former parent company Siemens AG indicated it was no longer willing to help, according to people familiar with the matter. The company said Thursday it’s also speaking to banks, and the government confirmed the talks.
Siemens Energy needs the guarantees to win new large-scale contracts to build transmission networks and gas turbines. While those units are profitable, they’re now threatened by the strain that the string of losses from the Gamesa wind unit is putting on the company’s balance sheet in what has become one of Germany’s biggest industrial debacles.
The guarantees have become crucial after the company earlier this year forecast a €4.5 billion loss for fiscal 2024 despite assurances it had finally come up with a plan to address problems with certain wind turbines. S&P in July downgraded it to BBB-minus with a stable outlook from BBB with a negative outlook.
While the company has been working on a broad review of the turbine unit, final findings have yet to come through.
Siemens Energy shares took their the biggest intraday drop since the company was spun out of Siemens in September 2020. The slump triggered multiple trading halts and cut the manufacturer’s market capitalization by around €3.4 billion. It was the biggest drop for a stock listed on Germany’s DAX index since the collapse of Wirecard in June 2020.
The paper value of Siemens AG’s stake was cut by more than €800 million. Its shares fell as much as 5.9%.
“Siemens is now in close and continuous talks with all parties involved,” the company said in a statement. “As we have always said, we will make our decisions in line with the interests of Siemens AG and its shareholders.”
Siemens Energy doesn’t have acute liquidity problems, according to the people familiar with the talks. But the guarantees are important for securing the financing it needs for longer term projects, particularly in its gas and power division.
“We are therefore initiating measures to strengthen our balance sheet and are in talks with the German government on how to secure guarantee structures in the fast-growing energy market,” Siemens Energy spokesman Oliver Sachgau said.
Economy Minister Robert Habeck, speaking in Ankara, said the talks are “good and constructive.”
“We have already been talking intensively since Siemens Energy made this public and contacted us, and we have increased this intensity in the last 2 weeks,” Habeck said.
The company still has €110 billion in back orders. Germany’s RWE AG plans to build over 1 gigawatt of onshore wind farms with Siemens Gamesa turbines in the next four years, but declined to comment on whether the projects can still be carried out as planned.
Net losses and cash outflow are now expected to exceed market forecasts for the year, the manufacturer said.
Citi analysts led by Vivek Midha said uncertainty about the fourth quarter remains “very high.”
“The magnitude of the shortfall to estimates is unspecified, though clearly if it were minor, it is unlikely that it would have been flagged,” they said in a note. “Even if ENR has no near-term liquidity issue, the comment around measures to strengthen balance sheet is broad, meaning that investor concerns around an equity raise are likely to intensify.”
— With assistance by Eyk Henning, Kamil Kowalcze, Jan-Patrick Barnert, Joe Easton, and Allegra Catelli
Wind turbines and a lignite-fired power plant photographed in in Germany.
Jan Woitas | Picture Alliance | Getty Images
Demand for oil, coal and natural gas is set to peak before the end of this decade, with fossil fuels’ share in the world’s energy supply dropping to 73% by the year 2030 after being “stuck for decades at around 80%,” the International Energy Agency said Tuesday.
A transformative shift in how the planet is powered is also underway, with the “phenomenal rise of clean energy technologies” like wind, solar, heat pumps and electric cars playing a crucial role, according to a statement accompanying the IEA’s World Energy Outlook 2023 report.
Energy related carbon dioxide emissions are also on course to peak by the year 2025.
Despite these seismic shifts, the IEA says more effort is required to limit global warming to 1.5 degrees Celsius, a key goal of the Paris Agreement on climate change.
The IEA’s analysis of governments’ “current policy settings” shows the world’s energy system is on course to look very different in the next few years.
In its statement, the Paris-based organization said it sees “almost 10 times as many electric cars on the road worldwide” in 2030, with “renewables’ share of the global electricity mix nearing 50%,” higher than the roughly 30% today.
Among other things, heat pumps — as well as other electric heating systems — are on course to outsell boilers that use fossil fuels.
“If countries deliver on their national energy and climate pledges on time and in full, clean energy progress would move even faster,” the IEA’s statement said.
“However, even stronger measures would still be needed to keep alive the goal of limiting global warming to 1.5 °C,” it added.
“As things stand, demand for fossil fuels is set to remain far too high to keep within reach the Paris Agreement goal of limiting the rise in average global temperatures to 1.5 °C,” the statement went on to say.
In a sign of how high the stakes are, the IEA’s report said its Stated Policies Scenario was now “associated with a temperature rise of 2.4 °C in 2100 (with a 50% probability).”
Read more about electric vehicles, batteries and chips from CNBC Pro
Tuesday’s report reaffirms the content of an op-ed published in September 2023 that was authored by the IEA’s executive director, Fatih Birol, and published in the Financial Times.
In remarks published Tuesday, Birol sought to emphasize the huge potential for change while also highlighting the massive amount of work that still needs to be done.
“The transition to clean energy is happening worldwide and it’s unstoppable,” he said. “It’s not a question of ‘if’, it’s just a matter of ‘how soon’ — and the sooner the better for all of us,” he added.
“Governments, companies and investors need to get behind clean energy transitions rather than hindering them,” Birol said.
“There are immense benefits on offer, including new industrial opportunities and jobs, greater energy security, cleaner air, universal energy access and a safer climate for everyone.”
“Taking into account the ongoing strains and volatility in traditional energy markets today, claims that oil and gas represent safe or secure choices for the world’s energy and climate future look weaker than ever,” Birol said.
The IEA’s report comes just weeks ahead of the U.N.’s COP28 climate change summit in the United Arab Emirates.
The shadow of the Paris Agreement, reached at COP21 in late 2015, looms large over the IEA’s report.
The landmark accord aims to “limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”
The challenge is huge, and the United Nations has previously noted that 1.5 degrees Celsius is viewed as being “the upper limit” when it comes to avoiding the worst consequences of climate change.
FRANKFURT, Germany — Stalled spending on electrical grids worldwide is slowing the rollout of renewable energy and could put efforts to limit climate change at risk if millions of miles of power lines are not added or refurbished in the next few years, the International Energy Agency said.
The Paris-based organization said in the report Tuesday that the capacity to connect to and transmit electricity is not keeping pace with the rapid growth of clean energy technologies such as solar and wind power, electric cars and heat pumps being deployed to move away from fossil fuels.
IEA Executive Director Fatih Birol told The Associated Press in an interview that there is a long line of renewable projects waiting for the green light to connect to the grid. The stalled projects could generate 1,500 gigawatts of power, or five times the amount of solar and wind capacity that was added worldwide last year, he said.
“It’s like you are manufacturing a very efficient, very speedy, very handsome car — but you forget to build the roads for it,” Birol said.
If spending on grids stayed at current levels, the chance of holding the global increase in average temperature to 1.5 degrees Celsius above pre-industrial levels — the goal set by the 2015 Paris climate accords — “is going to be diminished substantially,” he said.
The IEA assessment of electricity grids around the globe found that achieving the climate goals set by the world’s governments would require adding or refurbishing 80 million kilometers (50 million miles) of power lines by 2040 — an amount equal to the existing global grid in less than two decades.
Annual investment has been stagnant but needs to double to more than $600 billion a year by 2030, the agency said.
It’s not uncommon for a single high-voltage overhead power line to take five to 13 years to get approved through bureaucracy in advanced economies, while lead times are significantly shorter in China and India, according to the IEA.
The report cited the South Link transmission project to carry wind power from northern to southern Germany. First planned in 2014, it was delayed after political opposition to an overhead line meant it was buried instead. Completion is expected in 2028 instead of 2022.
Other important projects that have been held up: the 400-kilometer (250-mile) Bay of Biscay connector between Spain and France, now expected for 2028 instead of 2025, and the SunZia high-voltage line to bring wind power from New Mexico to Arizona and California. Construction started only last month after years of delays.
On the East Coast, the Avangrid line to bring hydropower from Canada to New England was interrupted in 2021 following a referendum in Maine. A court overturned the statewide vote rejecting the project in April.
The Jan De Nul Group’s Voltaire in waters off China in Dec. 2022. As wind turbines get bigger, the vessels that install them are having to change, too.
Located in the North Sea, over 130 kilometers off England’s northeast coast, the Dogger Bank Wind Farm still has some way to go before it’s fully operational, but the installation and powering up of its first turbine is a major feat in itself.
That’s because GE Vernova’s Haliade-X turbines stand 260 meters tall — that’s higher than San Francisco’s Golden Gate Bridge — and have blades measuring 107 meters.
Turbine installation at Dogger Bank has required a huge amount of planning and preparation, with the Voltaire — a specialist vessel designed and built by the family-owned Jan De Nul Group — playing a key role.
With a lifting capacity of 3,200 metric tons, the Voltaire — named after the 18th-century French philosopher — will have installed a total of 277 Haliade-X turbines when its work is complete.
This image, from Dec. 2022, shows Jan De Nul Group’s Voltaire in China. A specialist installation vessel, the Voltaire has a lifting capacity of over 3,000 metric tons.
VCG | Visual China Group | Getty Images
Described by Dogger Bank as the “largest offshore jack-up installation vessel ever built,” in many ways, it’s the pinnacle of an extensive supply chain involving numerous businesses and stakeholders.
The logistics are complex and multi-layered, with water depth a particular issue.
The sea in the Dogger Bank Offshore Development Zone is up to 63 meters deep, meaning the Voltaire’s ability to work in deeper waters is crucial.
This is where its four legs come into play.
According to Jan De Nul, the legs of the Voltaire — which was built at the COSCO Shipping Shipyard in China — enable it to lift itself above the water’s surface.
With each leg measuring roughly 130 meters in length, they highlight the scale of equipment required to install huge offshore wind turbines like GE’s Haliade-X.
In an online Q&A before installations at Dogger Bank began, Jan De Nul’s Rutger Standaert spoke of their importance. “Thanks to those legs, the Voltaire can effectively operate at a water depth of 80 meters,” Standaert, who is manager of vessel construction at the business, said.
He noted that the Voltaire’s capabilities would enable installations further out to sea, allowing it to play a key role in the emerging floating offshore wind sector.
“Off the Scottish coast, for example, expensive floating windfarms are often the only way to tap into offshore wind,” he said. “The water is too deep for fixed windfarms, but the Voltaire can offer new opportunities.”
Thinking big
Once completed, the Dogger Bank Wind Farm will have a total capacity of 3.6 gigawatts (GW) and be able to power as many as six million homes per year, according to its developers.
Work on the project is taking place over three phases: Dogger Bank A, B, and C. A fourth phase of the wind farm known as Dogger Bank D has also been proposed, and would increase its capacity even further.
Read more about electric vehicles, batteries and chips from CNBC Pro
Søren Lassen is head of offshore wind research at Wood Mackenzie, a research and consultancy group. He described Dogger Bank as “a huge project, especially if you combine the three phases.”
“It is a project that requires a lot of preparation,” he told CNBC. “There’s the logistics in terms of having the vessels to do the installation … and then of course, you also have the logistics in terms of getting the components to the marshaling port.”
Both of these aspects were being made “a lot more complicated” by the use of next-generation turbines and a next-generation installation vessel, Lassen said.
“You have … a lot of innovation that goes into this. And not only do you need a new vessel or new components, you also need new factories to build those components.”
As such, a slew of upgrades and adjustments were needed to “reverberate throughout the entire value chain” for operations to run smoothly, he added.
Bigger turbines, bigger challenges?
This image, from June 2023, shows tower sections of GE’s Haliade-X wind turbine at a site in the U.S.
David L. Ryan | The Boston Globe | Getty Images
Thanks to their sheer size, larger turbine designs have created a specific set of needs for the offshore wind sector and sites like the Dogger Bank Wind Farm.
“From cranes to vessels, we use a number of specially designed pieces of equipment to transport the Haliade-X turbines that will be used in this project,” a spokesperson for GE Offshore Wind said in a statement sent to CNBC.
Wood Mackenzie’s Lassen stressed the importance of having dedicated transportation vessels, noting that the towers of turbines need to be broken into three or four sections in order to fit on board.
Massive blades represent the biggest challenge, he said, as they have to be laid flat. “And that just means that you need a very, very long transportation vessel, [and] that you need to stack them up accordingly.”
Blades of the Haliade-X turbine stacked on top of each other at a site in the U.S. The past few years have seen companies develop increasingly large wind turbines.
David L. Ryan | The Boston Globe | Getty Images
Meanwhile, delays or bottlenecks can have far-reaching — and expensive — consequences.
Lassen cited the example of blades not being delivered on time, which leads to vessels having to “go away and then come back half a year later to do the installation. This is very costly, of course.”
And delays also lead to lost revenue.
“These projects are going out [and] generating a lot of power from the day that they’re being installed, pretty much,” Lassen added.
“So any delays [and] you’re also losing a lot of revenue, especially right now when the power prices are really, really high.”
The bigger picture
Offshore wind farms are set to play a significant role in reducing emissions and hitting net zero goals in the years ahead — but a supply chain that’s well-run and reliable will be key to the industry’s success.
This is set to cost serious money. According to Wood Mackenzie, a base case of 30 GW of installations per year by 2030 — excluding China — will require investment of around $27 billion by 2026 to build out supply chains.
“The supply chain needs to invest,” Lassen said, adding that it also needed capital, certainty and concrete, firm orders. However, cost pressures mean there is currently uncertainty over projects planned for 2025, 2026 and 2027.
“Any delays to these projects takes away volume from the supply chain, and the supply chain needs that volume to convert it into revenue to build new factories,” Lassen explained.
It is crucial that projects planned for the next few years go ahead, he added. “That helps the underlying supply chain ramp up so they can build the capacity [for] ’27, ’28, ’29 and well into the 2030s as well.”
WASHINGTON — WASHINGTON (AP) — President Joe Biden’s administration on Friday proposed up to three oil and gas lease sales in the Gulf of Mexico, but none in Alaska, as it tries to navigate between energy companies seeking greater oil and gas production and environmental activists who want Biden to shut down new offshore drilling in the fight against climate change.
The five-year plan includes proposed sales in the Gulf of Mexico — the nation’s primary offshore source of oil and gas — in 2025, 2027 and 2029. The three lease sales are the minimum number the Democratic administration could legally offer if it wants to continue expanding offshore wind development.
Under the terms of a 2022 climate law, the government must offer at least 60 million acres of offshore oil and gas leases in any one-year period before it can offer offshore wind leases.
The provision tying offshore wind to oil and gas production was added by Democratic Sen. Joe Manchin of West Virginia, a top recipient of oil and gas donations and a key vote in favor of the climate law, which was approved with only Democratic votes in Congress. The landmark law, the Inflation Reduction Act, was signed by Biden as a key step to fight climate change but includes a number of provisions authored by Manchin, a centrist who represents an energy-producing state.
For instance, if the Biden administration wants to expand solar and wind power on public lands, it must offer new oil and gas leases first.
“The Biden-Harris administration is committed to building a clean energy future that ensures America’s energy independence,” Interior Secretary Deb Haaland said in a statement. The proposed offshore leasing program “represents the smallest number of oil and gas lease sales in history” and “sets a course for (the Interior Department) to support the growing offshore wind industry,” she said.
The lease program will guard against environmental damage caused by oil and gas drilling and other adverse impacts to coastal communities, Haaland said.
If completed, the sales would increase climate-changing greenhouse gas emissions, according to a 300-page environmental review by the Interior Department’s Bureau of Ocean Energy Management. How much they will increase is uncertain because the review considered five or 10 new sales but not the three sales proposed.
Manchin sharply criticized the announcement and said limiting oil and gas sales would result in fewer renewable energy leases under the terms of the climate law.
“You can’t have one without the other,” he said. “It makes no sense at all to actively be limiting our energy production.”
Still, the plan allows drillers such as Chevron, BP and ExxonMobil to participate in as many as three oil and gas auctions over the next five years, a top priority for the industry that could lock in decades of offshore oil and gas production.
The plan goes against Biden’s campaign promise to end new offshore drilling and could become a political liability for the Democratic president, who already faces sharp opposition from environmental groups angry at his decision earlier this year to approve ConocoPhillips’ massive Willow oil project in Alaska.
ConocoPhillips CEO Ryan Lance called Willow “the right decision for Alaska and our nation.” But environmental groups call the $8 billion project a “carbon bomb” that would betray Biden’s pledge to cut planet-warming greenhouse gas emissions in half by 2030. Opponents mounted a #StopWillow campaign on social media that has been seen hundreds of millions of times.
Dyani Chapman, the director of Alaska Environment, said she was pleased that the final plan removes a proposed Alaska lease sale from a draft version. “This is a positive wave for the belugas, otters and salmon up here, but the coast isn’t clear,” she said. “Climate change means that any more drilling anywhere can still create problems in a warming Alaska.”
Interior Deputy Secretary Tommy Beaudreau said the administration’s options were limited by the climate law.
“The (oil leasing) program is definitely informed by the IRA and the connection that the IRA makes between offshore oil and gas leasing and renewable energy leasing,” he said Thursday, referring to the Inflation Reduction Act.
The Interior Department can’t sell the rights to drill for oil and gas offshore without first publishing a schedule that outlines its plans. The administration faced a Saturday deadline to release the five-year plan.
At least two sales have been held most years over the past several decades under the federal offshore leasing program, which was established in the 1950s. While Friday’s decision means fewer sales, it will take years for oil production to be affected because companies can take up to 15 years to start drilling once a lease is awarded, said energy analyst Rene Santos, of S&P Global Commodity Insights.
Over the long term, Santos said, that could help drive companies to other countries, such as Brazil and Guyana, where the governments are more open to drilling.
Environmentalists said the leasing will worsen climate change impacts and leave coastal communities in Louisiana and other states exposed to spills that occur regularly in the Gulf of Mexico. Beth Lowell, with the group Oceana, said Biden’s proposal was “showing the world that it’s OK to prioritize polluters over real climate solutions.”
Any individual sales held under the proposal will likely face legal challenges. “We will continue to work alongside Gulf Coast communities to challenge new leasing and transition beyond a fossil economy that is poisoning people and driving climate change,” Earthjustice president Abigail Dillen said in a statement.
The oil industry and its allies have called for more leasing, not less.
The American Petroleum Institute, the top lobbying group for the oil and gas industry, said Biden was “choosing failed energy policies that are adding to the pain Americans are feeling at the pump.”
Sen. Dan Sullivan, R-Alaska, said Biden’s announcement was “an affront to working Americans who are struggling to pay their bills as this administration continues its dangerous crusade to appease radical activists and shut down American energy.”
At the last lease sale, in March, companies including Chevron, BP and ExxonMobil bid $264 million for drilling rights in the Gulf, a sharp rise from the previous auction in 2021.
___
Brown reported from Billings, Mont. Associated Press writer Becky Bohrer in Juneau, Alaska, contributed.
The Hywind Tampen project is located in waters off the Norwegian coast.
Ole Berg-rusten | AFP | Getty Images
A facility described as “the world’s largest floating offshore wind farm” was officially opened by Crown Prince Haakon of Norway on Wednesday, marking the culmination of a major renewable energy project years in the making.
Located around 140 kilometers (86.9 miles) off the coast of Norway in depths ranging from 260 to 300 meters, Hywind Tampen uses 11 turbines. The wind farm produced its first power in Nov. 2022 and became fully operational this month.
While wind is a renewable energy source, Hywind Tampen helps power operations at oil and gas fields, the idea being that it will cut these sites’ carbon dioxide emissions in the process.
“Hywind Tampen has a system capacity of 88 MW and is expected to cover about 35 per cent of the annual need for electricity on the five platforms Snorre A and B and Gullfaks A, B and C,” Norwegian energy firm Equinor said.
Stock picks and investing trends from CNBC Pro:
Floating offshore wind turbines are different from fixed-bottom offshore wind turbines, which are rooted to the seabed. One advantage of floating turbines is that they can be installed in far deeper waters than fixed-bottom ones.
In recent years a range of companies and major economies like the U.S. have laid out goals to ramp up floating wind installations.
Equinor, a major player in the fossil fuel industry, describes the turbines at Hywind Tampen as being “mounted on floating concrete structures with a common anchoring system.”
Alongside Equinor, partners in the Hywind Tampen project include Vår Energi, INPEX Idemitsu, Petoro, Wintershall Dea and OMV.
The project off Norway’s coast marks Equinor’s latest move in the floating wind sector. Back in 2017, it started operations at Hywind Scotland, a five-turbine, 30 MW facility it calls the planet’s first floating wind farm.
“With Hywind Tampen, we have shown that we can plan, build and commission a large, floating offshore wind farm in the North Sea,” Equinor’s Siri Kindem, who heads up the firm’s renewables business in Norway, said in a statement.
“We will use the experience and learning from this project to become even better,” she added. “We will build bigger, reduce costs and build a new industry on the shoulders of the oil and gas industry.”
Powering the oil and gas industry
The use of a floating wind farm to help power the fossil fuel industry is likely to spark significant debate at a time when discussions about climate change and the environment are at the front and center of many people’s minds.
This is because fossil fuels’ effect on the environment is considerable. The United Nations says that, since the 19th century, “human activities have been the main driver of climate change, primarily due to burning fossil fuels like coal, oil and gas.”
“Burning fossil fuels generates greenhouse gas emissions that act like a blanket wrapped around the Earth, trapping the sun’s heat and raising temperatures,” it adds.
The stakes are high. Speaking at the COP27 climate change summit in Sharm el-Sheikh, Egypt, last year, the U.N. Secretary General issued a stark warning to attendees.
“We are in the fight of our lives, and we are losing,” Antonio Guterres said.
“Greenhouse gas emissions keep growing, global temperatures keep rising, and our planet is fast approaching tipping points that will make climate chaos irreversible.”
Currently, the U.S. produces only enough offshore wind energy to power about 32,000 homes. However, the White House wants to increase that to 10 million homes by 2030, and says that offshore wind energy will eventually create 44,000 jobs. Ben Tracy has more in “Eye on America.”
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
Off the coast of Grimsby, England, more than 300 wind turbines produce electricity to help power over 2 million homes a day. Sharyn Alfonsi reports on how the turbines work and how the project has been received.
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
Last August, President Biden signed a sweeping climate bill into law, making wind power a priority. specifically, offshore wind power.
The goal is to capture the force of the wind in the open seas and convert it into power for 10 million American homes by 2030.
We have a long way to go. There are only seven offshore wind turbines off the coast of the United states compared to nearly 6,000 in Europe.
Critics say they are expensive to build and maintain — unpredictable and ugly.
We wanted to see for ourselves. Last October, we went to the largest offshore wind farm in the world, along the northeast coast of England to discover the power of Grimsby.
As you fly 200 miles north of London, along the coast, you can see the town of Grimsby below. 55 miles east of her port, you can’t miss them. Elegant and a little erie, white giants poking out of the North Sea like something out of a science fiction novel.
Hornsea Wind Farm
This is the largest crop of offshore wind turbines in the world – known as the Hornsea Wind Farm. It is hypnotizing. More than 300 turbines spread across 335 square miles generate enough electricity to help power more than 2 million homes a day.
To understand the power, size and upkeep of this evolving technology, we geared up on land and traveled 90 minutes on the heaving North Sea with 24-year-old Bridie Salmon. Her job is to scale and service the turbines. My job, with the help of a little anti-nausea gum was to simply, hold down my lunch.
Sharyn Alfonsi: This is choppy out here.
Bridie Salmon: Yeah. It is. How are you feeling?
Sharyn Alfonsi: I feel– okay. It’s more important “How do you feel?”
Bridie Salmon: Yeah, I’m doing good. Like I say, I’d like to think I’ve got my sea legs on.
When your last name is Salmon, negotiating rough waters is sort of in your DNA. Bridie’s great-grandfather worked on the Grimsby docks. Her dad owns a 100-year-old smoked fish shop in town.
Bridie was bartending when she decided to apply to an apprentice program to be a turbine technician. She was one of seven people selected from a pool of 500.
The apprentice program combines classroom instruction – with hands-on work at sea. But we soon learned that mother nature is a tempermental teacher.
Correspondent Sharyn Alfonsi speaks with Bridie Salmon.
Sharyn Alfonsi: The weather here is ever-changing.
Bridie Salmon: Yeah, yeah, we’re holdin’ on for our dear lives. Yeah, I mean– and it is the North Sea. This is not something we can control. So every day is different. And it can change like that. So it’s just part and parcel of the job. Anything to get these things turning. This is the environment for wind turbines. It’s gotta be windy.
As we approached the turbines, we suddenly felt small.
Sharyn Alfonsi: You don’t get a sense of how large things are until you’re right up under them–
Bridie Salmon: Yeah, well, that’s it. I mean, so at very top, the nacelle– all the way to the top of the blades is half the size of the Eiffel Tower, which is pretty massive, it is. And because you’ve got nothing normal to compare it to like a building, you just see these in the distance. And then you’re here. And it’s– yeah, they’re pretty bloody huge.
Translation: they’re nearly 600 feet high with spinning fiberglass blades roughly the length of the world’s largest passenger jet. Each blade weights almost 30 tons.
The turbines are partially assembled on shore, then shipped out to sea where each blade is attached with surgical precision to the top of the turbine. Every angle has to be perfect to generate maximum power.
Once installed, keeping them spinning is critical. Offshore wind engineers say one revolution can power one home in the U.K. for 24 hours. And that’s where Bridie comes in.
Sharyn Alfonsi: It’s raining, it’s windy…
Bridie Salmon: Can’t wait. Just another day at the office!
In choppy waters, Captain Peter Broughton has to find the ‘sweet spot,’ maintaining constant contact between the bow and base. Some days the winds are so high and seas so rough, the job can’t be done.
On this day, success. Bridie harnesses herself to a cable, leaps to a ladder, and begins the climb rung by rung, eight stories to the top.
On a narrow platform hanging over the north sea, she makes her rounds, carefully inspecting and servicing the turbine. A job, not for the faint of heart.
Sharyn Alfonsi: What was that like the first time you made that climb?
Bridie Salmon: Oh, exhausting. Exhausting. Because you’ve got all your safety kit on as well so
you’ve probably got about ten kilograms of harnesses and claws and you’ve got to be clipped in so you’ve got that friction of climbing.
Sharyn Alfonsi: I imagine it would be kind of scary.
Bridie Salmon: Yeah, really scary. I remember there was one day it was super windy. So we were up there. And the top of the tower is moving. So, you’ve got the sea sickness, the motion sickness from the sea, and then the top of the tower’s moving. So, all day, you’re rocking. And it was cold and windy and I remember coming back onshore, and I was just rocking. I was, like, “I’m on land now. I don’t need to rock.” But it’s– yeah, it’s pretty scary.
Benj Sykes
Benj Sykes says those kinds of extraordinary efforts are needed in extraordinary times. Sykes is the vice president of offshore wind at Orsted, a Danish-based global energy supplier that runs the Hornsea Wind Farm.
Benj Sykes: You know we have a cost of energy crisis in Europe and in Britain at the moment. That’s driven by the pandemic but also of course by the terrible situation in Ukraine. And all that adds up to a real drive to find clean, cheap energy solutions.
About six years ago, Orstead decided to sell off it’s oil and gas business and focus on renewable energies. Grimsby, a depressed fishing town, became the unlikely backdrop to Europe’s clean energy movement.
Sharyn Alfonsi: Why here? Why Grimsby?
Benj Sykes: It’s got a good port. And it’s geographically really well located. Physically in terms of the water depth, in terms of the wind resource and of course places to connect to the national grid so that we can get that power to homes and businesses.
Long before Russia’s invasion of Ukraine set off the energy crisis, the U.K. had a strategy to use 100% clean or renewable electricity by 2035.
Sharyn Alfonsi: When you talk about clean energy, you talk about solar, hydro power, bio fuels. What makes offshore wind unique?
Benj Sykes: Offshore wind is really the only project in most countries where you can build it at the kind of power-station scale that we need. If I think about the projects we’re building here in the UK. That’s almost 3 gigawatts. That’s broadly speaking, the output of a nuclear power station. So, we’re talking large-scale infrastructure projects. Most of Europe is too populated, to fit very very large wind farms or solar farms. So that’s why we’ve gone offshore.
Sharyn Alfonsi: One big criticism is cost. They’re expensive to construct, to transmit and to decommission. Is that cost passed on to consumers.
Benj Sykes: So that’s simply wrong. Offshore wind power is one of the cheapest forms of electricity generation in the U.K. We privately fund it together with investment partners that we bring in.
Sharyn Alfonsi: Privately, you fund that.
Benj Sykes: Yeah. There’s no public exposure to the costs of building offshore wind. And I think the thing that has made the most difference is the fact that we’ve had political consensus now for more than a decade and that’s given investors confidence to step in and put the big money on the table to get these projects away.
Gas and nuclear still make up a majority of the power supply flowing into U.K. homes and businesses, but this year 14% of Britain’s energy has come from offshore wind. Only China produces more offshore wind power than the U.K.
Here’s how it works. Wind turns the blades around a shaft inside the turbine which spins a generator. Energy then travels down, going 300 feet beneath the water’s surface to cables buried under the seabed – connecting to an offshore substation.
Then, to a power station on land where that electricity created out at sea is transferred into homes and businesses, inviting the question, what happens if the wind stops blowing?
Benj Sykes: Using satellites and other technology we can predict extremely accurately how much we’re going to generate over the next days which enables those who operate the grid to make very clear plans about where demand is going, where supply is going. I mean, if I look at the turbines that we have out in Hornsea, they are operating 98-99% of the time.
This is Grimsby’s second act. Through the 1950s to 1970 the town hosted the largest fishing fleet in the world, with 700 trawlers, awash in cash and a port fit for a visit from the queen.
Dennis Avery: It was absolutely brilliant the camaraderie of it because you can say nearly 100% of the population would be associated with the fishin’ industry in some way.
Dennis Avery and Bob Formby were part of the town’s fishing tradition.
Dennis Avery and Bob Formby
Sharyn Alfonsi: what was it like?
Bob Formby: It’s a tough job. It’s work from sailing till you get back in the port again. Working in the winter around Iceland and them places was pretty severe. But it’s the kind of job that I’d do again tomorrow.
Dennis Avery: In those days You had two choices: you worked on the docks, or you went to sea.
Avery captained this hulking steel fishing trawler, the Ross Tiger, for eight years.
Dennis Avery: If you caught a good trip, and you steam back to Grimsby with a fish room full of fish, you know it’s a marvelous feeling.
That marvelous feeling ended when Iceland – Britain’s neighbor to the north – began enforcing fishing restrictions in their cod-rich waters.
Sharyn Alfonsi: What did you see happen in town when that happened?
Bob Formby: Gosh. It was a disaster, to be quite honest. Because everybody was involved some way in fishing. Like taxi drivers, the pubs, the dress shops, and places like that– they all suffered.
Dennis Avery: Once the fishin’ sorta went, it all sorta died a death.
Wind power has breathed new life into Grimsby. Offshore energy company Orsted says its created 600 jobs here and invested over $18 billion in local wind farms.
But there are plenty of people who worry the environmental impact of the wind turbines hasn’t been sufficiently studied and others say the industry has not created the number of jobs they have promised, but the concern of these retired fishermen is more practical.
Bob Formby: We’re not seeing benefits.
Sharyn Alfonsi: Your electricity bill hasn’t gone down?
Bob Formby: No. It’s gone up if anything. When they said about em how ‘Oh, we’re going to get cheap electricity and it’s going to be green and everything.’ But I can’t see any benefits to be quite honest.
Sharyn Alfonsi: Has your electricity bill gone down?
Dennis Avery: Try double! It’s doubled.
Sharyn Alfonsi: There are people who have said, ‘Yeah, we’ve got all these turbines. But our electricity bill hasn’t gone down a cent.’
Benj Sykes: Yeah, it’s a real challenge that. It’s gonna take time. Because we need to build more offshore wind.
Sharyn Alfonsi: So you think if there’s more offshore wind, prices could go down?
Fearing the war in Ukraine could lead to blackouts last winter, the U.K. government announced more drilling for oil and gas in the North Sea. They will also speed up the time it takes for new offshore wind projects to get online.
Benj Sykes told us that over the next eight years, Orsted plans to invest another $17 billion in wind farms and add more than 300 jobs in Grimsby.
Benj Sykes: You know the fishing industry was fantastic for Grimsby. That era has passed. What we want to do is be a part of creating the next chapter of Grimsby’s life and of the country’s life as we build out.
A chapter Bridie Salmon is very much a part of.
Bridie Salmon: So that’s gone from Grimsby being the fishing town, to the powerhouse of the north, which is an amazing transition.
Sharyn Alfonsi: Proud of it?
Bridie Salmon: So proud of it. And to be a part of it is amazing.
A town’s future and fortune, once again tied to the sea.
Produced by Ashley Velie. Associate producer, Jennifer Dozor. Broadcast associate, Elizabeth Germino. Edited by April Wilson.
AUGUSTA, Maine — Maine is poised to launch an offshore wind program that would meet clean energy goals and produce enough power for about 900,000 homes from floating wind turbines in the Gulf of Maine.
The legislation, which was approved by the state Senate Tuesday, calls for requests for proposals to be issued for 3,000 megawatts of electricity from offshore wind turbines by 2040. That’s enough electricity to power about half of Maine’s electricity load.
The bill was revised after a veto by Democratic Gov. Janet Mills to ensure non-union companies can get into the business.
“This bill means jobs. It means lower, more stable energy prices, while at the same time addressing climate change. We need to pass this bill now,” said Democratic Sen. Mark Lawrence, the bill’s sponsor, before the vote. The House votes next.
Approval would put Maine on a path to catch up with other states that already have offshore wind projects. The catch, however, is that the wind turbines would be farther offshore than those projects, and would involve floating turbines. It also includes incentives aimed at ensuring wind power developers steer clear of lucrative lobster fishing grounds.
Lawrence, of York, said he believes the compromise bill has necessary “guardrails in place to make sure this is done right and truly benefits Mainers.”
The U.S. Bureau of Ocean Energy Management already approved projects that are now under construction off Massachusetts, New York and Rhode Island, and it gave the green light earlier this month for New Jersey’s first offshore wind farm to begin construction. Next month, it will hold an auction for leases in the Gulf of Mexico.
In Maine, the timeline calls for the federal lease sales to be completed next year and for the state to release request for proposals to operate the offshore wind turbines in early 2026.
The Gulf of Maine is considered a prize when it comes to consistent, powerful winds, but the water is too deep for traditional wind turbines that are anchored to the ocean floor. Maine officials hope companies will license technology from the University of Maine, which has been pioneering precast floating turbines that can be built on land and towed to sea.
“This is the bill that will jumpstart the offshore wind industry in Maine,” said Jack Shapiro, climate and clean energy director for the Natural Resources Council of Maine.
More than a decade ago, the state was poised to host a $120 million wind project led by Norwegian company Statoil, but Statoil backed out after the state reopened bidding to provide an opportunity to the University of Maine.
The U.S. could need roughly 2,000 of the most powerful turbines to meet its goals to ramp up offshore wind. Doing so would dramatically cut its use of fossil fuels, protect the atmosphere and reduce climate change.
Millions of Americans are still feeling the heat. At least 33 states saw temperatures reach 90 degrees Fahrenheit on Friday, and it’s a trend scientists say will likely continue. Texas Tribune energy reporter Emily Foxhall joins CBS News to discuss how the Lone Star State’s power grid is keeping up with demand.
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
