“The U.S. has an abundant offshore wind resource that remains untapped,” Energy Secretary Steven Chu
Offshore wind development continues to face strong headwinds in the United States. Offshore wind has been touted as a good alternative to onshore wind because wind resources are generally better offshore, but the reality has been different so far. Offshore wind is far more expensive than onshore wind and even pro-green states like New York are having second thoughts. General Electric is facing lower than expected offshore wind orders and is considering laying off some of its wind workers in Norway. And even with substantial federal subsidies, some utilities are fighting back against the offshore wind industry mainly because of its expense.
The New York State Offshore Wind Project
New York State, which usually is an advocate of green energy, is foregoing an offshore wind project due to its high cost. The project was to develop offshore wind farms for Great Lakes Ontario and Erie, whose cost of construction would be recovered over the next 20 years by selling its generation to the New York Power Authority. The buyers of the power, the New York Power Authority, turned the project down due to its expense.
Five wind developers submitted proposals to develop an offshore wind farm on Great Lakes Ontario and Erie in the range of 120 to 500 megawatts. The lakes are thought to be one of the most reliable sources of electricity generated by wind in New York State because the wind blows uninterrupted. According to the New York Power Authority, a 150-megawatt wind farm would cost between $1.2 billion and $2.0 billion to build and would cost the Authority between $60 million and $100 million annually in power purchases.[i] That translates into a per kilowatt cost of $8,000 to over $13,000, much higher than the estimated cost of an offshore wind farm by the Energy Information Administration of $5,975 per kilowatt.[ii] In fact, the lower figure is over a-third higher.
It seems that New York is facing a similar problem to that of Massachusetts where Cape Wind off the coast of Cape Cod is having a problem finding buyers for its high cost offshore wind energy. Some Massachusetts utilities (e.g. NStar) are realizing that they can meet their state’s renewable mandates by purchasing renewable power from Canada or from onshore wind farms at much lower cost. National Grid, the utility ready to buy half of Cape wind’s power, estimates its deal will cost ratepayers $1.2 billion above the projected market price of comparable energy. In comparison, NStar claims its contracts with three land-based wind farms are $111 million below market price.[iii]
General Electric Rethinking Offshore Wind Operations
General Electric is facing slower than expected growth in offshore wind energy orders and is reviewing its development plans. In fact, it is considering laying off 40 workers in Norway and is holding off on a facility in the United Kingdom until equipment orders can support the plant.[iv] The company is planning to erect a 4.1 megawatt wind turbine prototype offshore in Gothenburg Harbor by the end of the year that the company feels will be good for shallower waters but is facing tough competition from other wind turbine manufacturers.[v]
For deep offshore waters, General Electric is working on a 10 to 15 megawatt wind turbine using superconducting magnets for which the U.S. Department of Energy is providing $3 million. The project will be conducted in two stages, a development and evaluation stage that includes economic, environmental and commercialization potential, and a commercialization stage to determine its potential in scale and cost. The goal is to generate more wind power at lower cost.[vi]
Department of Energy Funds Offshore Wind Development
The U.S. Department of Energy has funded 41 wind energy projects to the tune of $43 million to accelerate offshore wind development.[vii] The funding is to be provided over 5 years to improve the technology of offshore wind turbines, including control systems and support-structure designs, and to eliminate market barriers that hinder development.
The Department of Energy has already funded innovative solar projects such as Solyndra[viii] which has resulted in a loss of taxpayer money since that company is now bankrupt and cannot repay the government the $528 million that the company has spent,[ix] including a very modern facility with robots and the latest in spas. Solyndra’ s plan sought to cut costs with an innovative cylindrical design that reduced the labor required for installation, but the company could not handle the high manufacturing costs. A similar problem could result with the Department of Energy’s offshore wind investment loans if the technology’s high costs cannot be brought down to a more competitive range compared to existing technologies.
Some Criticisms of Wind Power
There are some critics who complain about the visual appearance of wind turbines. Donald Trump, for example, is fighting an offshore wind farm in Scotland because of the view from his proposed golf course. The offshore wind farm, to be located about 1.5 miles from the golf resort, was to be a 33 wind turbine farm, but has since been scaled back to 11 turbines because of safety issues in the shipping channel serving the North Sea oil industry.[x]
Another criticism is that they kill birds. According to the Fish and Wildlife Service, windmills kill nearly half a million birds a year. The American Bird Conservancy projected that the number could more than double in 20 years if a government wind power goal of supplying 20 percent of the nation’s power by 2030 is attained. Recently golden eagles were found dead near the Pine Tree Wind Farm project, operated by the Los Angeles Department of Water and Power. Laws protect eagles and many migrating birds (e.g., the 1918 Migratory Bird treaty Act), but currently there are only voluntary guidelines for wind power producers.[xi] The irony is that seven oil and gas companies operating in North Dakota were recently brought to task for supposedly killing 28 migratory birds that were found dead near some oil waste lagoons. These misdemeanors carry fines of up to $15,000 for each dead bird and up to six months in prison.[xii]
Other criticisms besides cost, view, and bird kills deal with its intermittency, requiring back-up power; noise pollution; government subsidies; low capacity factors; and small environmental contribution to name just a few. A wind project in Vermont is found to be an example, where it will receive $44 million in federal production tax credits over 10 years, produce only one-third of its rated capacity of 63 megawatts, reduce few greenhouse gas emissions since only 4 percent of the state’s emissions come from electricity generation, remove 134 acres of forest which will increase erosion to headwater streams, and hurt the tourist population.[xiii]
Further, old or broken wind turbine blades cannot be recycled, posing a new problem for the industry. Denmark’s leading business newspaper Dagbladet Børsen recently warned, “As the wind becomes a central part of energy supply, a huge waste problem is growing with similar speed.” A key material in constructing wind turbines, carbon fiber composite, cannot be recycled and is either filling European landfills or is being burned creating toxic emissions. Nearly all turbine blades are manufactured from thermoset plastics, the only material currently known that meets reliability standards due to their relatively high strength and low weight properties. But the stress damage to fiber composites is poorly understood and wear and tear on blades can be considerable, reducing power generation by 20 to 30 percent, and needing to regularly replace blades.[xiv]
Offshore wind farms are struggling in the United States because they are far from cost effective compared to their onshore counterpart or to conventional generating technologies. An offshore wind farm in the United States is yet to be built though several proposals have been put forth. Prudency reviews by utility companies have kept them in check so far. Of course, besides cost, other factors regarding wind are the need for government subsidies costing taxpayers money, low capacity factors and emissions abatement, and environmental issues regarding views, bird kills, noise, and waste.
[i] The Times Union, High costs end New York plan for Great Lakes wind power, September 28, 2011, http://www.timesunion.com/local/article/High-costs-end-New-York-plan-for-Great-Lakes-wind-2191929.php#ixzz1Zjz3hwXv
[ii] Energy Information Administration, Updated Capital Cost Estimates for Electricity Generation Plants, http://www.eia.gov/oiaf/beck_plantcosts/index.html
[iii] Boston, Discrepancy in power prices fuels opponents of Cape Wind, March 28, 2011, http://articles.boston.com/2011-03-28/news/29360466_1_cape-wind-offshore-wind-project-renewable-power
[iv] Recharge, Update: GE rethinks offshore wind strategy as orders stay away, http://www.rechargenews.com/energy/wind/article277079.ece
[v] Recharge, GE 4MW direct-drive turbine coming to Gothenburg port, http://www.rechargenews.com/energy/wind/article248458.ece
[vi] Recharge, GE begins design work on ‘up to 15MW’ direct-drive turbine, http://www.rechargenews.com/business_area/innovation/article275513.ece
[vii] Bloomberg, U.S. Awarding $43 Million to Boost Development of Offshore Wind, September 8, 2011, http://www.bloomberg.com/news/2011-09-08/u-s-awarding-43-million-to-boost-development-of-offshore-wind.html
[viii] The Wall Street Journal, Solyndra Said to Have Violated Terms of Its U.S. Loan, September 28, 2011, http://online.wsj.com/article/SB10001424052970204422404576596601891250510.html
[ix] New York Times, Solar Firm Aided by Federal Loans Shuts Doors, August 31, 2011, http://www.nytimes.com/2011/09/01/business/energy-environment/solyndra-solar-firm-aided-by-federal-loans-shuts-doors.html?pagewanted=2&_r=1&nl=todaysheadlines&emc=tha25&adxnnlx=1314885655-GfYmh7570jSeXt41zO0uqw
[x] The Guardian, Donald Trump pledges ‘any legal means’ fight against wind farm, August 5, 2011, http://www.guardian.co.uk/world/2011/aug/05/donald-trump-legal-fight-windfarm
[xi] The Washington Post, Wind farms under fire for bird kills, August 28, 2011, http://www.washingtonpost.com/national/health-science/wind-farms-under-fire-for-bird-kills/2011/08/25/gIQAP0bVlJ_story.html?hpid=z3
[xii] The Wall Street Journal, A Bird-Brained Prosecution, September 29, 2011, http://online.wsj.com/article/SB10001424053111903791504576588642920063046.html
[xiii] The New York Times, The Not-So-Green Mountains, September 28, 2011, http://www.nytimes.com/2011/09/29/opinion/the-not-so-green-mountains.html?_r=1&nl=todaysheadlines&emc=tha212
[xiv] CO2 Insanity, Broken Wind Turbine Blades Create Mountainous Waste Problem, June 12, 2011, http://co2insanity.com/2011/06/12/broken-wind-turbine-blades-create-mountainous-waste-problem/