The U.S. Department of Energy (DOE) has released its latest report in the Pathways to Commercial Liftoff series, describing how the U.S. offshore wind sector is adapting to challenges and poised for continued progress to create tens of thousands of new jobs.
The Pathways to Commercial Liftoff: Offshore Wind Deployment report analyses market challenges and solutions already underway, finding that the sector is adapting to recent cost pressures and will see lower risk and costs as deployment scales over time. Key takeaways and insights include:
- The U.S. offshore wind market is at an inflection point. Despite facing macroeconomic challenges, the sector is adapting, and improved risk mitigation is being built into industry planning. State leadership has been and will remain fundamental, as will federal policy, including use of long-standing tools and new resources made available through the Bipartisan Infrastructure Law and the Inflation Reduction Act.
- The sector is poised for Liftoff, beginning with the 10–15 GW of projects with a path to final investment decision in the next few years. These projects will lay the foundation for consistent long-term deployment, decarbonisation, and economic benefits across the country. Longer term, offshore wind can deliver over 100 GW of clean power by 2050.
- While costs increased over the past few years, there is a path to cost reductions moving forward. Cost increases were driven by rapid inflation of equipment costs, rising interest rates, supply chain constraints, and schedule delays, but global cost headwinds have begun to stabilise and new offtake solicitations de-risk development going forward. Governments and industry are drawing on lessons learned, with ongoing efforts to refine project and supplier procurement, foster regional collaboration for supply chain and transmission planning, and make investments to support necessary enabling infrastructure.
- Offshore wind has a compelling and distinctive value proposition. Offshore wind is a central pillar of decarbonising coastal population centres, and offtake costs reflect not only the cost to generate clean power, but also the cost to deliver power to coastal load centres (transmission) and the opportunity to revitalise maritime infrastructure and domestic manufacturing. Offshore wind power has a compelling and distinctive value proposition that complements other clean resources, with high capacity factors and strong winter production that support grid reliability and resource diversity.
To help deliver on the potential of this industry, DOE also announced its intent to fund $48 million in research and development projects for offshore wind technology development, domestic manufacturing, and more—new DOE funding that is part of broader federal resources that the Biden-Harris Administration is deploying to grow the American offshore wind industry.
