Offshore wind can be price competitive

On a par with natural gas, hydroelectricity

For years, supporters have made a convincing case that offshore wind power can play a central role in scrubbing the air we breathe of millions of tons of carbon dioxide produced by burning fossil fuels.

But in the Commonwealth of Massachusetts, which stands to lose more than 10 percent of its electric power production with the closing of obsolete nuclear power and fossil-fuel burning plants, the case for renewable power is as much about delivering large amounts of electricity at competitive pricing as it is about clean air.

That is why a study released March 15, 2016, by the University of Delaware Special Initiative on Offshore Wind is so important.

The study focused on Massachusetts, where the Legislature is debating a bill that will shape the state’s energy policy for a generation. The study found that should Massachusetts adopt a requirement that the state’s utilities purchase 2,000 megawatts of power from offshore wind developers over the next decade, the cost of wind-generated power would fall by more than half to a competitive 10.8 cents per kilowatt hour.

That would make the price of offshore wind more than competitive with natural gas and hydroelectric generation — even without the kinds of tax breaks that have been afforded the oil and gas producers and with none of the environmental costs that fossil fuels impose.

Cost has long been the hold-up for offshore wind in Massachusetts. The stalled Cape Wind project would have delivered power at a cost of 24 cents a kilowatt hour, a price that both utilities and industrial users balked at. That project appears to be permanently derailed, however, three large wind farm developers hold leases on three tracts of ocean off the coast of Martha’s Vineyard and Nantucket.

The University of Delaware report predicts those developers should be able to deliver power under the initial contract at a rate of 16.2 cents per kilowatt hour. By the end of the 2,000 megawatt buildout a decade later, those costs are predicted to fall to 10.8 cents a kilowatt hour.

The same market forces that are driving down the cost of offshore wind power in Europe — such as the efficiencies gained from large-scale production and technological innovation — can be expected to work here. Of course, Europe has a more than 20-year head-start on the United States, and the United Kingdom will be producing power from offshore wind in the 10-cent  range within the next few years.

The US will benefit from what Europe has learned. And as offshore wind developers recognize that the United States, with over 400,000 MW of wind power available off both coasts, is their next great market, they will build factories here to produce the hundreds of components necessary for wind turbine construction, assembly and deployment. That too will drive down the cost of delivery because those big, heavy pieces will no longer need to be shipped across the ocean for assembly and installation here. And, once installed, those turbines will need to be operated and maintained. Together that will mean thousands of new jobs right here in Massachusetts as the new industry matures.

Meet the Author

Paul Vigeant

Managing director, New Bedford Wind Energy Center
The Massachusetts Legislature will vote this session to approve energy legislation that is expected to include offshore wind. With 2,000 megawatts, Massachusetts can begin reaping the benefits of industrial scale power production, and lower long term price stability for ratepayers.

Paul Vigeant is the managing director of the New Bedford Wind Energy Center.