Offshore Wind Costs Are Getting Worse | Eastern North Carolina Now

    Publisher's Note: This post appears here courtesy of the John Locke Foundation. The author of this post is Jon Sanders.

    Trying to turn our oceans into sprawling, on-again/off-again electric stations is becoming even more prohibitively expensive. In August, I linked to several reports about the skyrocketing costs of offshore wind. On average, expenses associated with offshore wind developments had increased by 57 percent - since 2021.

    Unlike other businesses faced with rising costs, offshore wind developments get to dump their costs on electricity consumers, who are given no choice in their electricity providers and are at their mercy as to the expense of the generation sources they use (and their reliability as well). Politicians are increasingly involved in telling utilities which generating sources to use. Electricity being a basic human need, it's not something people can choose to avoid.

    This setup - captive consumers, critical consumer good, and politicians and bureaucrats imposing their preferred sources on utilities - is a crony's playground. The costs are getting so big, however, that playtime looks like it's about over.

    For example, the Associated Press reported on August 31 that, during a recent earnings call, Orsted has announced delays in its Ocean Wind I project off the cost of New Jersey, at least till 2026, and even admitted the company had "considered simply abandoning" the project. The announcement comes even after "New Jersey Gov. Phil Murphy signed a law allowing Orsted to keep federal tax credits it otherwise would have been required to pass along to ratepayers."


    The offshore wind developer also announced "reconfiguring" its Ocean Wind II project and its Skipjack Wind project off the coast of Delaware and Maryland. The AP stated that Orsted "did not give details of what that reconfiguration might entail."

    It's worth noting that the delays are even more surprising given the generous levelized revenues guaranteed to those projects: over $92 per megawatt-hour (MWh) for Skipjack and over $98/MWh for Ocean Wind.

    On October 12, Reuters reported that New York had rebuffed requests from Orsted and other offshore wind energy developers "to charge customers billions of dollars more under future power sale contracts." Reuters reported that the denial could cause some developers to "scrap plans."

    On October 25, the Telegraph (UK) reported that the head of the UK's biggest offshore wind energy developer, RWE, said that electricity prices need to increase by 70 percent before any more offshore wind projects would be built off British shores. The offshore wind executive blamed electricity prices for "the disastrous result of the last offshore wind allocation round in September, which ended in a humiliation for ministers with not one company offering to build new offshore wind farms." (Around the same time, the U.S. Department of the Interior fielded "paltry interest" in an auction for three offshore wind leases in the Gulf of Mexico, with only one site even getting bids - the other two going unsold.)

    Why All This News Is Important for North Carolina

    North Carolina law has long required least-cost, reliable electricity at the flip of a switch. In 2021, lawmakers applied those least-cost and reliable guardrails to law calling for reducing carbon-dioxide (CO2) emissions from electricity generation to reach "carbon neutrality" by 2050. That law is helping to keep utilities in North Carolina from jumping overboard on high-cost (increasingly-higher-cost) offshore wind.


    Forcing offshore wind in North Carolina, as Gov. Roy Cooper wishes, would hike electricity rates significantly, cost tens of thousands of jobs outside of fishing and tourism, wreck coastal fishing, and cripple local tourism with coastal views spoiled by visible, flashing turbine arrays. It would cause irreversible damage to critically endangered and threatened marine animals and avian species, including North Atlantic right whales and loggerhead turtles. The massive size of the turbines being discussed means they would instantly become the tallest man-made structures in North Carolina, be extremely disruptive to U.S. military operations, facilities, and training off the coast, and also be uniquely endangered by being placed in the most hurricane-prone waters in the East Coast.
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( March 20th, 2024 @ 4:44 pm )
So you have finally learned at least one of the weather cycles, Bobbie? Yes, summer is hot and winter is cold, and always have been. The multi-year La Nina / El Nino cycles may impact how hot or how cold. Then there are the multi-century climate cycles. We came out of a particularly cold one, known as the Little Ice Age or Maunder Minimum in the 19th century and have been in a natural warming cycle since. The Earth is not yet as warm as the last multi-century warming cycle known as the Medieval Warm Period, and not even close to the longer and hottest of the warm cycles, the Holocene Maximum.
Big Bob said:
( March 20th, 2024 @ 2:40 pm )
Summer is coming big boy. Post all you want, those in 100 plus temps for months have greater impact than anything you post
( March 20th, 2024 @ 11:10 am )
NC's green mafia is promoting this expensive and unreliable wind and solar electricity, with offshore wind being the absolute worst. This will both make our electric service subject to blackouts and make it lots more expensive. Politicians who have promoted this anti-consumer boondoggle include Gov. Roy Cooper (D), Atty General Josh Stein (D), Sen. Phil Berger (RINO), Speaker Tim Moore (RINO), and local Sen. Jim Perry (RINO). Lt. Governor Mark Robinson (R) after being briefing on the issue, refused to take a stand either way. Former local Senator Bill Cook (R) and former local State Rep. Mike Speciale fought hard against this consumer ripoff. Rep. Keith Kidwell (R) has also opposed it.

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