Building on a momentum

ALL IMAGES COURTESY OF BUSINESS NETWORK FOR OFFSHORE WIND, UNLESS STATED OTHERWISE.

The Business Network for Ofshore Wind’s annual US Ofshore Wind Market Report & Insights shows last year’s developments and looks forward to what will happen in 2022. The report identifes 2021 as a transformational year that kickstarted the US ofshore wind industry.

Several US state governments procured nearly 8.5GW of ofshore wind capacity during 2021 alone. This brings the total US ofshore wind tenders to approximately 17.5GW, nearly double the approximately 9.1GW at the start of 2021 (see table 1 and 2). Whereas 2021 can be considered as a transformational year, 2022 is expected to build on that momentum, which will see supply chain growth, added lease auctions, and most importantly, steel in the water. This year will see ofshore wind lease auctions in three diferent US waters. The longawaited New York Bight auction took place in February. Developers were able to bid on six ofshore wind lease areas, the most areas ever ofered in a single auction. The lease sale drew competitive winning bids from six companies totalling approximately USD 4.37 billion and is likely to result in an infux of new market participants which will create market conditions that can lead to downward pressure on project electricity prices (see fgure 1). In May, the Carolina Long Bay auction will take place, followed by the Northern and Central California >>

New Jersey Atlantic Shores Ofshore Wind Ocean Wind 2 Massachusetts Commonwealth Wind Mayfower Wind 2 Maryland Momentum Wind Skipjack Wind 2 New York Beacon Wind Empire Wind 2

Total

Source: US Offshore Wind Market Report & Insights 2022 – Business Network for Offshore Wind. 1,510MW 1,148MW 1.232MW 400MW 808.5MW 846MW 1,230MW 1,260MW 8.5GW

2015 Coastal Virginia Ofshore Wind (CVOW) Pilot Block Island Wind Farm 2016 South Fork Wind 2017 MarWin SKIPJACK 1 2018 Vineyard Wind Revolution Wind 2019 Park City Wind Ocean Wind 1 Mayfower Wind CVOW Commercial (phase 1,2,3) 2020 Icebreaker Maine Aqua Ventus I Sunrise Wind

Total 12MW (fully commissioned)

30MW (fully commissioned) 132MW 270MW 120MW 800MW (preconstruction) 304MW 804MW 1,100MW 804MW 2,640MW 20.7MW (consent authorised) 120MW 880MW 9.1GW

Source: US Offshore Wind Market Report & Insights 2022 – Business Network for Offshore Wind.

Provisional Winner OW Ocean Winds East (EDP Renewables and Engie) Attentive Energy (EnBW and TotalEnergies) Bight Wind Holdings (RWE Renewables and National Grid) Atlantic Shores Ofshore Wind Bight (Shell and EDF Renewables) Invenergy Wind Ofshore Mid-Atlantic Ofshore Wind (Copenhagen Infrastructure Partners)

Source: BOEM. Area

Hectares OCS-A 0537 28,943

OCS-A 0538 34,128

OCS-A 0539 50,976

OCS-A 0541 32,112

OCS-A 0542 33,984 OCS-A 0544 17,424

federal ofshore wind lease auctions in September. In Q4, the frst ofshore wind leasing in the Gulf of Mexico will be conducted. Additionally, two projects (Vineyard Wind and South Fork Wind) will move into the construction phase during 2022. More projects (Revolution Wind, Ocean Wind, Empire Wind, and CVOW-C) are close behind in the federal permitting process. It is also expected that contracts for all kinds of ofshore wind project components and services will be executed during 2022.

The ofshore wind’s rapid growth attracts the attention of domestic suppliers, and commitments are made for new manufacturing facilities, port development, transmission, and other vital infrastructure needs. “The US ofshore wind market became a national industry in 2021”, says Liz Burdock, CEO of Business Network for Ofshore Wind. “States on three coasts now have active wind programs or interests, suppliers are located in more than 30 states, and nearly USD 7 billion has been invested in the US ofshore wind market to-date, with over USD 2 billion alone in 2021.” Ample eforts are required to build a robust domestic manufacturing supply chain as the US ofshore wind industry shifts from permitting and siting into manufacturing, construction, and

Artist impression courtesy of Dominion Energy.

Source US Offshore Wind Market Report & Insights 2022 – Business Network Offshore Wind.

installation. Last year, according to the report, contracts were awarded to companies that covered various capabilities needed in the ofshore wind industry, such as geotechnical surveying, cable manufacturing, and insurance risk advising. As most projects still are in the siting and permitting phase, consulting services represented a substantial portion of the contracts tracked (see fgure 2).

Vessel type Proposed Under construction

Wind turbines installation vessel 1 Ofshore wind support vessel (super feeder) Service operations vessel (SOV) Rock placement vessel Crew transfer vessel (CTV) 2

2 1 8 1

2

Source: US Offshore Wind Market Report & Insights 2022 – Business Network Offshore Wind. Operating

3

The frst construction projects still source large components from established facilities overseas. However, domestic companies can respond by exploring other opportunities in the supply chain, such as smaller scopes of work to fabricate subassemblies such as secondary steel, or to provide portside fnal assembly assistance on nacelles or strictly as vessel operations or support. This way, companies will gain valuable experience on projects while preparing for the domestic growth in manufacturing faculties that are beginning to take shape. Vessels are indispensable to support the construction, operation and maintenance of ofshore wind farms, and shipbuilding. New builds, refts, maintenance, and (de) mobilisation of ofshore support vessels could ofer ample opportunities for the US supplying industry. As of January 2022, there is one Jones Act-compliant wind turbine installation vessel (WTIV) under construction in the US, Dominion Energy’s Charybdis. A service operations vessel (SOV) is planned for construction at a combination of shipyards in Florida, Mississippi, and Louisiana. Both vessels are being built with steel from Alabama, North Carolina, Pennsylvania, and West Virginia (see table 3).

Partnerships will help companies learn and obtain experience. Certain US areas already are seeing clusters formed of ofshore wind activity. Many companies have opened ofces in the same buildings or within the same shared ofce spaces. These hubs of ofshore wind activity can be found in Rhode Island, Massachusetts, and New York. Other manufacturing-centric hubs are forming in among others, Albany, New York, at the New Jersey’s Wind Port, Baltimore, and in coastal Virginia. “Critical industry benchmarks are achievable because of the Biden administration’s whole-ofgovernment approach that saw collaboration between the Departments of Interior, Energy, Commerce, Transportation, and others”, Ms Burdock voices. “However, the US must not let up its pace because global competition in ofshore wind is ferce and intensifying. The US market needs more businesses that can expand and adapt their current capabilities – the good news is, 2021 proved there’s a lot of opportunity for growth within ofshore wind for 2022 and many more years to follow.”