The Grand Challenges of Offshore Wind Financing in the U.S.

Tyler Hansen, Lena Kitzing, Elisabeth J. Wilson, Jeffrey P. Fitts, Philipp Beiter, Jérôme Guillet, Malte Jansen, Marie Münster, Vanessa Pinney, Umar Salman, Bjarne Steffen, Bolun Xu, Melissa Lott

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Abstract

Interest and development in offshore wind energy in the U.S. is at an all-time high. The Biden Administration committed to increasing offshore wind capacity from a meager 42 megawatts (MW) in 2022 to 30 gigawatts (GW), or 30,000 MW, by 2030—enough to power 10 million homes. Achieving this target would require over $100 billion in new investments and create 80,000 full-time-equivalent jobs from 2023-2030. In addition, states have committed to procuring 64 GW of offshore wind by 2045, and the pipeline of actual offshore wind projects rose to more than 40 GW by May 2022, representing a nearly 1,000-fold increase from current installed capacity. Such a scale-up would transform the sector and make major strides in enabling the nation to rapidly decarbonize, improve energy security, and support universal access to affordable energy in a climate-changing world. Critical to achieving success is financing. While there is no shortage of financial capital, employing it faces major challenges. We explored these challenges during a two-day business-academia collaboration workshop at Columbia University, June 23-24, 2022, and we identified five grand challenges, i.e., potential showstoppers—challenges that, if not solved, will prevent the massive and rapid scale-up of offshore wind from taking root. These include (1) navigating the complexities, timing mismatches, and high costs of the early years of developing an offshore wind project; (2) addressing the failure of support policy to provide certainty on future costs and revenues; (3) developing a capable workforce in an immature and inexperienced market; (4) building an offshore wind-friendly transmission network; and (5) financing and scaling up floating offshore wind technologies. If solved, the U.S. will move several steps closer to turning the potential for an offshore wind transformation into reality.
Original languageEnglish
Number of pages20
Publication statusPublished - 2022
Event2022 Offshore Wind Financing Business-Academia Collaboration Workshop - New York City, United States
Duration: 23 Jun 202224 Jun 2022

Conference

Conference2022 Offshore Wind Financing Business-Academia Collaboration Workshop
Country/TerritoryUnited States
CityNew York City
Period23/06/202224/06/2022

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