Offshore Headwinds By Jonathan Lesser
https://www.nationalreview.com/magazine/2022/05/02/offshore-headwinds/
Green-energy dogma is like an ocean liner — slow to change course and difficult to halt. In Europe, Russia’s invasion of Ukraine has magnified the folly of Europe’s energy policies: Massive subsidies for wind and solar power coupled with bans on hydraulic fracturing (fracking), widespread shuttering of nuclear plants, and increased dependence on Russian natural gas have created a perfect energy-supply storm.
In the U.S., the Biden administration is using the Ukraine invasion as an excuse to double down on green-energy and electric-vehicle policies, while simultaneously conspiring to keep gasoline prices high and berating oil companies for not producing more. Only last fall, Democrats were berating oil companies to make them produce less.
To recount the full extent of the Biden administration’s ongoing energy follies would require a long and depressing book. But one particular facet typical of the administration’s green-energy fantasies warrants special attention: its proposal to install 30,000 megawatts (MW) of offshore wind turbines by 2030, and 110,000 MW by 2050. That’s equivalent to installing one 850-foot-tall, 14-megawatt turbine, the largest available, every 30 hours for the next 28 years.
According to Secretary of Energy Jennifer Granholm, “this offshore wind goal is proof of our commitment to using American ingenuity and might to invest in our nation, advance our own energy security, and combat the climate crisis.” The administration claims that the short-term 30,000 MW target would create thousands of new jobs and avoid 78 million tons of carbon dioxide emissions each year. (By comparison, total U.S. carbon dioxide emissions in 2019 were about 5 billion metric tons.) Regardless of whether these claims are accurate (they aren’t), the 30,000 MW target, to say nothing of the 110,000 MW one, would be both physically impossible and economically unaffordable.
Offshore wind is hugely expensive, much more so than solar, onshore wind, hydropower, geothermal, or even nuclear power. And despite proponents’ claims to the contrary, the costs of installing offshore wind facilities are not decreasing. They are increasing.
The constraints faced by the industry are going to raise the costs of offshore wind projects even higher as developers compete for scarce resources. Moreover, because it is inherently intermittent — producing electricity only when the wind blows — offshore wind will require significant investment in costly backup-supply resources, primarily gas-fired generators, to compensate for the more than 50 percent of all hours when the wind doesn’t blow. Although wind and solar proponents claim that battery storage would eliminate the need for fossil-fuel backup generation, the costs, raw-materials requirements, and manufacturing capacity needed to produce the quantity of battery storage necessary to provide even three to four hours of backup power would be staggering.
There is only one offshore wind facility operating in the U.S. today — the five-turbine, 30 MW Block Island Wind Farm, located off the coast of Rhode Island. Block Island exemplifies the technological issues that are almost certain to affect future U.S. offshore wind development. Operational problems have plagued it since it began producing electricity in December 2016. In 2017, tidal action uncovered both of the undersea cables that deliver electricity from the turbines. After almost five years, the 22-mile-long cable to the mainland still has not been reburied.
Developing a single offshore wind project — from project conception to completion of construction and final testing — can take a decade or more. After securing an offshore lease, developers must prepare detailed construction and operation plans, which must be approved by the Bureau of Ocean Energy Management, which then prepares a detailed environmental-impact statement. Developers must then handle the inevitable legal challenges to the agency’s findings.
And challenges there are. Offshore wind development off the Atlantic Coast is facing growing environmental pushback. Vineyard Wind — an 800 MW project first conceived in 2009 and for which preliminary construction began last year — is facing at least three lawsuits, two of which allege that the project would harm the endangered North Atlantic right whale and threaten commercial and sports fisheries. These lawsuits will delay Vineyard Wind’s completion, perhaps for years. The cumulative ecological impacts of multiple offshore wind projects will become an increasingly contentious issue.
Because offshore wind power is inherently intermittent, transmission-system planners must determine the amount of reserve capacity needed to meet the federal government’s reliability standards. Maintaining a reliable grid requires backup generators that can “firm up” offshore wind’s output, a necessity that advocates usually ignore when claiming that wind energy is “low-cost.” And although green-energy advocates claim that battery storage and so-called dispatchable emissions-free resources (DEFR) would provide that backup, the former’s costs are astronomical, and the latter do not yet exist. For example, one idea for a DEFR is a combined-cycle generator that is powered by hydrogen instead of natural gas. Unfortunately, the only cost-effective way to produce hydrogen today is to use . . . natural gas, which produces higher carbon emissions than just burning natural gas directly.
As for claims that enough battery storage can be deployed to ensure reliable electric supplies, Manhattan Institute fellow Mark Mills has shown that this is magical thinking. The quantities of raw materials needed for large-scale battery manufacture are staggering. Plus, one would need to build the equivalent of hundreds of Tesla “gigafactories” to produce sufficient numbers of storage batteries to provide even a few hours of backup power for 30,000 MW of offshore wind, much less the 110,000 MW the Biden administration promises by 2050.
The proposed surge in offshore wind development also would run headlong into basic economic realities of scarce resources. The raw materials needed for these projects are expensive and already in short supply.
Wind turbines, as well as solar panels and storage batteries, require rare earth metals. Most of the rare earths required are sourced from China, which currently produces about 70 percent of global supplies. As the demand for rare earths increases, in part because of rising demand for batteries to power electric vehicles, which the Biden administration wants to account for 50 percent of all new-vehicle sales by 2030, supply shortages will be likely. Currently, the United States has little mining capacity for rare earths, although a new mine in Hudspeth County, Texas — the Round Top Heavy Rare Earth, Lithium, and Critical Minerals Project, which is being developed by USA Rare Earth — is slated to open sometime in 2023, if there are no environmental delays.
The magnets that wind turbines use to generate electricity contain rare earths. But USA Rare Earth is the only manufacturer of these magnets in the United States. Boosting wind-energy production — both onshore and offshore — would require far greater supplies of those magnets, which would increase manufacturing costs.
Supplies for other key inputs, such as steel used for foundations and towers, are also in short supply, and prices have increased substantially. Higher energy prices also are making steel manufacturing more costly.
Then there is the turbine-installation process itself. It requires wind-turbine-installation vessels (WTIVs), specialized and expensive ships — costing around $500 million each — of which there are few. Only six WTIVs capable of erecting the newest generation of turbines are expected to be in service by the end of next year throughout the world. And only one, the Charybdis, will be able to deliver the component parts from American ports, thanks to the Jones Act, which requires goods shipped between U.S. ports to be transported on vessels that are built, owned, and operated by U.S. citizens or permanent residents.
Once installed, turbines require the siting and laying undersea cables to deliver the electricity generated to the mainland. These, too, require an extensive planning review, to avoid unintentional unburial à la Block Island. Specialized vessels are needed to lay the cable. There are already multi-year waiting periods for delivery of cable from manufacturers.
The physical and regulatory realities of constructing offshore wind projects and associated infrastructure mean that meeting the administration’s goal would be impossible. Moreover, the excessive costs associated with offshore wind development, together with the resulting higher electric prices that would reverberate through the entire economy, would destroy far more jobs and investment than would be created by the massive subsidies the projects require.
One expects offshore wind developers to be cheerleaders for their projects, especially given the massive taxpayer and ratepayer subsidies they are rewarded. But many state and federal policy-makers, who ought to be concerned with the physical and economic realities of offshore wind, refuse to recognize those realities and often attack people who do. But as in the fable of the emperor’s new clothes, the realities will assert themselves regardless.
Ultimately, wind power is an 18th-century solution to 21st-century energy challenges, out of time and place, best left to weekend sailors and readers of swashbuckling novels.
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