Via David Wojick
California has set a floating offshore wind capacity target of 25,000 MW. Of course, costs are never mentioned, so this is a rough estimate to start with.
The estimate starts with the massive Dominion Energy (DOM) captive wind project currently under construction off the coast of Virginia. Since the regulated utility DOM is its own developer, we don’t have any public numbers, so this is a rough calculation. Large numbers are rounded for simplicity and ease of remembering.
A. DOM says the 2,600 MW facility would cost $10 billion to build, or about $4 billion/GW. But financing and profitability push that figure to $20 billion or $8 billion/GW, which is called the “revenue requirement,” or the price a payer would pay. We’ll use that number.
B. DOM boasted that it was immune to the massive price hikes that swept the industry because its contracts were in place. Costs rose an estimated 65% across the industry. That pushed fixed bottom line costs to $6.6 billion per GW built and $13.2 billion per GW total.
C. Floating winds are often estimated to be three times stronger than fixed winds because the cost of this large buoy is much higher than the single pile on which the fixed tower rests, plus there are many moorings on the seabed. Off the coast of California, the water is about half a mile deep.
This puts the construction cost at around $20 billion/GW and the total at $40 billion/GW. This figure could be much higher as it has never been implemented.
D. So 25 GW of floating capacity would cost $500 billion to build and a staggering $1 trillion to finance. Note that this does not include the 20 years of costly operations, maintenance, repairs, replacements and decommissioning. That puts it well in excess of a trillion.
This is California’s trillion-dollar floating wind dream.
Now let’s translate that into a potential power purchase agreement (PPA) price. A trillion dollars paid over 20 years is $50,000,000,000 a year. Assuming a 40% capacity factor, that’s 57 cents per kilowatt hour. With the average wholesale price of electricity in California being around 5 cents, that’s an extremely expensive price.
Floating wind power startup costs are nearly 12 times the price of conventional electricity. Floating wind is a crazy policy, even by California’s crazy standards.
Which brings us to something that’s happening right now. The U.S. Department of Energy’s Grid Deployment Office is asking for information and comment on developing a plan for offshore wind transmission for the West Coast. See https://www.energy.gov/gdo/west-coast-offshore-wind-transmission-planning
Here’s the basic message: “The West Coast Offshore Wind Transmission Effort includes a Request for Information to allow individuals and organizations to submit written comments on transmission topics, including location, technology, and policy considerations. The GDO team will consider this input as it prepares recommendations for the West Coast. Feedback must be received by October 3, 2024, and can be submitted by email to [email protected].”
The DOE says the West Coast plan would be similar to the “ACTION PLAN FOR DEVELOPING OFFSHORE WIND TRANSMISSION IN THE ATLANTIC REGION OF THE UNITED STATES.” That action plan comes from the Department of Energy and the Bureau of Ocean Energy Management (BOEM), which is actually building the offshore wind monsters. The plan calls for a massive underground grid along the entire Atlantic coast.
The Atlantic Action Plan envisions specific offshore wind projects growing in number each year, from 30,000 MW in 2030 to 85,000 MW in 2050. Assuming the West Coast plan is as large as the East Coast’s 85,000 MW, that’s a whopping $3.4 trillion worth of floating wind, a technology that doesn’t even exist at commercial scale.
I encourage everyone to comment against this massive floating wind effort. America doesn’t need trillions of dollars in unreliable electricity.
Related
