SACE staff Chris Carnevale and Simon Mahan contributed to this post.
15.7 million people reside in the Southeast Coastal Region – along the coasts of Florida, Georgia, North Carolina and South Carolina. Combined, these states have the greatest regional energy demand in the U.S., and in 5-10 years, that could be matched with one of the greatest energy resources: Southeastern Offshore Wind.
The Departments of Energy (DOE) and the Interior (DOI) combined efforts to set goals in their report, The National Offshore Wind Strategy: Creating an Offshore Wind Energy Industry in the United States. Their aims are to achieve 54 gigawatts (GW) at 7-9 cents/kilowatt hour by 2030 and in the interim 10 GW at 13 cents/kWh by 2020. These rates are competitive with fossil fuels. To put this amount of energy in perspective, 1 GW equals 1,000 megawatts (MW); 1MW is equal to 1 million watts and can power approximately 1,000 homes.
The Southeast is home to about two thirds of the East Coast’s shallow water, offshore wind resource. The offshore wind resource off North Carolina and South Carolina could each provide more electricity than each state currently generates. Georgia’s offshore wind resource could provide nearly a third of the state’s electricity demand. The Southeast now imports its fuel for electricity, mostly in the form of coal from other states, when we could actually be net exporters of offshore wind energy.
In its technical Assessment of Offshore Wind Energy for the U.S., the National Renewable Energy Laboratory (NREL) calculated the combined resource area of Federal waters along the Outer Continental Shelf off Georgia, North Carolina and South Carolina at just under 40,000 square miles. If only a fraction of this potential is developable once environmental issues, marine mammal (whales), avian, shipping lanes and military concerns are taken into consideration, the policy implications of this data are huge.
It is ideal for the development of a regional policy. The continental shelf is our Southeastern common border – quite possibly the most valuable energy asset we have. Leaders in our region are just beginning to recognize the importance of offshore wind. Less than a month ago, Tybee Island passed a Wind Power Resolution, which recognizes the significance of the coastal Southeast’s vast wind resource and its opportunity for clean, renewable economic development.
Then last week, on March 8-9, The Southeastern Coastal Wind Conference – organized by Brian O’Hara, NC Offshore Wind Coalition, Jen Banks, NC Solar Center at NC State University and some 40 organizing partners including SACE – brought 300 of the key decision makers together, exactly those who can develop a regional policy. Among them: Virginia Secretary of Commerce and Trade, James Cheng; Secretary of the North Carolina Department of Commerce, Keith Crisco; South Carolina State Senator, Bradley Hutto; and Georgia Department of Economic Development Project Manager, David Dunagan. Joint economic development would allow all four states to participate and benefit from major developments in the offshore wind industry. A successful regional compact that may provide an example already exists in the Northeast: the Regional Greenhouse Gas Initiative (RGGI) of the Northeast and Mid-Atlantic States.
Did you know there are over 8,000 parts in a single wind turbine? That means that hundreds or thousands of businesses in the offshore wind manufacturing supply chain already here in the Southeast will benefit from offshore wind installations. Navigant is actually working on a state-by-state supply chain optimization of the Southeast, which will give us an independent view of economic benefits we can expect. With the rational development of these resources, and an offshore transmission grid, we may be looking at tens of thousands of new jobs.
Yes, there are hurdles, among them, a restrictive regulatory framework. Fortunately, the DOI has put Smart from the Start into place, a program that facilitates the leasing process and just issued new lease forms, so wind farm development can proceed more rapidly. We need to further streamline the regulatory regime, and get state agencies to collaborate so that project review is reduced. We also need a stable policy that promotes offshore wind energy – like the investment tax credit and production tax credit for wind energy that would level the playing field for clean energy.
Anthony Dorazio, Senior Vice President for Wind Development with Duke Energy Renewables, sat on the Developers Panel (pictured above) and bragged that he is a “wind guy,” so we know our region’s utilities are starting to take notice. When you think about it, this is actually a perfect opportunity for investor-owned utilities, good rate-based assets, no cost fuel resource, they should be on board too!