Status of Offshore Wind Energy Projects, Policies and Programs in the United States Page: 4 of 14
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United States. The Wind Deployment Systems (WinDS) computer model developed by the National
Renewable Energy Laboratory (NREL) for DOE  was used to analyze the U.S. electricity grid.
WinDS is a multi-regional, multi-time-period, geographical information system (GIS) and linear
programming model of capacity expansion in the U.S. electricity sector. Although WinDS is
designed to address the global market issues, it does not look at a wide variety of local, state, or
federal incentives that create a high degree of regionally-dependent economic variability for
offshore wind. Nevertheless, two assessments recently conducted by NREL found that offshore
wind could contribute significant new capacity to the energy supply by 2030. One study evaluated
the potential for wind energy to meet 20% of the U.S. electric supply . In this analysis, offshore
wind provided 54 of the more than 300 gigawatts (GW) of total installed wind power capacity. The
second assessment looked at specific input assumptions that were found to correlate with high
offshore wind energy generation expansion rates . Under one scenario in this study, WinDS
predicts that 78 GW of offshore wind will be built. The details of both of these studies are
summarized in a recent NREL report on offshore wind energy. 
These analyses demonstrated that offshore wind energy can be a major contributor to the future
energy mix on the U.S. electricity grid. While these analyses assumed significant cost reductions of
25% to 35% to achieve these levels of expansion, they did not include many of the financial
incentives, regulatory requirements or climate change initiatives that might influence project
developers and decision makers in moving forward with offshore wind projects. The cost
reductions can be achieved through a combined effort of incremental research and development
(R&D) innovations and learning curve benefits realized through future deployments planned in both
the United States and in Europe. A potentially more difficult side of offshore wind energy
development involves public policies, new leasing requirements on the outer continental shelf,
assessing potential environmental and health risks and public engagement strategies.
Turbine Supply Shortages
Today, the land-based wind energy market in the United States is providing turbine manufacturers
with an outlet for any turbines produced during the next two years. This is resulting in turbine supply
shortages both for land-based and offshore projects . With lower risk land-based opportunities,
offshore developers are finding it increasingly difficult to obtain serious quotes from offshore turbine
suppliers and hence the price for turbines has been inflated and is very speculative. This has
obviously had at least a short-term negative impact on the initiation of an offshore wind energy
industry in the United States. This problem may be remedied by the possibility of more offshore
turbine manufacturers entering the marketplace in Europe during the next few years.
The regulation and permitting of offshore wind turbines were not addressed by federal authorities
and legislators in the United States until almost 4 years after the first project was proposed by Cape
Wind Associates in 2001. The Energy Policy Act of 2005 (EPAct) granted authority to regulate
offshore wind turbines on the outer continental shelf (OCS) to the Minerals Management Service
(MMS); the agency that is currently responsible for the regulation of oil and gas . This authority
includes any project that extends outside of 3 nautical miles (nm) from the shore. (In the case of
Texas and the Florida Gulf coast, this boundary is set at 9-nm.) Projects inside of 3-nm are under
the jurisdiction of the individual state governments but must still abide by several federal laws. The
two projects that were already in the permitting pipeline (Cape Wind and LIPA) were granted
exemptions in EPAct 2005 that allowed them to proceed with their permitting and environmental
assessments while new federal rules were being developed. All other project proposals were put
on hold until these new rules are issued by MMS. This temporary hold on new projects included not
only the permitting process for wind turbine installations, but also the installation of meteorological
towers and data collection needed to support site evaluations. In November 2007, MMS announced
an interim policy for limited term leases to allow developers or researchers to install anemometer
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Musial, W. & Ram, B. Status of Offshore Wind Energy Projects, Policies and Programs in the United States, article, January 1, 2008; Golden, Colorado. (digital.library.unt.edu/ark:/67531/metadc900920/m1/4/: accessed December 17, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.