Equilibrium & Sustainability

Supply chain to support Biden’s offshore wind goals will cost at least $22.4B: report

Fulfilling President Biden’s goal of deploying 30 gigawatts of offshore wind by 2030 would require the rapid scale-up of a domestic supply chain and at least $22.4 billion in infrastructure investments, a new report has found.

The success of such a build-out would rely upon “resilient, sustainable and equitable manufacturing” of primarily U.S.-based facilities, ports and vessels, according to the report, published by the National Renewable Energy Laboratory and other partners on Monday.

While the necessary investments would be substantial, individual states and companies could leverage existing manufacturing capabilities to create a new workforce and bring economic benefits nationwide, per the report, released with the Business Network for Offshore Wind.

“A manufacturing supply chain is already emerging in more than a dozen locations up and down the U.S. coast in support of the offshore wind industry,” Ross Gould, vice president for supply chain development and research at the nonprofit, said in a statement.

“To meet our ambitious clean energy national goals, American manufacturers must play a larger role to accelerate our transition,” Gould added.

Building a domestic supply chain for offshore wind energy in the U.S. would require a minimum investment of $22.4 billion and take six to nine years to develop, according to the report.

The supply chain would involve at least 34 new manufacturing facilities — with each major construction project costing between $200 million and $400 million and taking three to five years to complete, the research found.

Among such facilities are fixed-bottom and floating ports, large installation vessels and U.S.-flagged feeder barges, according to the report.

The estimated $22.4 billion total, however, does not include support vessels, workforce training programs and the expansion of existing businesses in supporting supply, the authors warned.

Meanwhile, as a domestic supply chain ramps up manufacturing during the 2020s, the U.S. offshore wind sector will likely need to import between 15 and 25 gigawatts worth of components to meet its 2030 deployment targets, the research found.

Yet lower transportation costs, avoided tariffs and incentives from the Inflation Reduction Act — the Biden administration’s climate spending package — could help domestically produced components become competitive with imported ones, according to the report.

A domestic offshore wind supply chain could also generate about 10,000 full-time jobs in manufacturing sites by 2030, the authors found.

For every job created in such facilities, there is a chance for up to five supplier jobs in the production of associated items like parts and materials, the research determined. 

As a result, most U.S. states with existing manufacturing capabilities could participate in the offshore wind supply chain — even if they do not have wind energy or a shoreline themselves, according to the report.

The research also stressed the importance of meaningful engagement with local groups and with those individuals who would be most directly affected by offshore wind supply chain manufacturing projects.

Decisionmakers would need to operate with transparency and accountability, while embracing the idea that there is “no one-size-fits-all benefit” that will fit all community groups and stakeholders, according to the report.

The authors encouraged states to seize what they described as “a unique opportunity to create a substantial domestic manufacturing industry” with a “stable pipeline of well-paid jobs.”

“If we can develop this supply chain in parallel with deploying the first wave of projects in the United States, the domestic industry will be well-positioned to reliably support the expansion of offshore wind energy to help facilitate the transition to a decarbonized economy,” the authors added.

Tags Biden Climate change Joe Biden offshore wind energy Renewable energy

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