The industry's importance to the Biden administration's green energy plans, as well as the intractable nature of its serious financial problems, make it a prime candidate for government intervention
America is preparing to spend trillions of taxpayer dollars to install offshore wind turbines for illusory benefits.
Advocates claim offshore wind energy is clean and sustainable. Wind certainly is, but that doesn't mean getting energy from wind is. (1)
A recent study by energy analyst David Wojick devastates the repeatedly invoked justification that CO2 emissions will be cut. His report, "How Offshore Wind Drives Up Global Carbon Emissions," explains why adding offshore wind to our energy mix 'will likely increase global CO2 emissions. (2)
Dr. Wojick's study exposes the frightening fact that an honest, complete analysis of offshore wind costs and benefits, including purported atmospheric CO2 reductions, have never even been attempted.
These numbers are huge, but the situation is actually much worse.
This is because offshore turbines generate less than 40% of their rated capacity. Why? Because often there's no wind at all for hours or days at a time. This requires a lot of extra capacity, which means a lot more windmills will have to be erected to charge millions of huge batteries, to ensure stable, reliable electricity supplies. (1)
Another item of concern: Despite offshore wind farms dealing in a kind of mechanical hell of high speed salt water spray, big waves, and volatile wind conditions, surprisingly 85% of the insurance claims are because the underwater cables are failing. If the subsea cables can't be insured, it's another unexpected cost threatening the economics of offshore wind. (3)
The underwater cables needed for offshore wind are apparently so costly to repair, and the losses from lack of generation are so steep, that they are in danger of becoming uninsurable. Imagine if an entire coal plant was connected to the grid through one long cable buried under the ocean, and when the cable failed it took months to find and repair, during which time the plant could not earn a cent.
The renewable power fantasy is being blown apart by furious financial headwinds. (4)
There is carnage in Europe. Orders and profits are collapsing.
Europe's bid to expand its green industry faces a host of challenges including high energy costs and supply chain issues. European products are more expensive to build.
The value of Danish energy company Orsted, the world's largest offshore wind farm developer and a big player in the US, has plunged about 31 percent since it declared $2.3 billion in US impairments in late August due to supply delays, high interest rates, and a lack of new tax credits. (5)
Already this year projects have tumbled in Rhode Island, Connecticut, and Massachusetts, and now Orsted has cancelled two wind farms in New Jersey. Over and over, the litany of causes is the same: inflation, higher interest rates that drive up capital costs and severe kinks in the supply chain. (4)
These same problems are slamming proposed offshore wind projects in New York as developers make final decisions on whether to start building turbines or cut their losses before they get worse.
Other Developers such as Shell and Avangid are also pulling out of contracts to build offshore wind farms.
In England the myth that energy bills would come tumbling down thanks to the abundance of cheap offshore wind power has finally been blown to smithereens by the failure of the latest auction for the Contracts for Difference (CfD) subsidy scheme to attract any biders.The government's price cap was simply not economically viable.
This follows the Swedish energy firm Vattenfall's recent decision to cancel its giant 1.4 GW Norfolk Boreas project before construction had begun. Boreas had been awarded a CfD in last year's round. (6)After suffering a 36% fall in June due to unexpectedly bad maintenance bills, Seimens Energy has lost another 37% as it revealed orders and revenue would be even lower than the current subdued expectations. The share that sold for 24 Euros in May is now selling for 7. ( 7)
Danish Vestas chief admits that telling people that wind can only get cheaper--'was a mistake.' Vestas is down 30% this year. (8)
The costs associated with US offshore wind projects have risen by 57% since 2021 due to inflation in components and labor costs, as well as rising interest rates, leading to a large number of cancelled or negotiated deals. (9)
The recent cancellations of major offshore wind projects have erased billions of dollars in planned spending and put at least 9.7 additional gigawatts of offshore wind projects in the US at risk.
Despite the financial crisis in offshore wind energy, the Biden administration is persevering with its goal of achieving 30 GW of offshore wind energy capacity by 2030.
The industry's importance to the Biden administration's green energy plans, as well as the intractable nature of its serious financial problems, make it a prime candidate for government intervention.
A bailout package for the struggling offshore wind industry may be imminent if the industry's struggles do not abate soon. The Biden administration has heavily subsidized the industry as part of its wider climate agenda, but inflation, supply chain backups , high interest rates, and logistical difficulties have severely impacted its prospects in recent months, prompting many companies to signal that their offshore wind investments are in distress. (10)
Read next: Time to Take Down Industrial Wind Turbines!
Email Us | Reader Friendly | Comments
