Offshore Wind Is Likely The Next Big U
The sun sets over The Burbo Bank Offshore Wind Farm off the West Coast of the United Kingdom near Liverpool. Europe has nearly 20,000 megawatts of offshore wind power capacity in operation. (Photo by Peter Byrne/PA Images via Getty Images)
At this moment, 30 megawatts of offshore wind turbines are sending power to Narraganset Electric, the National Grid affiliate serving Rhode Island. They are the only offshore turbines in operation in the U.S., a pittance considering Europe is closing in on 20,000 MW in operation. But in the U.S. renewable sector, offshore wind is generating increasing excitement. Between dropping costs, ambitious state renewable targets, and a host of European developers looking to bring their knowledge stateside, the long-awaited U.S. offshore wind surge is now widely seen as imminent.
When offshore wind debuted in Europe roughly a decade ago, it was an unproven technology and banks remained wary. The first deals required 50% equity backing. Investors have grown comfortable, with some deals now hitting 80% leverage.
In the U.S., new challenges emerge. The biggest difference between the continents is the knowledge base that has been built up in Europe.
“The U.S. will certainly take advantage of the path already travelled by the EU offshore market and will be in a position to catch up in just a few years,” said Alejandro de Hoz, the vice president of U.S. offshore for Avangrid Renewables.
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