DNV is performing due diligence to enable the financing of eight offshore wind projects on the United States’ Atlantic Coast. The announcement follows news from DNV’s Energy Transition Outlook 2024 report, which forecasts that about 10 GW of fixed offshore wind is set to be installed in the U.S. between 2040 and 2050. While the industry has seen headwinds recently, and the latest Energy Transition Outlook has tempered its overall forecast for offshore wind, projects are still moving steadily forward, as reflected by the robust financing activity in the U.S. The offshore wind projects DNV is assessing collectively represent 13 GW of clean energy capacity, which would increase the U.S.’s total wind power capacity by nearly 9% if they become operational.

The technical due diligence DNV is providing to the financial stakeholders for these offshore wind projects is grounded in sound engineering judgement which is very important for developers, lenders and investors. This methodology is an evolution of the company’s proven approach that has enabled on-time financing for thousands of onshore wind, solar, transmission and battery energy storage projects in the U.S. and Canada.

DNV has also established local, in-house expertise around the intricacies of U.S. project finance and the structures that have emerged since the passage of the Inflation Reduction Act (IRA), such as transferability. Many stakeholders in the U.S. offshore wind industry are headquartered in Europe and rely upon DNV for its on-the-ground knowledge of the U.S. financing landscape. For these eight offshore wind projects, DNV is providing pre-commitment and construction monitoring due diligence to ensure all stakeholders understand the risks of the project prior to final investment decision and further capitalize on tax credit monetization opportunities from the IRA. These services are delivered within established financing mechanisms and  processes to ensure on-time closing.

“So far, three of the eight offshore wind projects we’re involved with have reached a final investment decision and the balance is making rapid progress towards this milestone. Our customers are now getting steel in the water and creating benefits for local communities,” said Richard S. Barnes, region president for Energy Systems North America. “We’ve learned that the offshore wind projects getting financed and moving into the development and construction stages are the ones where developers can hit narrow installation windows because they’ve identified and mitigated risks around vessel availability, supply chain, and evolving regulatory requirements.

” DNV’s U.S.-based offshore wind team enabled clients to succeed in California’s 2022 offshore auction, providing in-depth assessments of the technical, societal, and environmental risks around offshore wind development in Oregon and Maine, and are addressing barriers on behalf of the industry to accelerate the deployment of high voltage direct current (HVDC) technology. This regional team is backed up by a global network of experts that has assessed 50 GW of offshore wind energy.

“DNV uses our advisory expertise to help offshore wind projects increase performance and minimize risks. Success relies on understanding the dependencies between different parts of the offshore wind value chain – this is why we take a full lifecycle approach to managing risks and reducing costs,” concluded Barnes.

Today, the Bureau of Ocean Energy Management (BOEM) announced the execution of the nation’s first floating offshore wind energy research lease. The lease area covers a little under 15,000 acres located 28 nautical miles offshore Maine on the U.S. Outer Continental Shelf and could allow for the deployment of up to 12 floating offshore wind turbines capable of generating up to 144 megawatts of renewable energy.

The research array will allow the State, the fishing community, wildlife experts, the offshore wind industry, and others to conduct in-depth studies and thoroughly evaluate floating offshore wind as a renewable energy source in the region. Research conducted on the array will evaluate its compatibility with existing ocean uses and assess its potential effects on the environment, supply chains, and job creation.

“Floating wind opens up opportunities to produce renewable energy in deeper water farther offshore.” said BOEM Director Elizabeth Klein. “Signing the Gulf of Maine research lease demonstrates the commitment by both BOEM and the State of Maine to promote a clean energy future for the nation. It is another example of a successful all-of-government effort to reach the Administration’s offshore wind energy goals and to combat the impacts of climate change.”

Information gathered from the research lease will inform responsible commercial floating offshore wind development in the future and allow BOEM and Maine to capitalize on innovative technology, while protecting local and national interests and industries.

“Clean energy from offshore wind offers an historic opportunity for Maine to create good-paying jobs, reduce our reliance on fossil fuels, and fight climate change by cutting greenhouse gas emissions,” said Maine Governor Janet Mills. “This lease between the State and BOEM to support the nation’s first research array devoted to floating offshore wind technology is the result of extensive engagement with stakeholders and communities across our state to establish Maine as a leader in responsible offshore wind, in balance with our state’s marine economy and environment.”

Since the start of the Biden-Harris administration, the Department of the Interior has approved the nation’s first nine commercial scale offshore wind projects with a combined capacity of more than 13 gigawatts of clean energy — enough to power nearly 5 million homes. In that time, the Department has held five offshore wind lease auctions – including a record-breaking sale offshore New York and the first-ever sales offshore the Pacific Coast and in the Gulf of Mexico. The Department also recently announced a schedule to hold up to 12 additional lease sales through 2028. On August 14, BOEM will hold an offshore wind lease sale for the Central Atlantic, auctioning areas offshore Delaware, Maryland, and Virginia that could generate up to 6.3 gigawatts of clean energy and power up to 2.2 million homes.

BOEM received an application from the State of Maine for a renewable energy research lease in October 2021. On March 20, 2023, BOEM issued a Determination of No Competitive Interest for the area identified in Maine’s application.

BOEM engaged with the State of Maine Governor’s Energy Office throughout the application review and lease development process to develop a lease that yields high-quality research on offshore wind in the Gulf of Maine. On May 24, 2024, BOEM offered a research lease to the State of Maine after completing a Final Environmental Assessment and associated finding of no significant impacts.

As a research lease, the State of Maine or its designated operator will propose and conduct research regarding environmental and engineering aspects of the proposed project. This information will be made public and used to inform future planning, permitting, and construction of commercial-scale floating offshore wind projects in the region.            

Construction activity on the research array is not likely to occur for several years. The lessee is first required to submit a Research Activities Plan to BOEM, which will undergo environmental analysis under the National Environmental Policy Act. Additional details on the timing of construction will become clearer as the permitting process progresses.     

Offshore wind is poised for truly global growth after 2023 saw the second-highest annual installations as well as key policy developments that set the foundations for accelerated expansion of the industry over the next decade.

In 2023, despite the macroeconomic challenges faced by the sector in some key markets, the wind industry installed 10.8 GW of new offshore wind capacity, taking the global total to 75.2 GW. New capacity increased 24% on the previous year, a growth rate the Global Wind Energy Council expects to see continue up to 2030, if the present increase in policy momentum continues. 

In the next ten years, GWEC forecasts that 410 GW of new offshore wind capacity will be installed, bringing offshore wind deployment in line with global targets to install 380 GW by 2030. The majority of that will come at the turn of the decade, with two-thirds installed between 2029 and 2033. This rapid expansion of deployment must be built on a growing collaboration between industry and government and the creation of streamlined and effective policy and regulatory frameworks. 

This anticipated growth will be driven by the arrival of the next wave of offshore wind markets like Australia, Japan, South Korea, the Philippines, Vietnam, Brazil, Colombia , Ireland and Poland – where policy developments and unprecedented focus across governments, industry and civil society is setting the conditions for long-term offshore wind development at scale.

The report outlines a “Global Growth Framework for Offshore Wind” for industry and governments planning to rapidly scale up development covering finance, demand and industrial offtake, supply chain development, permitting, social consensus, workforce development and grid infrastructure. GWEC’s position is that forecasted growth is at risk if this framework is not implemented.

Ben Backwell, CEO, Global Wind Energy Council, said:

“Installing almost 11 GW of offshore wind is the leading edge of a new wave of offshore wind growth. Policy progress – especially across the Asia-Pacific region and the Americas – has set us on course to regularly install record-breaking capacity annually, and pass the 380 GW target set up by the Global Offshore Wind Alliance. That means offshore wind is on course to achieve the tripling ambition set at COP28 in Dubai.

“Offshore wind is now so much more than a  European, Chinese or American story. In the last year GWEC has seen rapid progress in new markets where the key drivers for offshore wind are now in place – from government commitments to sustainable economic growth, to increased consumer demand and industrial decarbonisation.

Rebecca Williams, Chief Strategy Officer – Offshore Wind, GWEC, said:

“Governments around the world are choosing offshore wind for their people and their economies. We have reached the point in mature markets where the technology is now proven to have the ability to  save households money versus conventional energy sources. 

“This new wave of offshore wind markets are taking notice and making progress of their own, in some cases outgrowing the ‘emerging’ label thanks to strong collaboration between industry and policymakers. It is vital to continue that cooperation, particularly in this year of significant elections around the world, to ensure targets become turbines and more markets develop in the wake of this decade’s expansion.”

Steven B. Hedlund, President and Chief Executive Officer, Lincoln Electric, said:

“We are very pleased to be a key sponsor for this year’s global offshore wind report, which highlights several key actions needed for further supply chain investment to increase the installed capacity of wind. The future ambitions of the offshore wind industry depends on an expanding supply chain where advanced technology and automation are going to help drive further expansion. Lincoln Electric is committed to play our part and will continue to invest in advanced technology solutions to help the industry grow.”

José Oriol Hoyos, Chairman and CEO of Iberdrola Renewables International, said

“Iberdrola is proud to once again sponsor GWEC’s Global Offshore Wind Report and show our continued deep commitment to this technology. This year is a major milestone and memorable moment in our journey towards a cleaner and sustainable future in which offshore plays a leading role. I encourage the whole industry to apply the same courage demonstrated to overcoming challenges in the past so next year we can proudly say that another record has been set and we are a step closer to meeting our ambitions.” 

Qiying Zhang, President and CTO of Mingyang Smart Energy, said

” The utilisation of marine energy, especially offshore wind power, plays a vital role to achieve the global energy transition whilst combating climate change and its impacts. As the world’s leading offshore wind turbine manufacturer and marine energy solutions provider, Mingyang Smart Energy is deeply committed to support the dual objective. We believe that through technological innovation, industrialization and global cooperation our industry can further reduce the cost of energy and ultimately help achieve large-scale offshore wind power deployment. We are proud to support this year