Offshore Wind:
On The Horizon
Presentation to the
International Economic Development
Council
October 6, 2009
Session Overview
• The Delaware project
• U.S./Mid-Atlantic offshore wind resource
• Matching Resource to Load
• The Business Opportunities
Delaware’s Approach: RFP to PPA
• State legislation allowed energy
sources to compete to meet demand
• RFP for long-term Power Purchase
Agreement allowed offshore wind to
measure up against coal/natural gas
(made project financeable)
• Offshore wind won because expected
fuel cost increases & carbon fees were
accounted for
• Perfect storm: Strong citizen support/
academic leadership, supportive State
Treasurer (current Governor), and
private sector entrepreneurship
Public Opinion Won the Day
• Citizen support & activism in front of PSC, Legislature
and previous Governor
• Coalition of advocates for addressing climate change,
improving public health, clean energy
• 78% local public approval v. 4% against (19 to 1)
Delaware’s Offshore Project
• Result: Delmarva and Bluewater Wind
agreement for 200-450 MW
– Only offshore wind PPA in USA
– Stable pricing over 25 years
– 30% of residential demand
– Utility commitment to evaluate
additional offshore wind purchases
• Project currently in Delaware
& Federal permitting processes
(MET tower approved)
• Delmarva Power likely to meet 20%
RPS goal 5 years ahead of schedule
(2019)
Delaware’s Offshore Project
• Project Size: 230 - 450 MW
(up to 150 turbines)
• Closest turbine: 12 miles east
of Rehoboth Beach
• Offshore Construction Start
Date: Expected 2013
• Completion Date:
Expected 2013 – 2014
(depends upon project size)
Delaware Furthest Among Planned
Offshore Developments
New Federal Commitment to Wind
 Federal framework for offshore
wind demonstrates Obama
Administration’s commitment
 Integrating offshore wind as a
cornerstone of President’s energy
strategy
 Ensuring ample resources for
research, production, development
& deployment, training
 Streamlining permitting processes
and coordinating/providing
technical assistance for states (EPA,
DOI/MMS, NOAA, DOE, FERC, CEQ)
Vice President Joe Biden and
Delaware Governor Jack Markell
with Dr. Willett Kempton
at University of Delaware
Why Offshore Wind in U.S.?
• The Mid-Atlantic region will be the first
offshore wind market in the U.S.
• Huge offshore resource:
– 835 GW capacity & 330 GW average output
– 185 GW output can supply all East Coast states
(electricity, cars, and building heating/cooling)
– Potential to reduce carbon emissions 68%
• Large, shallow continental shelf
• Expensive fossil fuel electricity regionally
Nearly 80% of U.S. Electricity Demand is in
Coastal and Great Lakes States
Twenty-eight coastal states in contiguous U.S. consume 78% of U.S. electrical energy
Nearly 60% of U.S. Population Lives in
Coastal and Great Lakes States
Twenty-eight coastal states in contiguous U.S. are home to 58% of population
U.S. Wind Resources: Plains & Coasts
Pacific NW
Class 5, 6 & 7
Gulf of Maine
Class 6
Great Lakes
Class 5 & 6
Mid-Atlantic
Class 5 & 6
S California
Class 4, 5 & 6
Great Plains
Class 3, 4 & 5
Southeast
Class 4, 5 & 6
Large shallow areas in NE
Most significant shallow
Outer Continental Shelf area
is in Mid-Atlantic region
Resource Size
Wind is Cost Competitive Today in U.S.
• Offshore wind costs will be
competitive in the Mid-Atlantic
and Northeast earlier than any
other U.S. region
• Grid congestion drives high peak
prices due to limited generation
and transmission
• Majority of electricity from coal
w/ heavy GHG emissions
Peak Pricing (PJM East map, CCFPI)
• Offshore wind generation
addresses cost variability &
health/environmental impacts
2
Transmission
Opportunity
• Connect multiple wind
sites to multiple state loads
• Leveling wind resources
• Avoiding “Spaghetti”
Business Opportunities
•Steel Fabrication
•Nacelle Components
•Gears/mechanical and
electrical
•Blades
Transmission
R&D
Construction
Long Term O&M
Lets Talk About a New American Industry
Thank You
Contact:
Philip Cherry
Policy Director
State of Delaware
Department of Natural Resources &
Environmental Control
(302) 739-9000
Philip.cherry@state.de.us