California’s coming offshore wind boom faces big engineering hurdles

This week, dozens of companies are expected to compete for the right to lease the first commercial wind power sites off the coast of California in a federal online auction that could kick-start the state's next clean energy boom.

Collectively, the winners will pay at least tens of millions of dollars for exclusive rights to submit plans to the Bureau of Ocean Energy Management for wind turbines at five sites that stretch across more than 370,000 acres of the Pacific. Three of the areas are clustered near Morro Bay along the central coast, starting about 20 miles due west from the picturesque seaside town of Cambria. Two more are located off Humboldt County in the north.

Annual average wind speeds around the Morro Bay sites reach 8 to 10 meters per second, exceeding those around some large offshore wind farms already developed in the North Sea. Towering turbines on the locations up for lease could deliver 4.5 gigawatts of clean electricity to the California grid, enough to power more than 1.5 million homes.

The state has an even more ambitious goal: building 25 gigawatts of offshore wind by 2045. That's equivalent to nearly a third of the state's total generating capacity today, or enough to power 25 million homes.

But the audacious plans for offshore wind face a daunting geological challenge: the continental shelf drops steeply just a few miles off the California coast. That makes it prohibitively expensive to erect standard offshore wind turbines, which are set atop fixed structures that extend to the seafloor. The turbines built near Morro Bay and off Humboldt, where water depths reach up to 1,300 meters (around 4,300 feet), will need to be placed on floating platforms, a speculative and very costly technology.

Some companies have begun using such platforms, which are tethered to the sea bottom on moorings, in places such as the coasts of Portugal and Scotland. But these sites still produce relatively little power. To meet its ambitious plans, California will need to develop sprawling fleets of these floating wind turbines very quickly.

The hope is that the state, as a huge consumer of electricity, will provide a giant early market for the technology, helping to scale it up, pushing down costs, and driving innovation in the nascent sector. That would boost US efforts to develop more offshore wind power, a clean energy sector where the nation has long lagged regions like China and the UK. If the floating industry does prove viable, it will also unlock vast amounts of renewable resources around the globe that have largely been off limits to date.

But there are enormous engineering and regulatory challenges ahead. Achieving California's targets could require creating or upgrading ports, constructing new vessels, streamlining permitting processes, building up a West Coast wind manufacturing sector, and shifting to new types of platforms that could be cheaper to deliver and install. And all of that would have to occur at an incredibly rapid pace.

David Hochschild, chair of the California Energy Commission, readily acknowledges the looming difficulties, but he says the state is committed to working through them.

This is a technology that is ripe and ready," he says. We're all in."

High hopes

The appeal of floating wind is obvious. Somewhere around 60 meters deep (nearly 200 feet) it becomes impractical for developers to build what are called fixed wind foundations. But the winds above deep waters far off the coast are often ideal: strong and consistent.

Off Morro Bay and other potential California sites, the winds dip at midday but rise in the early evening, in nearly perfect sync with consumer demand-and in much the opposite pattern from the electricity generated by solar farms.

Those characteristics will help the state's grid operators draw more of their electricity from carbon-free sources through the evening, which will serve an increasingly crucial function as the California power sector moves off fossil fuels, says Alla Weinstein, chief executive of Trident Winds, which is a partner in the Castle Wind joint venture, which is bidding in the auction this week.

The state's climate laws will require 90% of its electricity to come from such resources by 2035. That same year, California will mandate that all new passenger vehicles sold in the state must be zero-emissions, placing growing demands on the grid.

Hochschild says California also hopes a boom in floating wind will spur economic development, including the emergence of a state-based manufacturing sector near ports that could supply turbine blades, towers, and other components. Offshore wind development could spark tens of billions of dollars in investments over the next quarter-century, he says.

In addition to their monetary bids, companies participating in the auction can earn credits by committing to invest in workforce training, support the development of domestic wind supply chains, and engage with indigenous tribes and other underserved communities, among other considerations. These credits will be considered in determining the winner.

But California is pinning a lot of hopes on an industry that scarcely exists today.

SEBASTIEN SALOM GOMIS / AFP VIA AP IMAGES

Only a handful of mostly small demonstration projects have been developed so far, totalling around 125 megawatts, according to a Department of Energy report published earlier this year. The largest floating farm in the world so far is the nearly 50-megawatt Kincardine project off the shores of Scotland. There are also small projects operating in China, Japan, France, Norway, and Portugal, the report notes.

There are big plans to build more globally. The total capacity of projects in the pipeline-including large sites in Australia, Brazil, South Korea, and the United Kingdom-doubled in 2021, to more than 60 gigawatts.

The Biden administration has set a US goal of developing 15 gigawatts of floating wind by 2035 and established a program designed to cut the cost of the technology by 70% over that time. (It's also aiming to build 30 gigawatts of all types of offshore wind by 2030.)

High costs

For now, however, floating wind power remains hugely expensive.

It's hard to put precise figures on the technology today, given the small pool of projects across different regions, but the levelized cost is roughly $200 per megawatt-hour, according to the DOE report. (Levelized costs of energy are the average calculated across a project's lifetime, taking into account the costs of building and operating it.)

Standard offshore wind, land-based wind projects, and large-scale solar farms run around $80, $30 and $35 per megawatt-hour, respectively, according to the US National Renewable Energy Laboratory. That wide gulf will clearly discourage grid operators from signing long-term power purchase agreements unless they're incentivized or required to by policies or regulators.

California's climate laws could do just that, pushing grid operators to source more and more of their electricity from carbon-free sources across more hours of the day, even if it is initially more expensive.

In addition to the high costs, any US floating wind development will also have to grapple with some onerous regulations. Under a century-old law, any ship delivering goods or people from one US site to another must be built, owned, and primarily crewed by American citizens. Past findings and precedents suggest that floating wind sites will fall under those restrictions, says Carl Valenstein, an attorney focused on maritime industries at Morgan, Lewis & Bockius.

The problem is there are limited numbers of compliant ships that could tow out and plant the assembled floating turbines. Foreign-flag vessels could do some of the work on site, and it's possible certain US ships could be retrofitted to achieve some of the tasks. But it's clear the American ship-building sector will need to get moving fast for the US to have any hope of meeting both the fixed and floating offshore wind targets.

At some point in the next year, people are going to have to ask the question: Where are we going to get the ships to implement these plans along the current timelines?" Valenstein says. If a lot of these projects get going, those capacity constraints will be really felt-and you don't get these ships built overnight."

California faces still more challenges. Many of the state's ports are too shallow and its bridges too low to accommodate the giant turbines, towers, and platforms, which are far easier to assemble before they're carried to the offshore site.

In addition, it could cost tens of billions of dollars to develop the electricity transmission capacity needed to plug all the envisioned offshore wind turbines into the grid. California's Independent System Operator, which manages the state's main electricity network, found that just accommodating four gigawatts of electricity from the sites near Humboldt County could cost between $5 and $8 billion.

Finally, there's the question of permitting.

Winning the federal auction is merely the start. Every winning developer will still need to work through lengthy environmental review and approval processes with a variety of federal, state, and local agencies, ultimately securing no fewer than 30 permits. Weinstein says it could take five to seven years.

And Californians have a well-earned reputation for blocking and stalling major developments. They are particularly touchy about coastal projects-whether they can see them or not.

Catching the wind

Despite the challenges, fans of floating wind remain optimistic.

Walt Musial, who leads the research efforts on offshore wind at the National Renewable Energy Laboratory, predicts that costs will come down as the industry moves beyond the pilot scale and developers gain experience building more and bigger floating wind facilities.

Research groups estimate that the costs could fall from around $200 per megawatt-hour to between $58 and $120 by 2030. That would leave floating offshore wind more expensive than solar and onshore wind, but it could still serve an important role in an overall energy portfolio.

The technology is improving as well. Turbines themselves continue to get taller, generating more electricity and revenue from any given site. Some research groups and companies are also developing new types of floating platforms and delivery mechanisms that could make it easier to work within the constraints of ports and bridges.

The Denmark-based company Stiesdal has developed a modular, floating platform with a keel that doesn't drop into place until it's in the deep ocean, enabling it to be towed out from relatively shallow ports.

Meanwhile, San Francisco startup Aikido Technologies is developing a way of shipping turbines horizontally and then upending them in the deep ocean, enabling the structures to duck under bridges en route. The company believes its designs provide enough clearance for developers to access any US port. Some 80% of these ports have height limits owing to bridges or airport restrictions.

A number of federal, state, and local organizations are conducting evaluations of California and other US ports, assessing which ones might be best positioned to serve floating wind projects and what upgrades could be required to make it possible.

Government policies in the US, the European Union, China, and elsewhere are also providing incentives to develop offshore wind turbines, domestic manufacturing, and supporting infrastructure. That includes the Inflation Reduction Act that Biden signed into law this summer.

Finally, as for California's permitting challenges, Hochschild notes that the same 2021 law requiring the state's energy commision to set offshore wind goals also requires it to undertake the long-term planning necessary to meet them. That includes mapping out a strategy for streamlining the approval process.

For all the promise of floating wind, there's little question that ensuring it's cost-competitive and achieving the targets envisioned will require making massive investments in infrastructure, manufacturing, and more, and building big projects at a pace that the state hasn't shown itself capable of in the recent past.

If it can pull it off, however, California could become a leading player in a critical new clean energy sector, harnessing its vast coastal resources to meet its ambitious climate goals.