With the rapid progression of new projects on the East Coast of the USA, there are massive opportunities, but also some doubt. With over 9 GW of wind farms planned, where will the supply chain come from?
Obviously the country has a large industrial resource and many construction and fabrication companies, as well as enormous experiences from Offshore Oil and Gas. However, it is recognized by experts in the field that there will be shortages of domestic industry and skills, which will need to be supplied, most probably from Europe. The outlook is for around 2000 foundations and turbines, plus onshore and offshore cabling and infrastructure – a large market to be satisfied.
Some companies are already gearing up to serve offshore wind using manufacturing capacity in the US. Nexans, for example, will be delivering locally-made cable, says Maxime Toulotte, head of technical marketing. Jason Folsom, national director of US sales at the turbine manufacturer MHI Vestas, believes it would be advisable for America to create a purpose-built supply chain.
Vessels – The Jones Act Provides Challenges
Vessels are a particular concern for the offshore wind sector because of the requirements of the Jones Act, which says goods shipped between US ports must be transported on ships that are built, owned and operated by American citizens or permanent residents. Experts concede that it is too late to build Jones Act-compliant vessels for the construction of early wind projects going into the water in the next couple of years.
This means the US shipping industry will have to meet demand with non-optimum vessels, although insiders believe this will not be an insurmountable challenge.
“There are new ways of approaching this versus the traditional jack-up transfer,” comments Michael Braid, divisional director at Clarksons Platou Offshore, which works in offshore wind due diligence and vessel procurement.
And Paul Gallagher, vice president at FOSS Maritime Company, a marine transportation company, says there are lots of vessel options to put on the table. “I think we have a great set of resources here in the United States,” he says.
Josh Diedrich, director of business development at the shipbuilder WindServe Marine, believes that apart from installation vessels, the US has what’s needed. “Is it ideal and perfect? No,” he says. “But we have the resources and skilled personnel to make it happen.”
In the long run, he says, creating a new supply vessel model for offshore wind, with less dependency on the specialist jack-up vessels use in Europe, might benefit the industry. Even established shipbuilders such as Fred Olsen Windcarrier are waiting to see how the US market will evolve before choosing to invest in European-style vessels. “It’s difficult at this point in time to say which solution is the most efficient one,” says Eskil Røset, senior project manager at Fred Olsen Windcarrier.
So far there have been no fully acceptable solutions to this dilemma and everyone is waiting to see how things will pan out.
Workforce and Skills Development
Alongside vessels and manufacturing facilities, the US offshore wind supply chain will require a major workforce and skills input. Indeed, jobs creation is acknowledged as one of the big attractions of offshore wind for Eastern states. In theory, the appetite for local job creation should indicate that there is plenty of human resource that the industry can take advantage of.
However, project development will require quite specific skills, according to Jen Cullen, permitting and outreach specialist at Vineyard Wind. “The major one is ensuring that workers have the proper safety training,” she says.
The most important skill to acquire will be Global Wind Organization (GWO) basic safety training, she says. Jennifer Menard, vice president of external affairs at Bristol Community College, home of the National Offshore Wind Institute, agrees that safety training is critical. The College has been working with UK experts on the development of courses suitable for the US market. “I think we are ready to get ahead of the basic safety training and basic technical training,” says Menard.
Neil Brown, business development manager at JDR Cables, a market leader in inter-array cables, says GWO training is “an absolute” but is not the only training that is required. JDR is also looking to participate in delivering technical modules perfected on projects such as Hornsea in the UK, the world’s largest offshore wind project. “There are very specific skills sets required to terminate array cables,” Brown says. “There have been a lot of lessons learned in Europe. We want to bring those across,” he says. “Part of that is us commissioning a training program to guarantee quality of workmanship offshore. Our intention here is to develop a self-sustaining team in the US.”
The recent announcements by New York and Baltimore (see previous blogs here and here) will provide support for infrastructure and skills, and BOEM is cognizant of the need for training, so institutions are aware of these industry needs.
Case study: Massachusetts Sets Up for
Supply Chain Success
While numerous East Coast states are making strides in developing the supply chain for offshore wind, perhaps none have gone to the lengths seen in Massachusetts. Coordinated by MassCEC, the state has made significant efforts to engage supply chain stakeholders with a view to turning the City of New Bedford into a major hub for offshore wind.
“MassCEC’s offshore wind program is to advance and support responsible development of offshore wind in Massachusetts,” says Bruce Carlisle, senior director for offshore wind at MassCEC. “It’s about finding opportunities and working with collaborators to realize them.”
MassCEC has been working with stakeholders such as BOEM since 2009, and leading research on fisheries, marine mammals, transmission and port infrastructure, among other topics. With clean energies, “we try to get involved very early on,” says Stephen Pike, MassCEC’s CEO. “An opportunity that the state identified well over a decade ago was port infrastructure.”
As a result, the state set about upgrading the New Bedford Marine Commerce Terminal to support offshore wind projects. Massachusetts has also developed the first US commercial-scale blade test facility, with capacity for blades up to 90 meters long. This effort is paying off at Vineyard Wind, the country’s first commercial-scale offshore wind farm.
Lars Thaaning Pedersen, Chief Executive Officer at Vineyard Wind, says: “MassCEC is a pivotal player in bringing offshore wind into fruition and bringing the industry to where it is now.”
Massachusetts sees offshore wind as being part of a wider ecosystem promoting business innovation. The state has added around 200,000 jobs in the last four years, with unemployment now at just 2.9%. It is also number one in the US in research and development spending per capita and as a percentage of gross domestic product, and is the best educated state, with nearly 45% of adults holding a college degree.
“This is an incredibly innovative ecosystem to do business with,” says Mike Kennealy, secretary of the Massachusetts Executive Office of Housing and Economic Development.
While Massachusetts is clearly positioning itself to seize a significant portion of the offshore wind industry supply chain, many observers believe it will be important for the state to collaborate with others on a regional level. And even though New England governors have a long history of cooperation on energy issues, there have also been hiccups in the past. Work on a six-state energy procurement plan hit a brick wall in 2013.
Nevertheless, says Eric Wilkinson, general counsel and director of energy policy at the Environmental League of Massachusetts: “The time is right now to reassess the process for regional offshore procurement here in New England. We badly need greenhouse gas reductions and there’s economic opportunities as well.”
The supply chain in the USA is far from complete, yet many of the major players in the sector are making considerable steps forward to ensure that there will be domestic support as the industry grows over the next few years.
The US offshore wind market is probably the most rapidly-developing renewable energy sector in the world. Follow #USOW20 for the latest news and expert opinions.
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