Study Says Investing in Offshore Wind Could Deliver Huge Payday
Report could help justify arguments that now's the time to commit to this renewable technology
If the mid-Atlantic region develops a large-scale offshore wind industry, it could create up to 170,000 jobs and provide a big boost to the area's economy, according to a new study prepared by IHS, Inc.
The Atlantic Wind Connection, a Google-backed developer hoping to build an offshore wind transmission system stretching from Virginia to New York commissioned the study, which could bolster arguments that investing in the technology could reap huge economic benefits.
If 7,000 megawatts of offshore wind capacity were developed in the region, the study projected it could increase Gross Domestic Product by $19 billion and boost federal, state, and local revenues by $4.6 billion. The new capacity could power up to 2 million homes.
New Jersey is among several states along the Eastern Seaboard vying to become the hub of a new clean energy sector. Its Energy Master Plan calls for developing more than 1,000 megawatts of offshore wind, and the legislature has passed a law offering up to $100 million in tax credits to a wind manufacturer who locates at a New Jersey port.
“These findings highlight the unique opportunity our nation has for stimulating a brand new industry by developing this limitless, yet untapped resource,’’ said Bob Mitchell, chief executive officer of Atlantic Wind Connection. “A viable offshore wind industry and the AWC backbone transmission line will provide the long-term energy solution to the region that not only delivers offshore wind energy efficiently, but will reduce the grid congestion that increases consumer electricity prices every year.’’
Congestion on the regional power grid is a particular problem in New Jersey, costing consumers more than $1 billion a year. Nevertheless, the offshore wind industry faces numerous hurdles if it is ever to become a reality, including its high cost compared with electricity produced by conventional fossil fuels, particularly natural gas, which is at historic lows.
Offshore wind developers also are working to shorten lengthy permitting processes at both the federal and the state levels. In New Jersey, offshore wind is stalled because the state has yet to come up with a financing mechanism that developers believe will convince financial markets to invest in the sector.
Still, the study suggested, with the right state and federal policies, offshore wind could deliver big benefits.
In the mid-Atlantic region, more than 70,000 direct jobs will be created in the manufacturing sector to meet the demand for wind turbine foundations, hubs, blades, and other parts, the study said. More than 40,000 jobs will be created by businesses that serve the supply chain. Another 50,000 jobs will be created by added economic activity.
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