Advancing Clean Energy: Cost and Policy Options Analysis for Statewide Offshore Wind Procurements

This thesis describes the process in which a non-profit group provides expert guidance to a state government for an offshore wind procurement, which I recently participated in. It then details the initial reactions to that process from officials, local media, and engaged members of the public. Such examples of expert guidance have been published by the Special Initiative on Offshore Wind (SIOW) for the state of New York, the Commonwealth of Massachusetts, and, as described here, the state of Delaware. Discussion is mostly focused on wind procurement potential for Delaware, following recent publication of the SIOW cost analysis report for this state. Chapters 2, 3 and 4 of this thesis paraphrase data and context from the Delaware SIOW report, which was written by myself and three other authors. The remaining sections are my analysis of the reactions to the report. This thesis begins with context about the offshore wind industry in Delaware and in nearby states. It also includes an explanation of an offshore wind procurement process. Then, the literature review considers existing research on the national and state wind power markets, external benefits of wind power, and pricing systems that a state may choose for a wind power solicitation. The methodology section introduces the two primary topics for further discussion: cost analysis and state options presented by the SIOW report, and stakeholder feedback and reactions to the report itself. In-depth results are then provided in these subject areas. The calculated price point estimate for a Delaware offshore wind farm of 800 MW is $71.48/MWh, which is within the range of recent Delmarva wholesale electricity purchases. If human health and environmental factors are considered, the price of wind power is half that of Delmarva’s recent purchase price. Options for Delaware to consider in a procurement are then provided, ranging from cost-saving metrics to job-creating initiatives. Several stakeholder meetings and media releases are also analyzed between publication of the SIOW report and May 13th, 2022. Initial data from these sources suggested that the offshore wind conversation has restarted in Delaware due to the SIOW report, but that state leaders are still reluctant to take action. Finally, the discussion expands to the impact of the 2016 Massachusetts SIOW report, and how this illustrates the effectiveness of pre-procurement analysis. With growing international demand for offshore wind power, this thesis concludes that pre-procurement cost analyses and guidance on the procurement process enables successful offshore wind solicitations.
Wind procurement, Wind industry, Wind power