Trump Targets Offshore Wind Development | US Politics

Impact of a Presidential Order on US Offshore Wind Development

Shortly after assuming office, a presidential executive order issued by Donald Trump presented a potential obstacle to the developing offshore wind industry within the United States.

Halting Federal Leasing

The order, formalized on Monday, effectively suspended federal leasing for offshore wind development on the outer continental shelf. This area is characterized by consistently strong wind speeds due to its distance from shore, while still maintaining reasonable accessibility.

Notably, the order explicitly excludes leases pertaining to other activities. These include, but are not limited to, oil and gas extraction, mineral acquisition, and environmental conservation efforts.

Review of Existing Contracts

Current projects holding signed leases are not immediately affected by this directive. However, the Secretary of the Interior has been instructed to conduct a thorough review of existing contracts.

The aim of this review is to identify potential avenues for contract termination or amendment.

Current State of US Offshore Wind

The offshore wind sector has historically faced challenges in the United States. As of the end of May, only a limited number of offshore wind farms were operational in American waters, representing a total capacity of just 174 megawatts.

This figure represents a small fraction of the global total of 68 gigawatts, with the majority of existing capacity located in Europe and China.

Future Prospects and Biden's Goals

Despite past difficulties, the industry’s outlook was improving. There were 4.1 gigawatts under construction, with an additional 3.4 gigawatts already approved.

Furthermore, 19.8 gigawatts were progressing through the permitting stages. Successful completion of these projects would have significantly contributed to the Biden administration’s objective of achieving 30 gigawatts of offshore wind capacity by the decade’s end.

Attractiveness of Offshore Wind

Although currently more expensive than some other power sources, offshore wind offers advantages due to its consistent output and proximity to major population centers and data centers.

In Europe, data center operators have actively sought agreements for offshore wind power. For example, Google entered into an agreement last year to purchase 478 megawatts to power two data centers in the Netherlands.

Challenges in the US Market

In the U.S., the development of offshore wind has been hindered by public opposition and insufficient infrastructure for turbine construction and installation.

The availability of suitable land with strong winds in inland areas has also favored the development of onshore wind farms.

Global Implications

Given that the majority of offshore wind development takes place internationally, Trump’s executive order is unlikely to eliminate the industry entirely.

Instead, the sector is anticipated to continue maturing in other nations, allowing companies to build expertise while awaiting potential changes in the U.S. market.