The following excellent analysis by Robert Bryce shows the offshore wind industry for what it is – a massive Ponzi scheme subsidised by we overburdened electricity and tax payers as the cost of everything continues to increase with no end in sight.
Although Robert of course takes a look at the offshore wind industry in the U.S. the same template and propaganda is being used by the industry here in the UK and around the world, with many of the same players.
Jessica Mitford was once dubbed the “Queen of the muckrakers.” A British aristocrat, she wrote two landmark books. The first was The American Way of Death, published in 1963, which exposed the abuses of the funeral industry. Three decades later, she published The American Way of Birth, which spotlighted the medical profession’s efforts to outlaw midwifery and increase profits for doctors and hospitals. One review called it “an indictment of the medical practices surrounding something that should not make us sick — giving birth.”
Mitford’s muckraking comes to mind as the massively hyped offshore wind industry collapses under the weight of higher interest rates, supply chain problems, and cost increases. The most recent evidence of the collapse came last week when the Danish company, Orsted, the world’s largest offshore wind developer, announced it was abandoning plans to build two huge wind projects offshore New Jersey with a total capacity of 2,000 megawatts.
I reported on the offshore wind sector’s woes last month in these pages, noting that “Avangrid, a subsidiary of the Spanish utility Iberdrola, announced that it was abandoning the 804-megawatt Park City Wind project offshore Connecticut because the project was ‘unfinanceable.’”
More than half of all U.S. offshore wind contracts, according to BloombergNEF, “have been terminated this year or at risk of being ended.” Among the losers: BP and Equinor, which wrote down the value of their offshore projects in New York by $840 million. The catastrophe led a BP executive to declare last week that “offshore wind in the U.S. is fundamentally broken.”
Jessica Mitford in a 1988 appearance on the British TV show After Dark. Photo: Wikipedia.
The offshore wind trainwreck brings to mind my favorite Mitford quote: “You may not be able to change the world, but at least you can embarrass the guilty.”
It’s time to embarrass the guilty. For years, the largest climate NGOs in America — with a willing assist from legacy media outlets — have been hyping offshore wind and claiming it is an essential part of our decarbonization efforts. Consider these quotes from a 2016 press release issued by Environment New York, which was published after then-New York governor Andrew Cuomo said he would push for offshore wind.
Kit Kennedy, Energy & Transportation Program Director at the Natural Resources Defense Council: “New York’s commitment to developing responsibly sited offshore wind is yet another commitment to the state’s climate and clean energy leadership. Governor Cuomo’s bold leadership is a vital step in helping the state meet its ‘50 by ’30’ clean energy goals, ensuring cleaner air and lower electricity systems costs for all New Yorkers.”
Catherine Bowes, Senior Manager at the National Wildlife Federation: “New Yorkers have much to celebrate with Governor Cuomo’s announcement that New York State will bring new, bold leadership in pursuit of offshore wind power. With a massive, untapped pollution-free energy source available right off our shores, we have no time to waste.”
Lisa Dix, Senior New York Representative of the Sierra Club: “We applaud Governor Cuomo’s announcement that the state will take a step in the right direction to seize the opportunity to move offshore wind forward, further building New York into an economic powerhouse fueled by renewable energy... Offshore wind has the potential to power millions of homes while creating tens of thousands of new jobs in the state, all while protecting our environment and coastal communities from the worsening impacts of climate disruption.”
Heather Leibowitz, Director for Environment New York said: “We look forward to working with state leaders and other stakeholders in the efforts to capture this immense pollution-free resource and move the Empire State to 100 percent renewable energy.”
Legacy media outlets also should be embarrassed. Few are guiltier of hyping offshore wind than National Public Radio. Ten months ago, NPR ran an article headlined, “Biden's offshore wind plan could create thousands of jobs, but challenges remain.” The article lauded President Joe Biden’s plan to install “30 gigawatts of offshore wind online by 2030” a move “that will require thousands of new jobs, especially in the construction sector. It's one of the reasons why President Biden often brings up the idea of new economic opportunities when he talks about tackling climate change.” The piece concluded with this bit of opinion, a line that could have been written by the NRDC: “With hundreds of square miles of untapped potential along American shores, offshore wind will grow exponentially in the coming years, and both American workers and the environment will benefit from it.”
Last week, after Orsted canceled its offshore wind project in New Jersey and said it would write off some $4 billion, NPR reported that the company’s “financial challenges mirror those facing the nascent industry.”
Nascent industry? Hardly.
As I wrote in Forbes in 2021, “Over the last two decades, numerous offshore projects, including the ill-fated 468-megawatt Cape Wind project, have been scuttled, delayed, blown off course, or abandoned.” Recall that in 2001, the backers of Cape Wind filed their first permit application. It would become one of the most contentious energy projects — of any kind — in US history. Cape Wind was officially deep-sixed in 2015.
Credit: Financial Times/BloombergNEF
The history of offshore wind is littered with failure and unfulfilled promises. In 2010, Google announced the Atlantic Wind Connection, an offshore transmission project that aimed to connect 6,000 megawatts of offshore wind capacity. Back then, Google said, “We believe in investing in projects that make good business sense and further the development of renewable energy.” Google (now Alphabet) and three other partners, including Marubeni Corporation, said they would spend $5 billion on the project. The project was quietly killed less than two years later.
In 2011, then-Interior Secretary Ken Salazar spoke at a conference sponsored by the American Wind Energy Association at which he declared, “From Texas to Oregon, to up and down the Atlantic Coast, there’s movement on offshore wind.” He continued, saying the Obama administration had set “an ambitious — but achievable — goal of deploying 10 gigawatts — that’s 10,000 megawatts — of offshore wind generating capacity by 2020, and 54 gigawatts by 2030.”
These cancellations are great news for our whales, our oceans, fishermen, and ratepayers.
The only thing surprising about the collapse of the offshore wind industry — and the Biden administration’s plan to build 30 gigawatts of offshore capacity in less than a decade — is that anyone is surprised by this collapse. As I noted last month, the only thing dumber than onshore wind energy is offshore wind energy.
I will end by repeating a point I have been making for 15 years. We need a sober approach to decarbonizing our electric grid. If we are serious, we have to focus on energy sources that are low-carbon, mature, have high power density, and are scalable. That means N2N, natural gas to nuclear.
I couldn’t help but notice in Robert’s chart above that an offshore wind project by Avangrid CIP was one of only two which are currently proceeding in the U.S. As I have previously mentioned ad nauseum, our beautiful ancient landscapes of Wales have been targeted for desecration and destruction by novice wind developer, Bute Energy with the financial backing of Copenhagen Infrastructure Partners aka CIP for the sake of profits for themselves and their shareholders.
The following is a recent article about Avangrid CIP’s offshore Vineyard Wind 1 project in the U.S. “the nation's first utility-scale offshore wind energy project over 15 miles off the coast of Massachusetts.” It speaks to the incredibly lucrative nature of what is in my opinion, the wind industry’s Ponzi scam.
Denmark-based Copenhagen Infrastructure Partners (CIP) and Avangrid have secured a USD 1.2 billion first-of-its-kind tax equity package for the 800 MW Vineyard Wind 1 offshore wind project in the US.
The investment transaction, which CIP said is the largest single asset tax equity financing and the first for a commercial-scale offshore wind project, was reached with three US-based banks, namely J.P. Morgan Chase, Bank of America, and Wells Fargo.
CCA Group, Santander Corporate & Investment Banking, and Kirkland & Ellis LLP served as financial and legal advisors to Vineyard Wind 1, CIP, and Avangrid.
“Finalizing this tax equity transaction is a critical milestone in executing the financing plan for Vineyard Wind 1. It will allow us to continue financing the project to make it operational,” said Pedro Azagra, Avangrid CEO.
“Closing on a tax equity package has always been a central element to achieving financial success for the first-of-its-kind Vineyard Wind 1. With this investment, Vineyard Wind 1 moves Massachusetts closer to its goal of reducing greenhouse gas emissions by 50% by 2030,” said Tim Evans, partner and Head of North America for CIP.
In 2021, Vineyard Wind, a 50/50 joint venture between Avangrid and CIP, raised USD 2.3 billion of senior debt through nine international and US banks to finance the construction of the offshore wind project.
The wind farm’s offshore construction began in late 2022 while the first steel-in-water was achieved in June this year. A month later, the country’s first offshore substation was installed by DEME’s specialised floating installation vessel Orion.
Located more than 15 miles off the coast of Massachusetts, Vineyard Wind consists of an array of 62 GE Haliade-X 13 MW wind turbines that will generate 800 MW of electricity and power over 400,000 homes.
Power purchase agreements (PPAs) have already been signed with National Grid, Eversource, and Unitil.
The project is expected to save ratepayers USD 1.4 billion over the first 20 years of operation and to reduce carbon emissions by more than 1.6 million tons per year.
The Vineyard 1 deal is also notable for including the private corporation that is the National Grid. The following is an excerpt from the excellent article, National Grid’s Evolution: Branching Out from Deep Rootsby Sonal Patel published by Power Magazine 1 November 2023.
Today, National Grid plc. is still an energy behemoth with nearly 30,000 employees. In the UK, it operates several core, regulated businesses focused on electricity transmission and distribution. These include National Grid Electricity Transmission (NGET), which owns and operates the high-voltage transmission network in England and Wales. The entity in April 2023 opened a new unit, Strategic Infrastructure (SI), which works to deliver transmission projects through the UK’s Accelerated Strategic Transmission Investment (ASTI) framework, armed with a critical objective to connect 50 GW of offshore generation by 2030.
National Grid Electricity Distribution (formerly WPD), another core business, owns and operates electricity distribution networks for the Midlands, the South West, and South Wales. Combined, that network makes National Grid the “largest distribution network operator (DNO) group in the UK,” the company noted. In mid-2023, National Grid’s distribution network connected 11.3 GW, 7.5 of which was “low-carbon generation.”
Meanwhile, though the company divested its giant historic gas distribution business in 2017, National Grid still functions as the UK’s Electricity System Operator (ESO). The affiliate, however, is slated to transfer out of the company’s structure and become part of the UK’s newly created Future System Operator (FSO) in 2024 (along with National Gas Transmission, a licensed gas system operator). As FSO, the ESO will likely assume its current responsibilities.
Today, the National Grid business, regulated by the UK Office of Gas and Electricity Markets (Ofgem), moves more than 730 GWh every day across Great Britain, using infrastructure owned by the country’s three transmission companies: NGET, Scottish Hydro Electric Transmission, and SP Energy Networks. It also oversees reliability measures and executes decisions to keep the system reliable. These, for example, include contingency coal contracts for the upcoming winter and what it says is a “world-leading” demand flexibility service that brings forward “future system flexibility by several years.” After 2024, as FSO, the entity will evolve into an impartial, “trusted and expert body at the center of the gas and electricity systems,” with “an important duty to facilitate net zero whilst also maintaining a resilient and affordable system,” Ofgem says.
[…]
Branching Out in the U.S.
National Grid’s U.S. operations are housed under its National Grid North America segment. These entities own and operate transmission facilities, power distribution networks, and gas distribution networks across Massachusetts, New Hampshire, Vermont, and upstate New York. (It recently sold its Rhode Island business to PPL). Entities include Niagara Mohawk Power, Massachusetts Electric Co., New England Power Co., the Brooklyn Union Gas Co., KeySpan Gas East Corp., Boston Gas Co., and National Grid Generation.
In New England, to meet Massachusetts’ net-zero goals by 2050, National Grid’s utilities are heavily invested in electric vehicle adoption and energy efficiency programs, along with exploring new energy options like geothermal (Figure 2). In New York, the group has embarked on Smart Path Connect‚ an ambitious 100-mile transmission project that could reduce congestion during peak hours and unlock new renewable electricity potential. Another potential energy solution underway is HyGrid, a gas decarbonization project on Long Island that is slated to demonstrate the use of hydrogen in its gas networks.
National Grid Ventures (NGV), another business segment, runs separately from the group’s regulated operations. NGV owns and operates energy businesses in competitive markets in the UK and U.S., armed with a portfolio that includes five electricity interconnectors that connect the UK with the Netherlands, Belgium, Norway, and two connections to France. A sixth interconnector to Denmark (Viking Link) is under construction. When it becomes operational in early 2024, it will expand NGV’s portfolio of interconnector capacity to 7.8 GW. NGV also operates the Isle of Grain LNG facility, the UK’s liquefied natural gas (LNG) gateway to the European energy market.
NGV’s power generation business—a fraction of National Grid Group’s overall operations—is wholly based in the U.S. These include large-scale renewable generation and battery storage in varied states. In 2022, notably, NGV partnered with RWE to acquire a seabed lease for offshore wind in the New York-New Jersey Bight, with the potential to host 3 GW of capacity. NGV is also part of a consortium led by the New York State Energy Research and Development Authority (NYSERDA) seeking federal funding for a hydrogen hub. Finally, but just as notably, NGV also owns a 4-GW fleet of oil- and gas-fired power units on Long Island. It sells all that capacity to the Long Island Power Authority via a power purchase agreement slated to end in 2028. (Continued at source.)
It’s been called the “Louisiana of the East Coast” and the “Saudi Arabia of North America.” Massachusetts is poised to become the hub of the nascent offshore wind industry.
On April 23, the state’s electric distribution companies — Eversource, National Grid and Unitil MA — will select up to two bids from three companies to provide 800 megawatts of wind energy and related transmission infrastructure. In the running are Deepwater Wind, Orsted and Vineyard Wind, one or two of whom will build enormous turbines south of Martha’s Vineyard.
Only one of those companies will provide direct benefits — economic and otherwise — to Cape Cod. And that’s Vineyard Wind.
As always with these proposed wind industry projects there is the promise of thousands of jobs – “1,180 and 1,633 direct jobs during the planning and construction phase” – which they say would be reduced to 80 or 81 jobs for the duration of the project’s alleged 25-year life span.” I have yet to see any offshore or onshore wind projects with an actual 25-year lifespan.
Other promises include the following:
In terms of resilience, Vineyard Wind will offer two key benefits for the Cape.
First, it will provide up to 800 MW of electricity, or enough to power more than 400,000 homes, directly to Cape Cod.
Second, Vineyard Wind’s proposal earmarks millions of dollars for direct investment into local microgrid storage and resiliency measures. Vineyard Wind’s “Resiliency and Affordability Fund” would help low-income ratepayers and provide battery storage for Cape and Islands’ communities. The program calls for a minimum $1 million investment each year for 15 years into distributed battery energy storage hosted by local communities where it is needed most. The initiative would provide credits directly onto the electric bills of low-income ratepayers’ on the Cape and Islands while also funding energy storage and solar projects that provide back-up power and energy-cost savings directly to public buildings like schools, hospitals and municipal buildings.
The construction of Vineyard Wind 1 began in November 2021 and was expected go into service in 2023 according to Iberdrola which has has a 50 % stake in Vineyard Wind through Avangrid Renewables.
The reality is that Avangrid and CIP announced on the 18th of October 2023 the successful installation of the first of 62 proposed GE Haliade-X wind turbine generators (WTG) for Vineyard Wind 1.
The final blade is installed on the first GE Haliade-X Turbine for the Vineyard Wind 1 Project. Source at Vineyard Wind
Given that Vineyard Wind 1 was expected go into service in 2023 and they still have 61 GE Haliade-X turbines to construct, they are a quite a bit behind schedule. This is positive in terms of protecting the whales, dolphins, birds, other marine life and the environment.
Please share Robert’s original post and consider subscribing to his Substack if you don’t already:
Please also see the following related posts regarding the great harm caused by incredibly expensive offshore wind installations which are subsidised by we tax and electricity bill payers in the UK:
All those QQE/ZIRP/NIRP UNICORNS are coming home to roost!
But the bigger problem is that since the "states" are mere curtains between the SRF & Billionaires (Corporations) and the herds of modern moron slaves we're seeing (only those that pay attention!) the usual behavior:
"Reuters reports the German government, Siemens AG, and other parties will provide billions of euros in project-related guarantees to support Siemens AG's struggling wind turbine division. This financial assistance comes just weeks after the company warned about mounting losses amid a meltdown across wind and solar industries. "
The herds of modern moron slaves will pay TWICE: via direct payment for the even costly energy they consume/waste and via the DEBT/INTERESTS the "state" issues for bailout these GREEN UNICORNS!
Pasting...
All those QQE/ZIRP/NIRP UNICORNS are coming home to roost!
But the bigger problem is that since the "states" are mere curtains between the SRF & Billionaires (Corporations) and the herds of modern moron slaves we're seeing (only those that pay attention!) the usual behavior:
"Reuters reports the German government, Siemens AG, and other parties will provide billions of euros in project-related guarantees to support Siemens AG's struggling wind turbine division. This financial assistance comes just weeks after the company warned about mounting losses amid a meltdown across wind and solar industries. "
The herds of modern moron slaves will pay TWICE: via direct payment for the even costly energy they consume/waste and via the DEBT/INTERESTS the "state" issues for bailout these GREEN UNICORNS!
https://postimg.cc/w3XwmG0v