Plummeting costs and performance improvements of offshore wind have dramatically enhanced the prospects for near-term power sector decarbonization. The high resource quality of U.S. offshore wind, coupled with rapidly falling technology costs, makes it possible for offshore wind to provide 10-25% of total electricity generation in the U.S. power system in 2050 without substantially impacting wholesale electricity costs.
The 2035 Report 3.0 examines how offshore wind can help achieve 90% clean electricity by 2035 and 95% clean electricity in the U.S. by 2050. Three scenarios – Low, Medium, and High Ambition – detail the electricity system impacts of increased offshore wind growth. For offshore wind to play a substantial role in the nation’s electricity system, the report finds that the U.S. will need to deploy 250-750 gigawatts (GW) in the Atlantic Ocean, Pacific Ocean, Gulf of Mexico, and Great Lakes.
Around the globe, nations have begun to grasp the sea’s energy opportunity. The global pipeline of offshore wind projects that have been announced or are in pre-construction now stands at over 700 GW. The European Union endeavors to build nearly 400 GW of offshore wind by 2050, while China installed 20 GW in the last two years alone and will likely surpass 180 GW installed by 2035. While the Biden Administration has a target to deploy 30 GW of offshore wind by 2030 on a pathway to 110 GW by 2050, increasing offshore wind ambition beyond these current goals and policy action to build a domestic supply chain could accelerate the U.S. transition to net zero emissions.
The 2035 3.0 report shows that the U.S. has one of the world’s best offshore wind potentials, enough to power up to 25% of total domestic power needs with this abundant clean energy. Progress in the next decade is critical to build out the U.S. offshore wind supply chain. With the right mix of policies that start today, we can make offshore wind a cornerstone of the transition to a zero-emission economy, creating jobs, improving grid reliability, and keeping electricity affordable.
The U.S. has some of the world’s highest offshore wind potential. When combined, the U.S. coastline, including the Great Lakes region, has nearly 4,000 GW of potential offshore wind capacity. More than 1,000 GW of this potential is highly productive, with capacity factors above 50%, suggesting offshore wind can provide affordable and reliable clean energy generation across the nation.
Our analysis suggests that achieving near-net zero emissions by 2050 through electrification of the economy will result in the annual demand for electricity to soar to 10,700 terawatt-hours (TWh), with daily peak demand passing 2,100 GW in the winter.
Today’s electric grid comprises more than 1,000 GW of installed capacity. Fossil fuels provide about 60% of total generation while clean energy resources including nuclear, hydro, biomass, geothermal, wind, and solar provide the rest. This analysis suggests offshore wind could provide 10-25% of total generation in a near-net zero emission economy. By 2050, the Baseline scenario deploys 3,400 GW of new land-based wind and solar resources, plus 1,500 GW of new battery storage and 1,300 GW of green hydrogen combustion turbines, but only 67 GW of offshore wind. In this scenario, deploying 3,400 GW of land-based renewables by 2050 would require 127 GW of new capacity to be installed each year, about triple the installations expected in 2023, and five times the current record from 2021.
In contrast, the Offshore Wind Policy scenarios require ambitious deployments of all clean energy resources to meet rising electricity demand. The Mid Ambition scenario deploys 500 GW of offshore wind by 2050, in addition to 600 GW of land-based wind, 2,000 GW of solar, and 1,200 GW of battery storage. In this scenario in 2050, offshore wind comprises 20% of total annual generation, while land-based wind and solar contribute approximately 20% and 45% of annual generation, respectively. The additional clean energy generation from offshore wind reduces the need for land-based wind and solar resources by 25% (reducing onshore deployment by 700 GW) and battery storage capacity by 15% (reducing battery deployment by 200 GW) compared to the Baseline scenario.
As offshore wind capacity ramps up across scenarios, land-based renewable capacity falls slightly. The Mid Ambition scenario requires land-based renewable installations to proceed at a reduced rate, closer to four times the 2021 deployment rate. In this scenario, offshore wind deployments increase from 8 GW per year in the 2020s, to 27 GW per year between 2035 and 2050.
Scaling a domestic offshore wind industry could create new jobs, revitalize local communities, spur domestic manufacturing, and stimulate the entire U.S. economy through increased economic activity. When isolating the impacts of just offshore wind development, the High Ambition offshore wind policy scenario could support approximately 390,000 jobs across the economy.
Approximately half of new offshore wind jobs (210,000 by 2050) are in the electricity sector and related to operations and maintenance of the system. In the near term, these jobs are concentrated in the Northeast, where a significant amount of new capacity comes online.
Overall impacts to national GDP are strongly linked to the pathway of investment over time. The High Ambition offshore wind scenario results in significantly higher investment in offshore wind technology, but more modest investments in battery storage and land-based solar and wind, because of the high performance of offshore wind. Depending on the domestic content of local supply chains, this scenario can modestly boost long-term GDP– approximately 0.1 to 0.2% – relative to Baseline which equates to approximately $40 billion (in 2021 prices) in additional U.S. annual economic activity by 2050.
The transition to a net zero economy will require doubling existing transmission infrastructure. amounting to at least $700 billion in new transmission investment in the High Ambition scenario. However, a clustered offshore wind transmission approach, which allows for greater aggregation of offshore wind production into fewer collection points, could reduce offshore transmission costs by 35% relative to a business-as-usual approach. Offshore wind provides an opportunity to reimagine the transmission planning process and avoid the bottlenecks that have plagued land-based renewable energy deployment.
The High Ambition scenario involves a total transmission investment of $719 billion, approximately 80% greater than that in the Baseline scenario, primarily due to the more extensive spurline development required to connect offshore wind generation facilities to the land-based grid. Spurlines account for 74% of transmission investments, or $532 billion, while investments in bulk transmission remain relatively in line with those of the Baseline scenario (24%, or $187 billion). However, if all offshore wind plants in the High Ambition scenario are connected to the onshore transmission system using the clustered interconnection approach, the offshore spurline costs are reduced by $135 billion.
Clustering multiple offshore wind plants together and connecting them to the onshore grid using a single high-voltage line can significantly reduce interconnection (spurline) costs, while increasing resource optimization, economies of scale, and energy output. It also has knock-on effects, explored in the policy report and an analysis by the Brattle Group, of improving developer certainty, facilitating greater competition, reducing environmental and community impacts, and potentially improving grid resilience.
A diverse portfolio of clean energy technologies, buoyed by a new influx of offshore wind, is critical to ensuring future grid dependability with the anticipated major increases in energy demand through 2050. Not only is offshore wind an abundant resource, its daily and annual generation patterns are particularly complementary to existing clean energy technologies like solar and onshore wind.
During normal periods of generation and demand, the portfolio of land-based wind, solar, and offshore wind, combined with battery storage, is sufficient to meet energy needs, providing 80%-90% of total electricity generation. During periods of high demand, particularly in peak winter months such as January, other resources ramp up to fill rising energy demand. Green hydrogen CTs contribute approximately 6-7% of total generation in 2050 in all Offshore Wind Policy scenarios, providing a reliable backup during periods of low renewable production or high electricity demand.
To highlight the dependability of a 95% clean electricity grid in 2050, showcase how generation patterns of renewable resources balance each other, and estimate firm capacity requirements, we identified the period during the seven weather years that experienced the largest shortfall between clean electricity generation (including battery generation) and electricity demand. The total system demand at this time of about 2,011 GW is met by a combination of offshore wind generation (316 GW, representing about 45% of installed capacity) and other clean resources, such as hydropower and nuclear (140 GW total), approximately 1,080 GW of green hydrogen CT’s, and 155 GW of battery storage discharge.
Across seven weather years, the green hydrogen capacity requirements proved to be highest in the winter months (December-February), when solar generation falls significantly, and demand picks up due to increased electrification across sectors. Green hydrogen CT generation above 500 GW is required for fewer than 100 hours per year across the seven-year simulation. Of the 1,080 GW of green hydrogen CT dispatched in 2050 in the High Ambition scenario, 500 GW have a capacity factor less than 1%, meaning that resources are used very infrequently.
Offshore wind can be integrated into the U.S. power system and provide 10-25% of total electricity generation in the U.S. power system in 2050 without substantially impacting wholesale electricity costs. Wholesale electricity costs are just .25% higher in the High Ambition scenario than Baseline in 2050, while costs in the Low and Medium Ambition scenarios are approximately 2% and 3% cheaper relative to Baseline, respectively.
In the interim years, costs in the Offshore Wind Policy scenarios are also very similar to Baseline costs. In 2040, the wholesale electricity costs in the Low and Medium Ambition scenarios are 0.4% and 2.6% more expensive than Baseline, respectively.