The European utilities are already active in the US renewable energy sector, and aim to capitalise on the country's growing momentum behind offshore wind
US offshore wind is tipped for rapid growth over the coming decade (Credit: Tom Buysse/Shutterstock)
German utility RWE and the UK’s National Grid have set their sights on jointly developing offshore wind projects in the US, and plan to bid in upcoming auctions for the New York Bight leasing area.
Through a partnership agreement, the pair will target developments along the country’s north-east coastline, seeking to maximise their “complementary capabilities and expertise” in low-carbon electricity generation.
President Biden recently set a target to develop 30 gigawatts (GW) offshore wind capacity by 2030, opening up a host of new opportunities for energy firms to establish a presence in a sector that has yet to make inroads in the US, despite the country’s sizeable onshore industry.
Last week, the first commercial-scale US offshore wind project – Vineyard Wind I off the coast of Massachusetts – received federal approval, with first power expected to be delivered by 2023.
RWE and National Grid eye new opportunities in emerging US offshore wind market
Sven Utermöhlen, RWE Renewables’ chief operating officer for global offshore wind, said: “While we are an established presence in the US with our onshore wind, solar and storage activities, this partnership will support RWE’s plans to realise a sizeable position in the offshore wind space.
“Our partnership with National Grid represents an exciting milestone to further grow our renewable energy business in the US.”
RWE has an existing portfolio of around 20 offshore wind projects globally, including significant developments in the UK and Germany.
National Grid, while primarily focused on its UK grid operation business, also owns and operates gas and electricity distribution networks in the north-eastern US.
Through its non-regulated ventures division, the group has previously invested in the US renewables sector, notably acquiring onshore wind and solar specialist Geronimo Energy in 2019 for $100m.
“We’re very pleased to partner with RWE as we take our first steps towards developing offshore wind projects in the north-east US,” said Cordi O’Hara, incoming president of National Grid Ventures.
“This partnership further solidifies National Grid’s role in advancing a clean, fair and affordable energy future and will also complement our growing onshore renewables business, which includes a strong pipeline of solar, wind and battery storage projects across the country.”
The US is expected to become a busy market for offshore wind development over the next decade, particularly along its east coast.
Earlier this year, the government designated an 800,000-acre “New Wind Energy Area” along the New York Bight – which stretches between Long Island and New Jersey – for new leasing opportunities, the first of which could take place later this year.
Federal support is being made available to jumpstart developments towards the 30GW national target by 2030, including $3bn in loans from the US Department of Energy and expedited review processes through the Bureau of Ocean Energy Management.
European developers including Orsted, Iberdrola, Equinor and BP have already established a pipeline of new offshore wind projects in the country.