The Cost of Floating Offshore Wind Energy in California Between 2019 and 2032 [report]

Philipp Beiter, Patrick Duffy, Matthew Shields, Aubryn Cooperman, Walter Musial, Donna Heimiller, Michael Optis
2020 unpublished
Executive Summary California's energy planning is centered around meeting the emissions reduction and renewable energy requirements of Senate Bill 350 1 by 2030. However, state power system planning is expected to eventually address California's requirement to achieve 100% of total retail electricity sales from renewable energy and zero-carbon resources by 2045, as mandated by Senate Bill 100. 2 To comply with these directives, California needs to investigate the further development of energy
more » ... lopment of energy efficiency, storage, and a diverse range of renewable energy, zero-carbon emission, and transmission resources, including offshore wind. Wind resources off the coast of California have the potential to generate a significant portion of the state's electric energy as it moves toward a zero-carbon economy and can help diversify its energy mix. Floating offshore wind technology, which is suitable for the deep waters along the California coast, is currently in a precommercial phase, with approximately 84 megawatts (MW) installed worldwide at the end of 2019. Globally there are over 7,000 MW in planning and permitting phases of development, with the first commercial-scale projects expected to be operational in 2024 (Musial et al. 2020b ). This study provides site-specific cost and performance data for floating offshore wind to inform California's long-term energy planning. The identification of new resources to meet California's policy goals at least cost is part of the Integrated Resource Planning (IRP) process, which is coordinated by the California Public Utilities Commission (CPUC). In 2019-2020 IRP modeling, offshore wind was included for the first time as a candidate resource in some sensitivity cases (CPUC 2019a). The data and information presented in this report can be used to update offshore wind inputs in future IRP cycles. The authors conducted a geospatial cost analysis over portions of the offshore wind resource area of California. The analyzed spatial domain includes sites with a mean wind speed of at least 7 meters per second and water depths between 40 meters (m) and 1,300 m. Costs and energy production vary across this analysis domain. We calculated these parameters on a grid layout with over 750 sites, with each site representing a 1,000-MW commercial offshore wind power plant. Levelized cost of energy (LCOE) was calculated at each site over the analysis domain. The resulting variation in LCOE across the analysis domain is illustrated through heat maps in this report. Five study areas were selected within the analysis domain where more detailed cost analysis was conducted and cost parameters, 3 such as annual energy production, capital cost expenditures (CapEx), operational cost expenditures (OpEx), and net capacity factors are reported. These five study areas include ( Figure ES-1) : vii This report is available at no cost from the National Renewable Energy Laboratory at The first three study areas are Bureau of Ocean Energy Management (BOEM) Call Areas, 4 and the latter two are additional study areas identified by Collier et al. (2019) . These five study areas are geographically dispersed along the central and northern coast on the Outer Continental Shelf off California where commercial-scale offshore wind projects are under consideration. We selected the study areas for the purpose of estimating costs and performance only. This study is not a stakeholder engagement or a marine spatial planning effort to create wind energy areas under BOEM's leasing process, and the study areas have not been vetted by ocean user communities as part of this analysis. Environmental resources or related laws are not considered in this analysis. We also acknowledge that the degree of stakeholder engagement can influence these costs. In this assessment, the associated development costs are fixed. Cost modeling is based on an assessment of current offshore wind technology and technology projections developed at the National Renewable Energy Laboratory (NREL). We assume that the accompanying port and grid infrastructure would be ready at the time of commercial deployment of the modeled projects. We estimate LCOE between 2019 and 2032 at commercial project scale. 5 The year 2019 was chosen as the baseline for this analysis so that inferences can be made from current data and performance characteristics of floating offshore wind systems. Key modeling assumptions include turbine upsizing from 8 MW (2019) to 15 MW (2032), and the use of a semisubmersible floating substructure. This substructure type is currently the most common among all the planned and deployed projects in the floating wind industry (Musial et al. 2020b ). Modeling of installation and operations costs assume that each site would be served by the closest port among a set of five ports identified as being suitable in principle for assembly of floating offshore wind systems (Porter and Phillips 2016). Humboldt Bay is modeled as the construction and operations port for Humboldt, Del Norte, and Cape Mendocino, with Port Hueneme serving Morro Bay and Diablo Canyon. Electrical system costs include an export cable that follows the shortest straight-line distance from the study area to shore and a uniform assumption for the onshore spur line length of 5 kilometers. Any other interconnection costs (e.g., for a land-based substation or bulk transmission system upgrades) are not part of this study, which is a limitation of this analysis. These additional interconnection costs might need to be supplemented to properly model offshore wind in capacity expansion models, such as the IRP capacity expansion model, RESOLVE.
doi:10.2172/1710181 fatcat:3hb7wmz4yndpleacstqgzqewga