OFFSHORE WIND: A BOON TO CLIMATE GOALS AND ECONOMIC GROWTH

This briefing by Energy Innovation examines the role of offshore wind in achieving zero-emissions climate goals, focusing on cost reductions, technological advancements like floating turbines, and policy recommendations for the United States to scale its capacity.

• Offshore wind costs are declining significantly globally and in the U.S. European prices are expected to drop from approximately $200/MWh (2017-2019) to $75/MWh by 2024-2025. In the U.S., power purchase agreement prices are projected to fall from $224/MWh in 2020 to $58/MWh by 2025, with some long-term projections suggesting costs as low as $20-30/MWh by 2050.
• The transition from fixed subsidies, such as feed-in tariffs, to competitive procurement via reverse auctions has been a primary driver of cost reductions. For instance, Germany's shift to an auction-based system in 2016 resulted in contracts for differences between $0-44€/MWh.
• Technological improvements, specifically larger turbines, have reduced the levelized cost of energy (LCOE) and increased capacity factors. Average turbine size grew from 3 MW in 2010 to 5.5 MW in 2018, while annual capacity factors rose from 38 to 43 percent during that period.
• Floating turbines are essential for expanding capacity because 80 percent of global offshore potential and 58 percent of feasible U.S. resources are in waters deeper than 60 meters, where fixed-bottom turbines are not viable. Commercial-scale floating projects are expected to come online by 2025, with LCOE projected to drop to $70/MWh by 2030.
• Offshore wind provides high grid value due to capacity factors that are higher than solar PV and onshore wind. In the eastern U.S., expected capacity factors are 40-45 percent. Additionally, it complements solar production and can improve fuel security; a model of a 1,600 MW farm off Massachusetts suggested natural gas consumption would have been reduced by 20 percent during a 2018 weather event.
• Global capacity is scaling rapidly, with 23 GW installed in 2018. Under a "Sustainable Development Scenario," global capacity could reach 560 GW by 2040. The United Kingdom is targeting 42 GW by 2030, while U.S. forecasts range from 11-16 GW by 2030 to as much as 86 GW by 2050.
• To maximize potential, the document recommends that the U.S. establish higher procurement targets, use long-term Power Purchase Agreements (PPAs) or Offshore Renewable Energy Credits (ORECs), convert federal investment tax credits to direct payments, and develop a coordinated interstate transmission backbone.

APA

MYERS, A. (2020). OFFSHORE WIND: A BOON TO CLIMATE GOALS AND ECONOMIC GROWTH. Energy Innovation. https://energyinnovation.org/wp-content/uploads/Offshore-Wind-A-Boon-To-Economic-Growth_August_2020.pdf

Chicago

MYERS, AMANDA. OFFSHORE WIND: A BOON TO CLIMATE GOALS AND ECONOMIC GROWTH. Energy Innovation, 2020. https://energyinnovation.org/wp-content/uploads/Offshore-Wind-A-Boon-To-Economic-Growth_August_2020.pdf.

Wikipedia

{{cite report |last1=MYERS |first1=AMANDA |title=OFFSHORE WIND: A BOON TO CLIMATE GOALS AND ECONOMIC GROWTH |publisher=Energy Innovation |date=August 2020 |url=https://energyinnovation.org/wp-content/uploads/Offshore-Wind-A-Boon-To-Economic-Growth_August_2020.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{myers2020offshore, author = {MYERS, AMANDA}, title = {{OFFSHORE WIND: A BOON TO CLIMATE GOALS AND ECONOMIC GROWTH}}, institution = {Energy Innovation}, year = {2020}, month = aug, url = {https://energyinnovation.org/wp-content/uploads/Offshore-Wind-A-Boon-To-Economic-Growth_August_2020.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }