German zero-subsidy bidder enters US offshore wind

German energy company EnBW has taken its first steps into the US market with a joint venture to install up to 1 GW. At first glance, however, there is a big problem with this move.

Photo: EnBW

German energy company EnBW wants into the US offshore wind market. The company has established a joint venture with US energy company Trident Winds regarding the development of the 650-1,000 MW project Morro Bay of the coast of California. This project will use floating offshore turbines due to the deep seabed off the the US's Pacific coast, EnBW informs in a press release.

"EnBW will have a direct presence in this promising market to capture opportunities and to further build up EnBW’s offshore project portfolio," says EnBW Head of Generation Portfolio Development Dirk Güsewell.

The company was established and is owned by a series of smaller German energy utilities and has historically been primarily active within the German domestic market. Aside from being a co-owner of the operational projects Baltic 1 and 2 as well as Hohe See, which is presently under construction, EnBW gained notoriety last year by being one of the two companies that placed a zero-subsidy bid in Germany's first offshore wind tender for the project He Dreiht.

Most recently, EnBW has strayed much further away from its domestic market. In the spring, the company purchased a share in three projects in Taiwan with a total capacity at around 2 GW. That was, however, a limited success, as a mere single project at 378 MW ended up being sent to the Taiwan's first tender in April.

It seems the project off the coast of California faces something of a challenge. Even though Trident Winds submitted in 2016 an unsolicited request for a commercial lease to US authorities (BOEM), the application is far from approved at present.

After one and a half years of preliminary investigations and hearings, an unexpected gavel struck. The US Navy using the site for exercises, and it was thus ruled that offshore wind farms could not be installed in an area of around 23 million hectares. That effectively precludes all offshore wind from Los Angeles to Napa Valley, north of San Fransisco – and thereby the Morrow Bay project.

"Information provided by BOEM to the Department of Defense indicates that the unsolicited offshore wind proposal from Trident is for an area within Department of the Navy ‘wind exclusion’ areas off the coast of Central California,” US Navy spokesperson Lt. Ben Anderson said in January, according to California media San Luis Obispo Tribune.

A political majority in California's state government is in favor of floating offshore wind off the coast. The state has since 2015 had the declared goal of sourcing at least 50 percent of its energy supply from renewables by 2030. California Governor Jerry Brown sees floating offshore wind as a suitable contributor to that goal.

"While energy resources from offshore wind have not yet played a significant role for California's energy system, these do offer important opportunities for the future," wrote Brown in the spring of 2016 to then Secretary of the Interior Sally Jewell, where Brown requested that BOEM form a task force for establishing offshore wind in California.

Until now, those efforts have produced a single project. In April, the Portuguese developer EDPR in cooperation with Principle Power and Aker Solutions chose to develop a pilot project at 150 MW. That project is just off the coast from Humboldt in Northern California, where the US Navy has not vetoed wind projects – but nor is the local demand anywhere near as large as it is in areas near Los Angeles or San José-

English Edit: Daniel Frank Christensen

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