FOR IMMEDIATE RELEASE May 19, 2011Reaching Offshore WindsLast October Robert Mitchell, CEO of Trans-Elect, moderated an Offshore Wind Power Summit just outside Washington, DC. Trans-Elect, along with partners Google, Good Energies, and others had recently announced the Atlantic Wind Connection (AWC). The AWC is a planned, $5 billion, 6000 MW, Direct Current, offshore transmission line connecting southern Virginia to northern New Jersey. The new transmission capability will provide relief for one of the most congested grid areas in the country, but it also puts some wind in the sails of the fledgling US offshore wind-power industry.

In his opening remarks, Mitchell suggested that summit attendees should use their imagination and think big. The same kind of encouragement has come from the DoE, with its recent National Vision and Call to Action seminars for creating an offshore wind industry in the US; specifically, at the September 28 seminar Chris Hart, DoE Offshore Wind Manager, called for innovation to dramatically reduce the cost of offshore wind.

The DoE has also recently published a number of helpful documents. In September the National Renewable Energy Laboratory (NREL), part of the DoE, published Large-Scale Offshore Wind Power in the United States, and in June NREL published Assessment of Offshore Wind Energy Resources for the United States. The latter provides detailed wind speed data on a state-by-state basis. more

The same report noted that the total US wind resource within 50 miles of the East Coast has over 4 TW of generating capacity, or about four times US electricity consumption. This is a small fraction of the total resource, as federal waters extend 200 miles from shore. The wind resource more than 50 miles offshore also has stronger and more consistent winds as the effects of the jet stream approach sea level, becoming trade winds. There is also less wildlife that far off-shore, as well as less recreational and commercial boating, Further, that far out, no one on shore can see or hear these proposed wind turbines. They would be over the horizon. The problem there is that much of the water is too deep for sea floor foundations.

Dr. Gary Buchanan of the New Jersey Department of Environmental Protection told the summit of offshore wind experts that curtailment orders could be issued to wind farm operators during bird migrations. He went on to note that turbines less than 5 miles offshore impact birds the most, while turbines tens of miles out to sea avoid migratory patterns. This illustrates one of the conundrums of the offshore wind industry: That is, current financeable offshore wind technology is mounted to the seafloor and needs to be sited in relatively shallow water, but shallow water often comes with many other stakeholders. Cape Wind is an example of where such stakeholders were able to both delay and increase the start-up cost for the wind farm. Jim Gordon and Cape Wind have been forging a trail for offshore wind farms with a perfect record of legal victories. In October 2010, US Secretary of the Interior Ken Salazar signed their lease at the AWEA Offshore Wind Conference in Atlantic City. Still, they have been at it for 9 years.

Although the United States leads the world in installed terrestrial wind turbine capacity, we currently have zero turbines operating offshore. more

England has almost one half of the 2.5 GW total worldwide installed offshore-wind generation, and has ambitious plans for even more offshore wind farms. Charlie Hodges, a Summit speaker from England and an Energy Analyst with Bloomburg New Energy Finance, noted that because England has a limited supply chain for offshore wind turbines, 90 P of every Pound that England spends on wind technology still goes to foreign contractors or turbine suppliers. Jim Lanard, President of the US Offshore Wind Development Coalition, was quick to point out that if we are going to gain and keep US legislative support for the industry, we will have to generate domestic jobs. This line of thinking led to a discussion of the Jones Act. This act would prevent foreign vessels from being used to set foundations and assemble turbines at sea but, because no one has yet installed an offshore wind turbine in the United States, we lack the purpose-designed ships necessary to do those jobs well. The primary question asks: Do you need to have a supply chain in place before you can start to build projects, or if projects are approved, will the supply chain materialize? Peter Mandelstam, President of NRG Bluewater, a wind-farm developer, is working to fill the pipeline with projects, and believes equipment will become available.

There were two presentations during the Summit, providing an alternative answer to this conundrum: One by Principal Power and the other by the University of Maine. Both of these talks focused on what the terrestrial turbine industry calls Floaters. Principal Power has a strong knowledge of floating structures from the oil drilling industry. Their model is to marry this with proven conventional wind turbine technology.

moreDr Habib Dagher of the University of Maine, a recipient of DOE funding to study floating wind turbines, challenged the conventional perspective that the farther offshore you go, the more expensive the generation of electricity becomes. He noted that by eliminating a seafloor foundation, the cost structure of supply-chain issues and the costs-to-assemble and service turbines at sea, are dramatically improved. As noted previously, the farther away from NIMBY Issues, the better the wind resource becomes, and the ability to tow a turbine back to the factory in a single day mitigates risk, potentially reducing both insurance and banking costs.

There is a rapidly-growing list of offshore turbine designs announced for launch. Hodges noted that in a market where there had recently been only a few suppliers, there are now 30 new product releases planned by 2015. The conventional wisdom says that larger offshore wind turbines continue to be more economical, but Hodges and our own DoE peg the price of offshore wind at 4 to 5 million dollars per megawatt, about twice what terrestrial turbines cost. Englands Energy Technology Institute, (ETI) is investing millions of Pounds in the development of floating offshore wind turbines with the express purpose of halving the cost of offshore wind. Their portfolio of floating projects includes vertical axis wind turbines which, although not as efficient, have historically been cheaper to build, more reliable, and have a low center-of-gravity, more-readily enabling flotation. Floating wind turbine technology is experiencing high levels of development funding in the European offshore wind industry as England, Portigal, Spain, Holland and Norway have funded programs or have turbines floating in the water already. Still the floating offshore wind industry is in its early phases, presenting the United States with a path to sidestep many barriers and the possibility to leapfrog Europe and Asia in building a domestic wind turbine manufacturing industry to reach our deep water wind resources.

###Caption for illustration: American Offshore Energys concept for floating wind turbines is based on modern sail boat racing technology.

Links:Offshore Wind Power Summithttp://image.exct.net/lib/ff2b12797165/d/1/Offshore%20MC%20onsite%20agenda.pdf

Atlantic Wind Connection (AWC) http://atlanticwindconnection.com/

Large-Scale Offshore Wind Power in the United Stateshttp://www.nrel.gov/docs/fy10osti/49229.pdf

Assessment of Offshore Wind Energy Resources for the United Stateshttp://www.nrel.gov/docs/fy10osti/45889.pdf

Englands Energy Technology Institute, (ETI) http://www.energytechnologies.co.ukAuthorDrew Devitt 484 767 2311

ddevittt@AmericanOffshoreEnergy.comContactMichael Wright Director of Marketing

American Offshore Energy4009-G Market StreetAston, PA 19014 USA610.364.3453 Direct

610.494.0911 Fax

mwright@AmericanOffshoreEnergy.comThursday, May 19, 2011 American Offshore Energy Reaching Offshore WindsPage 1