U.S. BABY STEPS TOWARD OCEAN WIND SUPPLY CHAIN

US takes cue from Europe to strengthen offshore wind supply chain; The likelihood of U.S.-based offshore manufacturing capacity will depend on turbine suppliers perceiving stable, long-term policy support and subsequent demand for offshore wind in the U.S. market.

Ritesh Gupta, April 15, 2013 (Wind Energy Update)

“…As offshore turbine designs continue to specialise and diverge from land-based designs, new facilities are likely to locate close to one another and near key ports, similar to the European model…The likelihood of U.S.-based offshore manufacturing capacity will depend on turbine suppliers perceiving stable, long-term policy support and subsequent demand for offshore wind in the U.S. market…In addition, they must have access to (or train) a sufficiently skilled workforce and appropriate logistical and installation capabilities…The opportunity…is highest in foundations/ substructures, towers, blade materials, and power converters and transformers…

“…[Three key factors are]…1) The expected timing of sufficient demand to support domestic manufacturing…2) the probability of shortfall in global offshore supply through 2015; and 3) The ease of transferability of land-based supply to serving the offshore wind market…Market barriers faced by new suppliers in the offshore wind industry fall into two primary categories…[inadequate production planning and inadequate production facilities]…”

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“Consistent policy will reduce the market fluctuation and supply chain disruptions…Strong and consistent demand will also make it more attractive for banks to lend to suppliers who want to invest in new equipment to build the larger components required by the offshore market. With a strong backlog of orders, suppliers will find it attractive to build port-side manufacturing facilities to reduce transportation costs and improve delivery times…

“There are multiple approaches for driving demand that have been used successfully in Europe. These approaches deal with lowering the cost of offshore wind; lowering or removing technical and infrastructure-related challenges; and removing regulatory challenges involved with siting and permitting of projects…”

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