Why Does The US Suck at Wind?

The U.S. wind industry kinda blows. Okay, that might be a bit harsh, but the past few years haven’t been great for turbines in the States. 2023 was particularly nasty. The weather got us off to a bad start with less resources to work with in the first place. By year’s end, new wind turbines had contributed far fewer additions to the grid than usual. And to make matters worse, offshore wind saw basically no progress whatsoever, clocking in at zero installations. That’s all against a backdrop of multiple high-profile accidents and escalating public animosity.

At the end of the day, wind energy is nowhere near the level of deployment we’ve seen with solar. It’s almost as if the sun were a distant star. But how do these problems fit into a larger context? Are they temporary or to be expected? And where are the rays of hope?

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About a year ago, we covered the literal large-scale issues leading to blowback in the global wind industry — and also highlighted some promising new approaches on the horizon. That was more of a response to a series of troubling headlines and a general sense of unease. Y’know, qualitative stuff.

But now, the data’s out: on the world stage, the U.S. is underperforming. Let me hit you with a few key statistics:

1. “Wind power’s contribution to total U.S. electric-power capacity additions in 2023 fell to 12%, the lowest level since 2013.”
2. “…2023 was a slow year in terms of new wind deployment, the lowest since 2014.”
3. “The newly installed projects in 2023 were all land-based; no offshore projects were commissioned in 2023.”

That’s according to a 2024 report hot off the presses from the U.S. Department of Energy’s Lawrence Berkeley National Laboratory.¹ So, what the heck is going on here? (And what exactly are we doing in response?) We’ll get to the story behind these facts later on, but before we do, let’s acknowledge a critical influence that makes last year look as bad as it does.

I want to focus on the U.S. alone and talk about the weather. From an analytical point of view, 2023’s wind patterns were not doing us any favors. As you might expect, it’s kinda hard to convert mechanical energy into electricity if you don’t have what you need to start the process…which is exactly what happened. Low wind speeds led to a significant dip in generation. It was kind of an all crank and no hand situation. And the effects of this are worse than just turbines left on standby. But hold that thought for now.

Of course, this phenomenon didn’t spread evenly throughout the States … if only it were that simple. What’s most important here, though, is that the Midwest was hit the hardest. Out of the top five states with the highest installed capacity, three are located squarely where wind speeds dropped. That’s despite the fact that the Midwest is also home to some of the states’ tallest towers…because it typically experiences some of the fastest winds in the country once you go past 100 meters (or 328 feet).²¹ In other words, the Midwest is home to some of the largest swaths of turbines…and also suffered the most striking year-to-year changes.

I know nuance isn’t exactly popular on the internet, but there is one more thing to keep in mind. See, wind generation did go down by about 2.1% between 2022 and 2023, but…2022 is a standout in terms of how windy it was. You wouldn’t want to compare your less-than-average to someone else’s personal best, and that’s why we need to be careful when interpreting these numbers. Still, it was notable enough to appear on climatologists’ radars.³²

You see the same thing with solar. From personal experience with the solar installed on my previous house, 2021 was an oddball year and I saw an 11.4% decrease from the year before. If you look at things in isolation it looks dire, but the following year was the best year we had. These variances are expected.

Okay, we’ve established how Mother Nature wasn’t too generous in 2023. But what caused the steep decline in wind energy installations?

Well, I’d make a joke about how there’s enough contributing factors to fill up a salad bar, but we’re past salads at this point. The mixture of problems plaguing the wind industry has officially made it to salmagundi levels of chaos. Which is appropriate, considering it’s mostly the U.S. offshore wind industry that’s trying to coast past a watery grave.⁴⁵

Where to even begin? Why don’t we keep talking green — money, that is. The overall economic inflation within the past few years has not spared wind turbines. From GlobalData figures, as of summer 2023, the cost of wind turbines had risen by approximately 38% in two years.⁶

The prices of crucial materials like steel and cables went up, and so did several minerals, like zinc, copper, and a bunch of rare earths. In fact, an analysis by Energy Monitor published in April 2023 found that “the average price of the seven most significant critical minerals for the wind industry has increased by 93% since January 2020.”⁶ Other forms of capital, like specialized installation vessels for offshore turbines, grew more expensive, too.⁷ These numbers represent the highest average price of equipment in about a decade.⁸

That might have been manageable another time. But wind developers weren’t in a position to borrow more money to cover their costs, either, because of the rise of interest rates. You can simplify the concept of an interest rate into “the cost of money,” or what you pay back on top of the amount you’re borrowing. Interest rates do fluctuate, but it’s usually in the order of percentage points.⁹ However…when inflation, a pandemic, and a war caused supply chains to break down and prices to jump, wind developers were left with interest rates that might as well have waved at airplane passengers as they shot far past projections. In turn, these rising costs caused an avalanche that buried projects.⁵¹⁰¹¹

This has been a recent trend in both the States and in Europe, but cancellations have caused particular heartache on the U.S. east coast. In June 2023, the U.S.-based company SouthCoast Wind started the process of canning its power purchase agreement (or PPA) between it and my home state of Massachusetts.¹² A PPA, by the way, is a long-term contract that sets the price of each MWh a renewable energy supplier produces for its buyer.¹³ Here’s the problem. What happens when your turbines are either unfinished or unmoving? Well, I can tell you what definitely doesn’t happen: profit.⁴

So, SouthCoast’s reasoning for the company cutting its losses on its existing contracts was based on the three economic hurdles I just went over: inflation, high interest rates, and a struggling supply chain. It’s probably not surprising, then, that SouthCoast wasn’t the only renewables company to fold. Avangrid Renewables LLC, an arm of Spanish conglomerate Iberdrola, also moved to end its Massachussetts power purchase agreements that same month for the same reasons. And the financial consequences of pulling these plugs were not pretty. SouthCoast and Avangrid chose to pay termination fees of $60 million and $48 million, respectively, rather than burn money by upholding their PPAs.¹²¹⁴ Power contracts in Connecticut and New York faced similar setbacks.¹⁵

But it gets worse. In November 2023, Danish renewables company Ørsted completely canceled its development of the Ocean Wind I and II offshore wind projects located alongside the state of New Jersey. To be clear, it wasn’t just dropping a PPA. It gave up on the projects entirely. Because of the penalty that followed, the company was on the hook for a whopping total of — and you might want to brace yourself here — 28.4 billion Danish kroner, or 2.7 billion dollars.¹⁶ In other words, Ørsted found the Ocean Wind efforts so unprofitable, it was willing to scrap them completely and lose literal billions rather than move forward.

Fees weren’t the only thing that monumental, either. The reason why the stakes are so high with offshore wind farms specifically is because their titanic proportions translate into a lot of energy in a little amount of time. According to data from BloombergNEF, “In the US, each megawatt of installed capacity of offshore wind farms could produce as much as triple what a solar park would generate.”⁷ Combined, the canceled Ørsted projects would have added 2,400 MW (or 2.4 GW) of capacity to the U.S. grid.¹⁷ To put that into perspective, that’s the equivalent of over 4.5 million solar panels. And, of course, enough for a roundtrip warp back to the future.¹⁸ All in all, it would have supplied power for about 1 million people.¹⁵

That’s not even getting into the political opposition to wind turbines, which is both organized enough to shut down projects and currently intensifying.⁵⁴ Even though community disapproval typically isn’t the only reason for stops and holdups, it’s still pretty potent. Earlier this year, the Lawrence Berkeley National Lab published the results of a survey of 123 wind and solar industry professionals from 62 different companies. Together, this sample represented people who contributed to about half of the wind and solar projects developed between 2016 and 2023.

The survey established that within the last five years, approximately 30% of wind project siting applications were canceled.¹⁹ And in a question about the primary causes for cancellations and delays, more than half of the respondents identified multiple causes…but community opposition was in the top three.²⁰

Most developers are worried about it, too. 4 out of 5 respondents answered that they were at least moderately concerned that “community opposition will get in the way of decarbonization goals,” and the general consensus is that tensions will heighten in the coming years. The survey results also show that in the case of both wind and solar, NIMBYism is not only spreading, but becoming increasingly expensive to navigate.²⁰¹⁹

That’s not to say that fears and negative local opinions about wind farms are entirely unfounded, though. Any kind of industrialization involves risks and impacts, and renewable energy is no exception. As recently as this past summer, a major incident caused operations to grind to a halt at an offshore wind farm. Once again coming back to Massachusetts, Vineyard Wind 1 only began producing electricity in February, years past initial expectations. And it’s still under construction, so only five out of a planned total of 62 turbines were turning.³ By July, 10 turbines were up and running … and then a blade failed in the middle of testing. It ended up spilling foam and fiberglass into the ocean, prompting a federal shutdown of the farm and earning the rightful ire of people living, fishing, and beach going nearby. It wasn’t the only one, either. A blade from the same model of turbine had failed a few months earlier at the Dogger Bank A offshore wind farm in the UK.²¹⁴²²

In the grand scheme of things, this is a rare occurrence. Of the tens of thousands of turbines put out into the world in a single year, only a few ever malfunction. But it’s hard to overlook the proximity of these accidents to each other, and the timing is especially bad.²¹⁴ We could get into the root causes that have led to accidents like these lately, but that’s already explored in-depth in my video on the topic.

What’s important to know here, though, is that the U.S. offshore wind industry is still very new. It may be struggling to regain its footing after getting the wind knocked out of it…but we’re only just getting started. Vineyard Wind itself, for example, is one of the States’ first few offshore wind farms, and it’s not even finished yet.²³²¹ Meanwhile, those power purchase agreements I mentioned before have the chance to be re-negotiated. And we still have many more farms in various stages of completion to look forward to: New England Wind 1, Vineyard Wind 2, Revolution Wind, Sunrise Wind…the list goes on.¹⁵²⁴ On top of this, in December 2023 the state of New York just celebrated the milestone of the U.S.’ first offshore wind power being used at a commercial scale, thanks to South Fork Wind.¹¹²⁵ That farm is now officially open as of this past March.

It’s obvious that U.S. wind has had a bit of an off period. But a bad year is not necessarily a bad forever … or else we would have never survived middle school. And as offshore wind continues to mature in the region, there’s exciting new research and improvements cropping up all the time. We know that wind can work. Establishing a U.S. offshore wind industry just requires that we do the same.