Would Humboldt offshore wind development reduce costs for ratepayers?

The Schatz Energy Research Center at Cal Poly Humboldt analyzed (1) the cost of offshore wind transmission and found that it could result in substantial savings to ratepayers. As more offshore wind transmission infrastructure is built to accommodate more offshore wind turbines, cost savings increase (Table 14, pg. 80) (1). Schatz Energy Research Center also “found that new transmission infrastructure built to accommodate [offshore wind] development, whether it be onshore or offshore, can also serve other transmission system needs by providing additional routes for power flow. This can lead to lower cost systemwide power flow solutions, potentially resulting in substantial savings to ratepayers” (pg. 7) (1). In essence, the transmission improvements necessary for offshore wind to succeed should make Humboldt Bay’s power more reliable and plentiful, lowering cost.

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According to the California Energy Commission, offshore wind would save ratepayers at least $1 billion (2) in installed clean power capacity. Offshore wind is price-competitive with other forms of energy; the National Resource Energy Laboratory estimates the Levelized Cost of Energy (LCOE) (3) (the average cost of energy over the lifetime of a source of energy) to be in the range of $47–$100 per megawatt hour (MWh) (4) with that price expected to fall as more offshore wind is deployed. The U.S. Department of Energy estimates that the LCOE of offshore wind will fall to $53/MWh (5) by 2035 as the industry matures. This price range places it on par with both other renewables—less expensive than rooftop solar but more expensive than large solar and fossil fuels, and more expensive than natural gas but less expensive than coal. Importantly, when moving towards 100% renewable power, wind helps reduce the need for battery storage, by helping with grid balancing. However, now and in the coming years, it will be important for our communities, Tribal Nations, and local governments to work with Federal and State governments to develop policy solutions that ensure energy savings for our local communities.