The Gulf of Mexico has for decades been a sea of hulking oil platforms. The Biden administration now wants to plant wind turbines there.
This week the US interior department called on companies to express interest in leasing in a 30m-acre area in waters off Louisiana and Texas, part of a push to build 30 gigawatts of carbon-free offshore wind power up and down the US coastline by 2030.
It would be a radically new look for the gulf, where offshore oil wells date to the 1930s and now account for 15 per cent of US oil production. As in the North Sea in Europe, new spending on wind could offset declining investment in oil megaprojects.
The federal Bureau of Ocean Energy Management contends that the oil and gas industry “will most likely lead the way”, noting that some oil majors — all of them based in Europe — have set goals of net-zero carbon emissions by 2050. TotalEnergies of France and Royal Dutch Shell are among those that have shown early interest in a potential bidding round for wind development rights.
John Bel Edwards, the Democratic governor of Louisiana, has said his state’s long experience in oil and gas gave it “a strategic advantage in developing offshore wind in the Gulf of Mexico”. The federal government envisages lease sales in the gulf by early 2023.
Yet gulf projects are likely to fall behind projects on the Atlantic and Pacific coasts in the wind development queue.
One reason is weaker wind speeds in the gulf and lower average electricity prices in Texas and Louisiana. A report from the National Renewable Energy Laboratory found that the “estimated cost of producing power from offshore wind at all GOM sites was above the required revenue opportunities”, unless costs continued to decline.