U.S. Offshore Wind Development Policy Review

This paper distills data and insights from the National Renewable Energy Laboratory (NREL) Offshore Wind Market Report (2024 Edition)^[1] and the latest federal policy developments to examine the principal stages of offshore wind development in the United States. It is published in anticipation of the release of the 2025 NREL report, expected in August, with the hope that readers will be better prepared to gain insight from the upcoming report.

The global offshore wind industry has seen rapid advancements over the last decade. Europe and China combined have achieved over 75 GW of installed capacity, with sixty percent of this capacity installed in the last five years, and innovations like floating wind turbines are unlocking deeper waters for energy production.[2] However, growth in the United States has lagged, hindered by regulatory hurdles heightened by adversarial policies, infrastructure gaps, and high upfront costs. The U.S. currently has less than half a gigawatt of capacity operational. In contrast, onshore wind farms continue to dominate the domestic wind energy market, with an operating capacity of 150 GW, twice the size of the total offshore wind capacity in all stages of production as of 2023.^[3]

Offshore wind farms offer several significant advantages over the onshore alternative, like higher capacity factors thanks to high winds and availability of space for bigger turbines, while operating in closer proximity to major coastal population centers. Despite their many advantages, the aggressive retraction of federal support threatens to undermine progress at nearly every phase of development.

Though reliance on federal approval and support is untenable for the time being, financial risk tolerance, infrastructure development, and ecological responsibility remain areas of active negotiation and innovation for offshore wind developers. This paper investigates these challenges with the aim of evaluating the viability of offshore wind as a business venture under shifting regulatory conditions and whether it can still fulfill its potential as a scalable source of renewable power in the United States.