Updating Offshore Wind Performance

We decided to update our charts on the performance of U.S. offshore wind farms. Three wind farms are currently operating, and four are under construction. One of the operating wind farms, Coastal Virginia Offshore Wind, is a pilot program that comprises two experimental data-gathering wind turbines that will become part of the larger wind farm currently under construction.

The pause in wind farm permitting ordered by President Donald Trump in January is being challenged in court by a consortium of 17 state attorneys general. They want the ban lifted so their states can pursue more wind energy. The suit is in a preliminary stage, as is a suit against the pausing and then restarting of construction of the Empire Wind I project. At issue in both cases is the question of the Secretary of the Interior and his regulatory agency (Bureau of Offshore Energy Management) following the provisions of the Administrative Procedures Act in governing their actions. With two federal district courts hearing cases involving the same question, a difference of opinion may result in the issue being sent directly to the U.S. Supreme Court for resolution.

It is impossible to know the offshore wind’s legal pathway, but we expect the journey will take numerous twists and turns over the next few months. We will be writing about developments as they unfold, but today we are interested in the latest data showing how these operating wind farms are performing.

Rhode Island

First up is the oldest operating wind farm – Block Island Wind (BIW), located off the coast of Rhode Island. Although BIW entered the offshore wind race behind Cape Wind, it crossed the finish line first. Cape Wind was initially proposed in 2001. The 170 wind turbines would be positioned in Nantucket Sound, five miles south of Cape Cod. Cape Wind was victimized by vigorous opposition from wealthy summer residents on Cape Cod, Nantucket, and Martha’s Vineyard, who wielded significant political influence. The opposition successfully killed the project after nearly a decade of effort. However, Cape Wind suffered from the emergence of operational issues that could not be easily or cheaply resolved. Some of these offshore wind operational issues persist, but regulators have chosen to overlook them in the current approval process. Could people die from their actions?

BIW’s five-turbine, 30 megawatt (MW) wind farm was developed by Deepwater Wind, an organization founded in 2007 by the financial hedge fund D.E. Shaw Group. The wind farm was designed as a test for larger wind farms anticipated to be built off the coasts of New York and Massachusetts. BIW is considered a success, despite never producing the amount of wind power its developer predicted. This is a story of how the goal post for performance has been moved, and a supportive media reports what they are told and nothing else.

In 2022, BIW celebrated more than five years of operation with federal, state, and local dignitaries attending an event hosted by the wind farm’s current owner, Ørsted. It acquired BIW and three additional offshore leases at the end of 2018 for $510 million. Deepwater Wind invested $300 million to build BIW, but that cost does not include the power cable connecting Block Island to the Rhode Island mainland. The cable was not part of the Deepwater Wind sale. The cable allows Block Island Power Company, the purchaser of BIW’s output, to ship surplus power to the mainland, while also being able to import mainland power when BIW does not produce sufficient electricity. The cable allowed Block Island Power Company to shut down its diesel generators when BIW began operation.

The Providence Journal’s science/environmental reporter attended the event and wrote a glowing report about BIW’s success. When we questioned its performance, we were informed that the reporter relied on data from the Public Utility Commission (PUC). He was uninterested in the press releases from Deepwater Wind and GE, the turbine supplier, that the wind farm would produce “over 125,000 megawatt-hours (MWh) of electricity annually.” Multiple press releases quoting this number were issued when BIW sought to have its project approved by the PUC due to its high-priced electricity.

The PUC rejected the power purchase agreement as too expensive. That decision prompted an enraged Rhode Island legislature to write new standards for the PUC’s review of offshore wind projects. The historical cost-benefit analysis of power purchase agreements was banned. With the new standard in place, Deepwater Wind resubmitted its contract, and the PUC was forced to approve it, while noting in its decision that the approval ignored any cost-benefit analysis.

U.S. power plant operators, including those with solar and wind farms, are required to submit their monthly operating data to the Energy Information Administration, the statistical analysis and reporting agency within the Department of Energy. Their data is reported with a two-month lag. Therefore, we only have data for the three wind farms through April this year. The following chart shows BIW’s annual output for 2017-2024.

BIW has never achieved the output that Rhode Islanders were promised.

In the chart, we show the theoretical capacity factor (47.6%) for BIW based on the 125,000 MWh of annual output claims. No year has reached that threshold. The best performance was in 2020 when BIW reached 45.7%. However, Ørsted now says BIW’s theoretical capacity is 42%. They pointed to 2018-2020 as successful years, with 2017 being a start-up, but it nearly met the standard. The poor performance in 2021 was due to unscheduled major repairs for the turbines, especially the blades. We believe some of that repair work impacted 2022’s production. Ørsted’s problem is explaining why BIW’s performance was poor in 2023 and 2024.

Another way of looking at BIW’s performance is to examine the monthly output by year. The following chart illustrates the impact of the 2021 repair work. However, more importantly, it shows that in 2023 and 2024, the output was lower than in prior years during the winter months, when the wind blows stronger and steadier. It is during the winter months that Rhode Island Energy relies more on offshore wind to power the grid, thereby minimizing the need for expensive LNG and restarting coal and oil power plants to meet its generation needs.

BIW output is not off to a great start in 2025.

The first four months of 2025 show continued underperformance compared to virtually every prior year. April 2026 appears to be the first month that BIW output was closer to the historical high production for that month. It will be interesting to see if the May data shows a continuation of that better performance or a decline more in line with previous summer months.