The global market for offshore wind projects is experiencing a resurgence in viability, driven by improved pricing strategies from governments and companies, according to Energias de Portugal (EDP) CEO Miguel Stillwell D'Andrade.
In an interview at an energy event in Oxford, D'Andrade highlighted the positive shift, stating, “We are seeing a major reset in prices for PPAs (power purchase agreements) and CfDs (government backed contracts) which are making projects viable.”
Countries around the world are turning to offshore wind farms as a crucial component of their climate targets, despite the high upfront costs. Over the longer term, these projects are expected to provide cheaper energy compared to fossil fuel plants.
EDP, through its joint venture with ENGIE called Ocean Winds, is actively involved in the development of several offshore projects globally. D'Andrade expressed confidence in the strength of the offshore market, emphasizing that projects in the United States remain attractive, even with the potential for a less climate-focused President following elections later this year.
Regarding the upcoming U.S. election, D'Andrade mentioned, “The consensus seems to be the (IRA) Inflation Reduction Act has bipartisan support and a lot of the funding is going to Republican states.” This statement comes amid concerns that a change in leadership could impact the trajectory of clean technology support packages, such as the $370 billion IRA set out by President Joe Biden in 2022.
Despite political uncertainties, the offshore wind market is showing resilience, with a growing number of governments and companies offering prices that make projects economically viable, signaling a positive outlook for the sector.
