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Modeling the decommissioning cost of offshore wind development on the U.S. Outer Continental Shelf

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  • Kaiser, Mark J.
  • Snyder, Brian

Abstract

The U.S. government requires renewable energy facilities installed in federal waters provide financial security to help ensure decommissioning obligations are carried out in the event the operator is unable to meet its obligations or goes bankrupt. The size of the bond is determined by the estimated decommissioning cost and is required prior to the approval of construction activities. The purpose of this paper is to develop decommissioning cost estimates for proposed U.S. offshore wind farms. Removal and site clearance cost are estimated across each stage of activity using empirical and hypothetical relations under current technology and market conditions without inflationary adjustment. Preliminary development plans characterize and define the system and serve as model input. A bottom-up approach based on operational stages is developed across removal, transport, processing and disposal activities. Disposal cost is calculated on a per ton basis and is estimated separately for each wind farm component. The model is parameterized with data from four proposed U.S. offshore wind farms and decommissioning costs are found to range from 115,000 to 135,000Â $/MW, approximately 3-4% of estimated capital costs.

Suggested Citation

  • Kaiser, Mark J. & Snyder, Brian, 2012. "Modeling the decommissioning cost of offshore wind development on the U.S. Outer Continental Shelf," Marine Policy, Elsevier, vol. 36(1), pages 153-164, January.
    • Handle: RePEc:eee:marpol:v:36:y:2012:i:1:p:153-164
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    Cited by:

    1. Monalisa Godeiro & Mario González & Dylan Jones & Negar Akbari & Gabriela Nascimento & David Melo & Rafael Vasconcelos & Andressa Santiso & Luana Nogueira & Mariana Almeida & José Toledo, 2024. "Green Port Industry to Support the Offshore Wind Sector: A Proposal Framework," Energies, MDPI, vol. 17(23), pages 1-26, December.
    2. Judge, Frances & McAuliffe, Fiona Devoy & Sperstad, Iver Bakken & Chester, Rachel & Flannery, Brian & Lynch, Katie & Murphy, Jimmy, 2019. "A lifecycle financial analysis model for offshore wind farms," Renewable and Sustainable Energy Reviews, Elsevier, vol. 103(C), pages 370-383.
    3. Rogeau, Antoine & Vieubled, Julien & de Coatpont, Matthieu & Affonso Nobrega, Pedro & Erbs, Guillaume & Girard, Robin, 2023. "Techno-economic evaluation and resource assessment of hydrogen production through offshore wind farms: A European perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 187(C).
    4. Amélie Têtu & Julia Fernandez Chozas, 2021. "A Proposed Guidance for the Economic Assessment of Wave Energy Converters at Early Development Stages," Energies, MDPI, vol. 14(15), pages 1-14, August.
    5. Schwanitz, Valeria Jana & Wierling, August, 2016. "Offshore wind investments – Realism about cost developments is necessary," Energy, Elsevier, vol. 106(C), pages 170-181.
    6. Anne P. M. Velenturf, 2021. "A Framework and Baseline for the Integration of a Sustainable Circular Economy in Offshore Wind," Energies, MDPI, vol. 14(17), pages 1-41, September.
    7. Hou, Peng & Enevoldsen, Peter & Hu, Weihao & Chen, Cong & Chen, Zhe, 2017. "Offshore wind farm repowering optimization," Applied Energy, Elsevier, vol. 208(C), pages 834-844.

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