The Associated Press May 3, 2010, 2:02PM ET

Study outlines Virginia offshore energy prospects

The development of a turbine manufacturing industry along Virginia's coast is key to creating jobs and reducing the costs of offshore wind energy, according to the most detailed analysis yet of the state's offshore wind prospects.

The report by the Virginia Coastal Energy Research Consortium concludes that the development of an offshore supply industry in Hampton Roads would generate thousands of jobs and reduce the estimated kilowatt hour cost of energy generated by wind turbines off the coast.

"The greatest upside opportunity for reducing the cost of offshore wind energy in Virginia is to attract major elements of a Mid-Atlantic offshore wind supply chain to the state," the report, Virginia Offshore Wind Studies, states.

Using existing coastal facilities, the manufacture of huge components needed to capture winds off the Virginia coast would create thousands of jobs, the study found.

"The shipbuilding and port facilities in Hampton Roads are well positioned to manufacture, stage and install foundations, towers and turbines anywhere on the Mid-Atlantic continental shelf," wrote George Hagerman, who led the research.

"Attracting investment in offshore wind turbine manufacturing to our region would create thousands of new, career-length jobs and reduce offshore wind energy costs by 1.5 cents per kilowatt hour," said Hagerman, who is with Virginia Tech's Advanced Research Institute.

Other key findings of the study:

-- Researchers identified 25 leasing sectors that could generate 3,200 megawatts of offshore wind generating capacity without interfering with shipping lanes, Navy training or space launches from NASA's Wallops Island facility on the Eastern Shore. The Navy and NASA have expressed concerns about offshore energy developments, and NASA has stated serious reservations about ocean structures within its flight path.

-- Turbine manufacturing in Virginia would decrease the capital costs of wind projects by 15 percent and generate an investment of $403 million in the local economy.

-- Within two decades, 9,700 to 11,600 jobs could be created with the development of 3,200 megawatts of offshore wind.

-- Research on the environmental impacts to shore and sea birds is scant and will require additional studies. A separate report will address that issue in June.

At least two energy companies have formally expressed interest in developing wind farms 12 miles off of Virginia Beach.

Proponents of developing offshore wind resources received the most significant boost in years last week with federal approval of the nation's first offshore wind in the waters off Massachusetts' Cape Cod. The developers want to generate power by 2012.

The $2 billion project still faces opposition in the courts, which could cool investors necessary to bankroll it.

In Virginia, Gov. Bob McDonnell has pushed for offshore energy development, including wind power, and a coalition of industry groups and seacoast mayors are lobbying for offshore wind.

"Virginia has a really unique asset when it comes to offshore winds," said Maureen Matsen, the governor's energy adviser. "We have a relatively shallow continental shelf but with very strong winds. That's a very unusual combination."


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