Page 8: of Marine News Magazine (June 2023)

7 9

By the

Numbers

Shipbuilding Contributes to

Higher Costs in US Offshore Wind

By Eric Haun

Higher shipbuilding costs are contributing to greater But the price to build these vessels in the U.S.—where overall project costs in the U.S. offshore wind industry, labor costs are only expected to increase—is considerably according to maritime and offshore consultancy Intelatus higher than it is for those being built in Asia and Europe.

Global Partners. According to Intelatus, the price for a newly built Jones

The United States will rely on a large ? eet of foreign and Act-compliant SOV comes with a 40% to 140% premium domestic vessels as it builds up toward the Biden Adminis- compare to SOVs being built for Europe.

tration’s target of 30 gigawatts (GW) of offshore wind ca- “[This] coincides with U.S. offshore wind projects such pacity by 2030 and 110 GW by 2050. This ? eet will con- as South Fork and Vineyard Wind looking at project CA- sist of both existing and newbuild tonnage, including wind PEX of around $4,500 to $5,500 per kilowatt (kW), some turbine installation vessels (WTIV), subsea rock installa- 30% to 50% higher than those of European projects,” In- tion vessels, service operation vessels (SOV), crew transfer telatus said.

vessels (CTV) and tug and barge spreads, among others. The ? rm said heightened vessel pricing in the U.S. “will

While vessels such as WTIVs can be foreign ? agged and have a signi? cant impact” when considering the quantity fed by domestic feedering solutions, others such as SOVs, of required vessels as part of the bigger picture.

CTVs and tugs will need to be built in the U.S. to comply “To date, developer construction and operations plans with the Jones Act, which requires vessels transporting car- and announcements indicate a market potential of more go between two U.S. points to be American-built, -owned, than 10 SOVs charted for long-term operations and main- -registered and -crewed. tenance support in the United States. Subject to cluster-

SOVs with applications currently pending for ? nancing under the U.S. Maritime Administration’s (MARAD) Title XI ? nancing program. Intended to help facilitate more offshore wind vessel construction, Title XI provides credit loans at longer terms and lower interest rates than traditional private loans.

Source: Intelatus Global Partners interpretation of MARAD data 8 | MN June 2023

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