Onshore wind power is cost competitive with conventional sources of electricity, but offshore wind power is more expensive, in part due to the added costs of offshore installation. Estimating the installation cost of future projects in the U.S. is an important component of capital cost and provides guidance on expected decommissioning expenditures. The purpose of this paper is to develop a model of the installation costs of offshore wind projects on the U.S. Outer Continental Shelf. Offshore wind farms are characterized in terms of four primary variables - nameplate capacity, turbine capacity, distance to port and distance to shore - which are employed in empirical models of installation. A bottom-up approach is used based on current technologies and expected market conditions for the period 2012-2017 to estimate stage-specific installation costs. The installation costs at three planned U.S. wind farms (Cape Wind, Bluewater Delaware, and Coastal Point Galveston) are estimated and range from $130,000 to $370,000 per MW. Sensitivity analyses are performed to identify the variables most responsible for uncertainty and risk. Cost is relatively insensitive to distance to port, but unit costs decline significantly with larger turbine capacity, and increase with the time required for installation. The limitations of the analysis are described. © 2012.
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