Here’s why Burns & McDonnell remains confident in the industry despite recent hiccups.
A little more than seven years ago, Burns & McDonnell had no involvement in the offshore wind industry. Today, the engineering firm is involved in roughly 80% of U.S. projects across a range of activities — and it’s not slowing down anytime soon.
Heading up the company’s now well-established role in this new industry is Offshore Wind Director Tony Appleton, who recently spoke with Oceantic Network about the ups and downs of the industry over the past year.
While 2023 saw many successes for the U.S. offshore wind industry, cost overruns due to inflation and supply chain constraints led to several project cancellations. Despite some rough waters, states and many private companies remain confident in the industry’s future success.
Tony shared that Burns & McDonnell has run into its fair share of challenges amid industry shakeups. As a result, the company has looked even more closely at the work it takes on, the reasons behind it, and the risks attached to some of those challenges.
“As the offshore wind industry evolves in the U.S., we continue to carefully analyze the developing federal and state requirements. This critical observation doesn’t hinder our progress in pursuing project opportunities, but it does necessitate more comprehensive risk reviews. By examining the work we undertake, the underlying motives, and the associated risks, we are positioning ourselves to navigate the complexities of this developing industry with informed precision.”
Here’s what else he had to say about the state of offshore wind today.
Oceantic Network: In many ways, 2023 was a difficult year for the offshore wind industry — even though we had a lot of successes. But such hardships were not limited to the U.S. What other factors impacted the industry globally?
Appleton: Looking first at the global supply chains, several issues affected them. One is obviously the post-Covid inflation. You’ve then got various wars taking place, particularly in Ukraine, that have affected energy costs and inflation. So, there’s a couple of issues there, but not necessarily ones that we can work to solve.
Oceantic Network: What are your thoughts on the state of the global market for offshore wind and other renewable energy specifically?
Appleton: If you look at the global renewables industry, the desire for offshore wind is apparent. This has caused an almost incomprehensibly large demand on the supply chain. Countries can react in a couple of different ways, one of which is to build numerous new plants and numerous new facilities. That could be a short-term solution but may pose a long-term problem. As offshore wind reaches broader adaption, the demand will slow down making it difficult to occupy those factories long-term That is one reason it’s important that countries work to adopt a balanced approach to their supply chain development.
Oceantic Network: What issues did you see that were specific to the U.S. last year?
Appleton: There’s a uniqueness to the U.S. as every project is different. Every project is the first of its kind. Every single one has a different capacity, is done a different way and has different requirements. Given that the industry is still evolving in the US, issues are being raised in many areas. For example, if you want to permit an offshore wind project in Europe, maybe half a dozen permits are required compared to the US where permitting these types of projects can require more than a hundred permits. In addition to a strenuous permitting system, the U.S. also has competition between the states given that in many cases, the states aren’t working together.
Oceantic Network: What do you see being done to alleviate these concerns?
Appleton: We’re starting to see the beginnings of collaboration. You’re starting to see the states talking to each other and putting thought into how offshore wind adoption can be done together. This is an important consideration because if it is done collectively, there will be more consistency for individual projects and across the supply chain. That’s what three New England states are looking at with their procurement processes. They’re moving from local content to regional content. If they follow through on this plan, it can be a huge step forward, and can serve as an example for other parts of the U.S. This concept of clustering can be a huge asset to resolving some of the industry’s supply chain issues.
Oceantic Network: Does standardization play a role here?
Appleton: Yes, another thing that can be done is to start doing standardized projects. Rather than having a different capacity for each project, there should be an aim for certain consistencies. Another area with potential for standardization is the race for bigger turbines. The industry is not giving itself time to catch up. Turbine manufacturers do not have adequate time to test new models before bringing them to market. Recently, we have seen some of the turbine manufacturers slow the development of newer, larger turbines. I see that as quite positive because it gives the supply chain time to catch up. If the U.S. were to build numerous wind farms using 15 MW turbines, this standardized way of doing things could potentially drive down costs, similar to what we see happening with wind farm projects in Europe.
Oceantic Network: Could share some of your experiences with Burns & McDonnell over the past year in the U.S. in comparison to your operations elsewhere?
Appleton: I’ve seen a lot of growth in the U.S. Industry and feel there is a clearer understanding of what being part of the global offshore wind industry means rather than just a U.S.-centric industry. Offshore wind is very reliant on the global supply chain as it can’t all be managed domestically in any country (with maybe the exception being China). That’s something perhaps a little bit different from many other industries, certainly for us in our work. We’ve had to educate ourselves in what it means to rely on the global supply chain to help us be involved in the industry.
Oceantic Network: You said your appetite for offshore wind hasn’t changed. What would you say are the positive proof points you could point to that indicate the industry’s future success?
Appleton: The country is preparing for offshore wind, especially with the lofty goals set forth to be achieved. While some projects have slowed or been canceled, what we are seeing in the background are the many upgrades being made by utility companies in places beyond Long Island and Connecticut. The grid is seeing upgrades all over and much of that is due to the acknowledgment that offshore wind is not just a concept but a reality.
