Estimating the spatial economic and environmental impact of planned offshore wind energy in the USA using environmentally extended multiregional input-output analysis

There is a substantial projected increase in energy generation from offshore wind farms in the U.S. over the next three decades due to the rise in legislative commitments and funding from federal and state governments. Similar to other renewable energy technologies, the construction phase of offshore wind energy plants has potential environmental impacts and spillover effects to other regions, that need to be evaluated. Hence, developing offshore wind as a reliable domestic energy source requires a multiregional impact assessment of the economic and environmental spillover effects of constructing offshore wind farms in major lakefronts and coastal regions. Despite the lack of commercially operating offshore wind farms in the U.S., seven states have announced cumulative capacity commitments of over 28 GW by 2035. In this study, the spatial economic impacts of planned projects are estimated by combining NREL’s Offshore Renewables Balance-of-system Installation Tool (ORBIT) for offshore wind energy with a multiregional input–output (MRIO) model of the United States built with the Virtual Industrial Ecology Laboratory (IE Lab). The ORBIT model provides the required capital investment for the installation of projects of interest which is then combined with the MRIO model to evaluate spatial economic impact. Additionally, the environmental impact occurring in different regions of the U.S. due to spillover effects of the construction of new wind farms was also evaluated. This was done using a newly developed multiregional GHG emissions dataset for the US IE Lab to estimate the supply chain emissions of constructing and installing offshore wind projects. The 5 projects considered in this research require a combined capital investment of $16.3B and induce a total direct and indirect economic impact of $27.6B from spillover effects within the US. The emissions results indicate that the states involved in energy generation are highly impacted, emphasizing the fact that this can be improved by further decarbonizing the electricity grid. Based on the carbon pay-back period analysis, it takes these projects less than a year to offset all the emissions that were caused during the construction phase. The multiregional framework was used to identify which states experienced the most considerable spillover effects regarding emissions generation and economic activity required to support offshore wind projects.