NRG Energy Inc. is nearing a key decision on a contract for wind turbines for its Mid-Atlantic Wind Park off the coast of Delaware, marking a milestone in one of the first major offshore generation projects in the U.S.
NRG Energy’s Bluewater Wind Delaware LLC unit plans to build turbines more than 13 miles off the coast of Delaware to generate 200 megawatts, enough electricity to power up to 52,800 homes.
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That’s big enough project to rank it among the largest offshore wind projects in the world currently in operation. NRG NRG +0.04% says it may expand the operation to 450 megawatts.
“We are in negotiations and we are narrowing the field” of turbine makers, NRG Bluewater Wind spokesman David Gaier said Thursday. “We ... have not yet settled on a model or manufacturer.”
NRG is leaning toward more recently-designed turbines capable of producing 5-6 megawatts each, he said. The bigger offshore turbines offer more economy of scale than the 3-megawatt versions proposed in the mid-2000s, when the Bluewater project began its approval process, Gaier said.
He declined to provide further details about the timing of any decision on turbines from the Princeton, N.J.-based company.
While NRG won’t discuss the size of the contract, the price tag for the operation may exceed $1 billion, based on cost estimates of other big offshore projects.
Bluewater Wind’s Mid-Atlantic Wind Park would become the second major offshore wind project in the U.S. to name a turbine supplier after Cape Wind selected Siemens AG SI +0.07% one year ago.
Judy Chang, an analyst for the Brattle Group who studies wind power, said NRG’s choice for a turbine maker for its Delaware project would mark a “significant” step for the offshore wind industry.
“Bluewater and Cape Wind are the ones that the likely to be the first offshore wind projects in the U.S.,” she said. “What’s more interesting...is who will be the one who will set up shop to build offshore turbines in the U.S. and what state will get that business?”
The NRG Energy contract for the Mid-Atlantic Wind Park would also mark a big win for one or a group of turbine makers, which have been facing competition and price cuts in their land-based businesses. See: U.S. headwinds challenging Vestas
Possible contenders for the Bluewater wind park include Gamesa SA ES:GAM +2.32% , Siemens AG, Vestas Wind Systems DE:VWS -0.07% and General Electric Co. GE -0.15% . Other
offshore wind turbine makers that may be in the running include Areva Multibrid, REpower Systems AG and Bard Holding GmbH.
Spokesmen for GE did not respond to emails from MarketWatch inquiring about the Bluewater Wind project in Delaware. A Vestas spokesman and a Gamesa SA spokesman said the companies could not comment on projects that are not announced. REpower Systems declined to comment. Emails by MarketWatch to Areva Multibrid and Bard were not answered.
“It’s Siemens’s policy to not comment on speculation,” said Monika Wood, a spokeswoman for the company.
Lining up a turbine maker for the Bluewater Wind project would help Delaware move toward its goal of generating 25% of its power from renewable and other technologies by 2025.
“It’s definitely a step in the right direction,” said analyst Matt DaPrato of IHS Emerging Energy Research North America Wind Advisory Service. “It’s progressing the project, but it doesn’t mean it’s a sure thing.”
