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    • Renewables: Wondering about wind

    America's first offshore wind farm is the test bed for a new industry

    GWYNETH WILSON first spent summer on Block Island 58 years ago. She became a year-round resident five years ago because she loves island life, except for her high electricity bills. The island, which is about a dozen miles (20km) off the coast of Rhode Island, is not connected to the mainland's grid and, therefore, energy costs are among the highest in the country. The 1,000 or so year-round residents and 15,000 summer visitors rely on expensive, noisy, diesel-fuelled generators for power. Millions of litres of diesel are brought by lorry via ferry to the island every year. According to some islanders, brownouts (periods of low power or none at all) are common. But Ms Wilson is hopeful that all this is about to change; because Block Island is soon to be home to North America's first offshore wind farm.

    On July 26th the first "steel in the water" for the foundation of the small offshore wind farm was installed three miles off the coast. The five turbines, each with six-megawatt capacity, will be working by autumn 2016. Deepwater Wind, the company behind the project (which is privately financed at a current cost of $250m), expects the farm to cut energy bills for the island by 40%. The farm will produce more energy than the island needs, enough for 17,000 homes, so surplus energy will be used on the mainland.

    Another offshore wind project with 130 turbines near Cape Cod, Massachusetts, has stalled because of lawsuits and regulatory troubles. But in Rhode Island, so far, this has been avoided. The firm had to get permits from nine separate federal and state agencies. It also received federal tax credits for investment and production, which were needed to get bank loans. The project has support from environmentalists, fishermen and a local Indian tribe.

    Block Island is the pilot programme for the nascent American offshore wind industry. If successful, Deepwater will develop a farm with 200 turbines, between Martha's Vineyard and Block Island. The Bureau of Ocean Energy Management, which oversees renewable projects in federal waters, has issued nine commercial offshore wind leases to companies all along the eastern seaboard. If these areas are built to capacity, some 3,000 offshore turbines could generate enough energy to light up the equivalent of New Jersey. More offshore wind projects are in the works in New Jersey, near Atlantic City, as well as in North and South Carolina and New York.

    Block Island joins a growing wind industry in America (see chart). Wind is expensive. Depending on the region, it is between 15% and 200% dearer than fossil fuel, according to the Institute for Energy Research, a right-leaning group. Yet more than 100 projects are under construction in 24 states. Most are to be found in Republican places such as Texas, Oklahoma, Kansas and North Dakota. Last year, wind generated 4.4% of the country's electricity (solar power generates less than 1%), but a recent Department of Energy report said that wind alone could supply 20% of the country's electricity by 2030.

    The federal production tax credit is the main incentive, but 29 states have some sort of mandate. Most dictate that between 10% and 25% of electricity must come from renewable energy. California's mandates are among the highest: 33% by 2020. Utility firms are on track to meet that goal. State lawmakers are probably going to raise California's mandate to 50% by the end of the year. Other states are considering rolling back their standards. North Carolina wants to freeze its mandate. On May 28th Sam Brownback, Kansas's Republican governor, signed a law rescinding the state's renewable-energy mandates and replacing them with voluntary goals.

    At present 39 states have some sort of land wind project. Wind and other renewable, such as solar panels, have had much support from the Obama administration, beginning with stimulus funding in 2009 from the $800 billion American Recovery and Reinvestment Act. It was designed to kick-start the economy by investing in "shovel-ready" projects. Green energy may have received as much as $90 billion.

    Plenty of this went on boondoggles. Solyndra, a maker of solar panels which received $535m in federal money and loan guarantees, filed for bankruptcy in 2011. Abound Solar, which received $400m, also filed for bankruptcy. Although there were some famous failures, the green stimulus worked better for wind-related projects. The country's capacity to generate power from wind increased 60% in two years. The stimulus boosted manufacturing, too. Before it, wind turbines were mostly made from imported parts. Now about 60% of each turbine is made in America.

    Congressional support for renewables is strong on both sides of the aisle, as long as climate change is not part of the conversation. Lamar Alexander, a Republican senator from Tennessee, describes wind turbines as the "energy equivalent of going to war in sailboats when nuclear ships are available". But on July 21st, the Senate Finance Committee voted 23-3 to extend the renewable-energy production tax credit.

    Grid locked

    Increasing the share of electricity generated by renewables requires not only further subsidy, but putting in place backup generation capacity, which at the moment means gas-fired power plants. Improvements to the ageing power grid's transmission infrastructure are also needed.

    America has three major power grids, the Eastern Interconnection, Western Interconnection and the Electric Reliability Council of Texas (or ERCOT). Supply and demand have to be kept in balance on each one to avoid blackouts and brownouts, and there are only a few connectors between them to help with this. Renewables work best across large grids where, with luck, somewhere the wind is always blowing or the sun shining.

    Tiny Rhode Island, nicknamed the Ocean State, is hoping the Block Island wind farm will turn it into a renewable energy behemoth. It may only be 48 miles long, but it has a 400-mile shoreline. And a lot of wind.

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    This article was from The Economist and was legally licensed through the NewsCred publisher network.