Southwest Virginia appears well positioned to manufacture secondary components to support future offshore wind energy development in Virginia and other states, according to a new study.
The Xodus Group presented its research Wednesday, commissioned by InvestSWVA to support Project Veer, which showed the area offered multiple advantages for companies seeking to become involved in offshore wind energy projects.
Project Veer is an economic development effort designed to explore entry points for the region’s manufacturers into the offshore wind supply chain. It is funded by the GO Virginia Region One Council, Virginia Tobacco Region Revitalization Commission and Coalfield Strategies.
“The majority of major components are going to be imported for now,” Delia Warren of Xodus told participants in a Zoom call Wednesday. “However, to make sure the industries are successful and to maximize economic contribution within the U.S., we’re going to have to make sure that supply chain is localized so as much manufacturing as possible can be done in the U.S.”
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About $100 billion is forecast to be spent in capital expenditures nationwide by 2030, she said.
Currently Virginia has a target of generating 5.2 gigawatts of off-shore power by 2034. The combined target of Virginia, Maryland and North Carolina is 14.8 gigawatts, which represents nearly half of the total U.S. target of 30 gigawatts by 2030.
Presently Dominion Energy is constructing a 12 megawatt pilot project 27 miles off the Virginia coast. The company is working to develop a 2,600 megawatt – or 2.6 gigawatts – commercial offshore project.
The only U.S. wind turbine blade plant is planned for Portsmouth, Virginia, and is expected to employ 300 workers. Warren said it is likely most of the major components like turbine blades and towers will be made at or near the coast, due to size, but there is ample opportunity for support manufacturing.
This region is well positioned to manufacture high precision components, mechanical equipment, heating and cooling systems and secondary steel components including work platforms, ladders, railing and other items, she said.
“For secondary components, the region is actually ideally suited to support the manufacturing here. And you could also see there is a strong component of support available in project management,” Warren said.
The region also boasts comparatively low electricity rates and lower labor rates for trades in high demand for offshore wind, compared to some other states engaged in offshore wind development.
The study considered 13 Southwest Virginia counties and three cities as possible sites with the likelihood such manufacturing could also attract workers from Northeast Tennessee, western North Carolina, southern West Virginia and east Kentucky.
“We’re aware of the talent, the skill, the workforce, the ingenuity of our manufacturers and we’re very confident they can adapt to whatever new skills or talents might be required,” Mike Quillen, chairman of the GO Virginia Region One Council, said.
To support the effort, on Wednesday, the presidents of four area community colleges signed a memorandum of understanding to collaborate on training and development in the offshore wind energy manufacturing supply chain. This agreement fulfills one of the recommendations by the Xodus study.
Under the agreement, Mountain Empire Community College, Southwest Virginia Community College, Virginia Highlands Community College and Wytheville Community College will work together to promote, develop and expand the preparation of workers to enter the employ of regional supply chain manufacturers in the offshore wind energy generation sector, according to a written statement.
“We are looking to connect even more deeply with the employers of the region,” Adam Hutchison, president of Virginia Highlands said in the statement. “A key group is the closely-held manufacturers who have vast experience in other supply chains. Our goal is to work with them to prepare employees for a pivot into wind energy, which we think is well within their reach.”
Dean Sprinkle, president of Wytheville Community College called wind energy offers “an exciting and compelling path for people who may be ‘on the fence’ about a manufacturing career. Training workers and inspiring them to live and work in our region are elements of our mission in community colleges, and this is an enticing opportunity.”
Will Payne, managing partner of Coalfield Strategies and project lead for InvestSWVA, said, “The agreement we announce today is foundational to our success not just in the wind energy industry but to our ability to rally around opportunity together. The presidents of our community colleges are setting a great example.”
Other recommendations from the study include:
- Identify a major tier company to act as an anchor and an exemplar of the region, helping pave the way to relationships with global original equipment manufacturers.
- Form a partnership with the Hampton Roads Alliance, a Virginia entity and one of the nation’s most prominent offshore wind business and investment attractors.
- Designate a regional entity for positioning Virginia’s Southwest and for acting as a single point of entry for the offshore wind opportunity.
- Coordinate an approach for retaining the next generation of workers, including building awareness of the career potential in offshore wind.
Twitter: @DMcGeeBHC