The Sea-Monster-Sized Ship Disrupting Biden’s Wind-Energy Dreams
The costly, delayed construction of the Charybdis highlights a shortage of crucial ships
By David Uberti and Joe Wallace
In a shipyard near the southern tip of Texas, more than 1,000 workers are rushing to finish a massive vessel that embodies the promise and peril of America’s offshore wind-energy dreams.
Named after a mythical sea monster, the Charybdis will be the first vessel allowed to pick up turbine parts from U.S. ports, haul them into the ocean and construct skyscraper-sized windmills.
Backers herald the project as part of a burgeoning boom in green manufacturing.
But those hopes face mounting threats.
The Charybdis’s construction is running behind schedule and over budget.
Developers that chartered the ship for projects off the East Coast have scrambled for a limited number of backups.
And the pipeline for new vessels is running dry because shipbuilders are looking at similar projects with caution.
Such supply-chain snags, coupled with inflation and interest-rate hikes, have busted project schedules, hammered developers’ expected returns and pushed up what Americans will ultimately pay for offshore wind power.
Investors and developers fear that the U.S. market is in trouble before it really gets started.
The green-energy transition ready for take off in the U.S. is facing a serious obstacle: the permitting process. WSJ takes you inside the country’s soon-to-be largest wind farm to understand the regulatory gauntlet delaying clean energy for millions. Photo illustration: Getty Images/Amber BragdonDanish wind giant Ørsted is at the center of the difficulties.
It chartered Charybdis for two wind farms off Long Island, N.Y., a big risk given that new ships are often late out of the yard.
The delay forced it to shell out for a backup for one project and consider alternative options for the other.
Ørsted also scuttled two projects off New Jersey last month in part because it couldn’t get the right ship at the right time.
As Washington and East Coast states try to nurse the industry back to health, some energy executives warn that ship availability is among the most acute chokepoints.
“They want to build so many offshore wind farms but they do not have the vessels to do so,” said Sven Boedewig, managing partner of the maritime advisory Waterworks Offshore Concepts.
The agreement approved this week at the United Nations climate conference called for global renewable-energy capacity to triple this decade.
President Biden has put wind power near the heart of his renewable-energy ambitions, aiming to power more than 10 million homes from turbines by 2030.
The White House projected that corresponding manufacturing investments would include four to six U.S.-built turbine installation vessels like the 472-foot-long Charybdis.
Wind farms rely on small fleets of vessels to lay underwater cables, service turbines or transport construction workers to and from job sites.
The two largest types of ships—also the industry’s most scarce—are unlike anything American shipyards have built before.
Many American shipyards have faced a shortage of skilled workers, such as welders, who are now finishing tasks such as joining parts of the Charybdis’s hull.
About 1,100 workers are currently working on the Charybdis, which Dominion says is 79% complete.First, foundation-laying vessels use cranes to lower monopiles that can weigh more than 1,500 metric tons, equivalent to the mass of 21 fully loaded Boeing 737-700s, into the water.
They then pound the pieces into the seabed with a huge hammer.
That is when ships such as the Charybdis come in for work reaching as much as 600 feet above the water: Placing a tower on the foundation, situating a power generator called a nacelle on top of that, and attaching blades that can be longer than football fields.
The turbine-installation vessels needed at this stage drop four or more stilts onto the seafloor to push above the ocean’s swells.
Workers toil during windows when the sea and wind are sufficiently calm.
There are just 34 such turbine-installation vessels in operation outside China, and 12 more being built, said Arnstein Eknes, director of special ships at ship registrar DNV.
Nineteen foundation-installation vessels operate on energy projects outside of China, according to maritime-intelligence firm Spinergie, including just 10 dedicated to offshore wind.
The shortage means shipowners can charge up to $350,000 a day, encouraging developers to sign long-term contracts to secure the vessels they need, said Frederik Andersen, head of renewables at shipbroker Clarksons.
Ships get moved between projects like pieces on a chess board.
Any hiccups could disrupt intricately choreographed schedules for amassing components at particular ports.
A dearth of ships was a key factor in Ørsted’s cancellations in New Jersey, where a spokesman said a delayed installation vessel risked years of holdups and added costs for the company’s Ocean Wind 1 project.
Ørsted struggled lining up foundation-installation vessels, including a newly built ship that suffered construction delays in China, according to people familiar with the matter.
“A really fundamental part of any supply chain in the early stages of a wind-farm development is how we’re going to make sure we have access to the right vessels, the vessels we need, at the time we need them,” said Oliver Cass, who is directing construction of what will be the world’s biggest wind farm off the U.K. coast for utility SSE.
In Europe and elsewhere, turbine-installation vessels can shuttle to and from ports to pick up parts for such projects.
Construction takes longer in the U.S. because of the Jones Act, a roughly century-old law aimed at protecting the domestic maritime industry for commercial shipping and in the event of war.
Without U.S.-flagged turbine-installation vessels like the Charybdis, Ørsted and its partners must use a more complicated array of ships for their South Fork Wind project, where newly built turbines began generating power in recent weeks. PHOTO: JULIA NIKHINSON/ASSOCIATED PRESSThe statute means U.S.-made and U.S.-operated barges must carry turbine components from the port to the wind-farm sites.
Foreign installation vessels use their cranes to pick up the equipment and transfer it on board, a risky task because the barges don’t have legs to stabilize them.
If additional loads don’t arrive on time, or bad weather delays handovers, turbine-installation vessels and the dozens of crew members who live on board may sit idle.
When ship schedules get snarled, “that cascading effect is a killer,” said Marc Reimer, a renewable-energy partner at consultant ERM and former director of development for Ørsted’s canceled Ocean Wind 1 project.
In 2020, Dominion Energy D 3.82%increase; green up pointing triangle saw the looming slate of American wind farms and anticipated vessel shortage as a business opportunity.
The utility joined with a shipbuilder on the Charybdis, named for the monster that threatened to swallow the Greek hero Odysseus, and turned to Bank of America to finance what was billed as a project totaling $500 million plus financing costs.
Dominion also chartered the ship to Ørsted and New England utility Eversource for work on two projects near Long Island before the Charybdis would return to Virginia for Dominion’s own wind farm.
Little has gone according to plan since then.
The pandemic and inflation whipsawed labor markets, slowing construction in the Brownsville, Texas, shipyard where former workers say low pay and high turnover have long been the norm.
Dominion now expects the vessel to be complete by late 2024 or early 2025, a year behind schedule, running $625 million including financing.
That is as much as double what a similar ship might cost abroad, analysts say.
Mark Mitchell, Dominion’s senior vice president of project construction, said the project is about 79% complete and labor issues have stabilized.
“We’re getting to the point where I’ll say that heavy work is starting to roll off in the next few months,” Mitchell said, pointing to tasks like welding together parts of the hull.
The Charybdis carries a price tag currently estimated at $625 million, including financing costs, nearly double what a similar project might run abroad.
The living quarters aboard the Charybdis, which is designed to accommodate up to 119 people.
The Charybdis’s timeline won’t interfere with Dominion’s Virginia wind farm, a contract that begins August 2025 and that the company told regulators would total an estimated $240 million.
But the setback forced Ørsted and Eversource to line up a replacement called Scylla—Charybdis’s mythical partner—for its Revolution Wind project off Long Island and consider alternatives for another project known as Sunrise Wind, an Ørsted spokesman said.
Mads Nipper, chief executive of Ørsted, said last month that the company would try to reclaim money from its lease of Charybdis from Dominion.
A second new vessel that Ørsted was due to charter in the U.S. fell through altogether after the shipping company nixed plans to build it last year, people familiar with the matter said.
An Ørsted spokesman declined to comment on potential supplier contracts.
The uncertainty around Charybdis has rippled onshore to New London, Conn., where the companies and the state government invested about $300 million in port improvements, including dredging and a shore-to-ship power hookup designed for turbine-installation vessels.
Workers at the pier are now loading one turbine at a time onto a barge shuttling to and from Ørsted’s ongoing South Fork project, which has begun generating power.
Ulysses Hammond, interim executive director of the Connecticut Port Authority, hopes the Charybdis, designed to carry four turbines for each trip, will be ready for at least part of Sunrise Wind and that it may return to New London after Dominion’s charter ends in early 2027.
“This is going to be a game-changer,” Hammond said.
Dominion has held talks with developers for future charters but has yet to strike any deals.
“The exact numbers on what the business case is [for offshore wind] probably moved around a little bit,” Mitchell said of inflation and supply-chain issues.
“I still think there’s definitely a need for a vessel like this.”
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