Investors remain cool to floating wind

Investors are so far shying from taking the plunge into floating wind.

Why it matters: The future of offshore wind on America's West Coast hinges on cutting-edge platforms that float atop the sea — and the cash needed to build them.

Catch up fast: The waters off California are far deeper than those off the East Coast. That requires newer, expensive floating turbine designs.

The latest: Global venture and private equity investors put $72.5 million into floating wind and solar startups last year, per PitchBook data.

• That's a fraction of the capital raised in 2021 and 2020.

Reality check: This remains a nascent space with relatively few deals — a couple dozen each of the past few years.

What's happening: Developers of conventional offshore wind turbines, which are planted in shallower seafloors, are already dealing with major quality control problems and cost challenges.

• Those issues have soured some investors on offshore wind companies.

Plus: The market chill of the past two years made investors even more cautious around capital-intensive startups.

What we're watching: The U.S. Department of Energy last year held the country's first auction for floating offshore wind sites, off California.

• Earlier this year the DOE announced steps to fuel further private investment, particularly through R&D.

Be smart: That support in such a quiet sector may spell startup opportunity — if founders can win over investors.

Of note: The levelized cost of energy for floating offshore wind is about $207 per MWh — nearly three times the $75 per MWh for fixed offshore turbines, per the DOE.