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Illustration: Lazaro Gamio/Axios

HOUSTON — Power from offshore wind is finally poised for liftoff in the U.S.

Why it matters: The U.S. has long been a laggard, but that's poised to change thanks to a convergence of forces that analysts see bringing enough coastal wind online over the next decade to power millions of homes.

What's happening: A huge energy conference here in the nation's oil-and-gas capital offers a window into what's prompting giant energy companies to plan multibillion dollar investments. It's a story of...

  • Atlantic Coast states moving ahead with zero-emissions power procurement policies.
  • Oil-and-gas majors expanding their low-carbon power portfolios.
  • Technology evolution and falling costs.
  • The Trump administration supporting the development even as it abandons Obama-era climate programs.

What they're saying: "The missing piece for some time was actually an interest from the states up along the coast to acquire this power from this industry," says Christer af Geijerstam, who heads U.S. wind efforts for the oil-and-gas giant Equinor.

  • "That's where we have seen the significant shift the last 2–3 years being led by New York and Massachusetts," he tells Axios while at the big CERAWeek by IHS Markit conference.

ICYMI: In December, Equinor was among the winning bidders in a federal auction of development sites that are off the Massachusetts coast.

  • This adds to another site in federal waters off New York that it had acquired in 2016.
  • They paid $135 million for the Massachusetts site in the Interior Department auction that brought in a record-shattering $405 million.
  • I asked if Equinor would bid in federal lease auctions in the planning stages off New York and California. He said yes and offered no caveats.

The big picture: IHS Markit's current forecast sees 7 gigawatts of offshore wind coming online in the U.S. by 2030, up from almost nothing today. But that estimate could rise.

  • "We will be looking carefully at what the outcome of solicitations in Massachusetts and New Jersey and New York is going to be," IHS associate director Max Cohen says.
  • Bloomberg NEF already projects 11.4 gigawatts of capacity by 2030. They've upped their estimate thanks to a combination of specific solicitations and long-term targets by state governments in Virginia, New Jersey and elsewhere.

Where it stands: Equinor is among several deep-pocketed companies in the space planning projects. Here are some other players...

  • Danish wind giant Orsted bought the U.S. firm Deepwater Wind last year.
  • A joint venture between Shell and EDP also had a winning bid in the recent Massachusetts sale. "The U.S. has a magnificent wind resource right next to a large population and highly densely populated areas," Enrique Alvarez Uria of EDP Renewables said at a panel here yesterday. He estimated EDP's effort with Shell could be a $4 billion to $6 billion capital investment.
  • Vineyard Wind, which is co-owned by Copenhagen Infrastructure Partners and Iberdrola's Avangrid Renewables, snapped up a lease that adds to their plans for a separate project in the region.

What we're hearing: One real but hard to quantify factor is the role shareholder pressure plays in the moves by oil majors to diversify into renewables.

  • “The changing ESG [environmental, social and governance] landscape is really going to move capital,” Jonathon Kaufman, the co-head of the power and renewables group at Credit Suisse, said at a separate panel discussion yesterday.
  • Kaufman tells me that for oil majors, the growing moves into renewables require a balance between competing goals, particularly when fossil fuel projects deliver higher margins.
  • "There's this tension between putting money into something that's much lower returns, but also evolving their business mix," he adds.

The intrigue: Offshore wind has long been a big thing in Europe. But one irony of the U.S. delay in entering this sector is the upside of being a late mover — lower costs.

  • "The U.S. came late to the show, but they’re certainly sort of reaping the technology benefits from Europe," af Geijerstam said, noting the projects here start "really, really low on the cost trajectory."

Go deeper

Updated 50 mins ago - World

Mexican President López Obrador tests positive for coronavirus

Mexico's President Andrés Manuel López Obrador during a press conference at National Palace in Mexico City, Mexico, on Wednesday. Photo: Ismael Rosas/Eyepix Group/Barcroft Media via Getty Images

Mexican President Andrés Manuel López Obrador announced Sunday evening that he's tested positive for COVID-19.

Driving the news: López Obrador tweeted that he has mild symptoms and is receiving medical treatment. "As always, I am optimistic," he added. "We will all move forward."

Sarah Huckabee Sanders to run for governor of Arkansas

Sarah Huckabee Sanders at FOX News' studios in New York City in 2019. Photo: Steven Ferdman/Getty Images

Former White House press secretary Sarah Huckabee Sanders will announce Monday that she's running for governor of Arkansas.

The big picture: Sanders was touted as a contender after it was announced she was leaving the Trump administration in June 2019. Then-President Trump tweeted he hoped she would run for governor, adding "she would be fantastic." Sanders is "seen as leader in the polls" in the Republican state, notes the Washington Post's Josh Dawsey, who first reported the news.

Coronavirus has inflamed global inequality

Illustration: Aïda Amer/Axios

History will likely remember the pandemic as the "first time since records began that inequality rose in virtually every country on earth at the same time." That's the verdict from Oxfam's inequality report covering the year 2020 — a terrible year that hit the poorest, hardest across the planet.

Why it matters: The world's poorest were already in a race against time, facing down an existential risk in the form of global climate change. The coronavirus pandemic could set global poverty reduction back as much as a full decade, according to the World Bank.