By Peter Nicholson
A Presentation to the Nova Scotia Offshore Wind R&D Forum; Halifax; September 24, 2025
Good afternoon, and thanks to our organizers, Net-Zero Atlantic, for the opportunity to outline why I believe, passionately but logically, in the nation-building power of Atlantic offshore wind energy. In the two years since publication of a paper for the Public Policy Forum in which I described in rather visionary terms how Atlantic Canada could become an energy superpower, the concept has been elaborated in a growing number of impressively detailed reports, conference proceedings, and R&D contributions by many in this room.
I believe we can all agree that Atlantic offshore wind development, at scale, is now a concept with traction. Nowhere has this become clearer than in the Wind West proposal described this morning by Premier Houston and proposed to the federal government as a nation-building project in support of Prime Minister Carney’s objective to make Canada an energy superpower.
What I aim to do in the next 30 minutes is to delve into this monumental opportunity and, from a high level, place it in both a national and global context. Almost everything I say will be familiar to this expert audience. What I hope will be helpful is the narrative arc; the thread that binds together a complex amalgam of factoids, implicit assumptions, potential opportunities and their associated challenges. The takeaway is the story itself. Put another way, this is what I would say if I were briefing the Prime Minister or a Premier, other than Premier Houston of course. He is already well-steeped!
The story from start to finish is essential to tell because the great majority of Canadians—and this includes too many in the energy industry itself—has little awareness of offshore wind energy. When people think of Canada as an energy superpower, they tend to think of oil and gas and maybe hydro and nuclear. This is understandable since fossil fuels, hydro, and nuclear comprise almost 95% of Canada’s total primary energy consumption. Only about 3% is wind-generated—all onshore.
To put the offshore wind opportunity in its proper context we have to start from three fundamentals that are well-known to this audience, but much less well understood outside. They’re the basis for everything that follows.
- History teaches that human progress depends on energy combined with innovation. Nations that are among the leaders in the efficient production and use of energy will inevitably also be among the leaders in living standards.
The future of energy is electricity, already becoming evident from the upward sloping lines on the chart. It’s because electricity is the most flexible form of energy. It can be instantly delivered. It can be cleanly generated. And it’s efficient. For example, electric motors can convert about 90% of input energy to useful work compared with barely a third for their internal combustion counterparts, thus conferring a fundamental advantage to EVs. Or consider that heat pumps under most circumstances deliver three to five units of heat energy per unit of electrical energy, far better than the direct burning of gas or oil.
The future of electricity generation will be dominated primarily by solar and wind complemented by the two other key non-emitters, hydro and nuclear. The chart shows that fossil fuel’s share of world electricity generation has been falling for more than a decade while the exponential growth of the renewable share is being driven entirely by wind and solar (although not broken out in the chart).[1] I believe it’s now inevitable that these two sources will contribute by far the largest share of the future growth of electricity, and therefore of energy growth in total. That’s mostly because of cost efficiency and security of supply.
– Solar and onshore wind generation is already cheaper than the alternatives in many parts of the world, certainly for new installations even while accounting for the cost of storage to cope with intermittency. The main point is that today’s cost is virtually guaranteed to continue falling relative to the major alternatives because wind and solar generation and storage will benefit from continuing technological innovation and from the “learning curve” effect of scale and growth.[2]
– As for security of supply: the daily solar “fuel” that drives wind turbines and solar panels is inexhaustible, it’s everywhere, and it’s forever free. So it’s not subject to the sort of geopolitical choke points and price swings that are a constant risk when depending on fossil energy.
– All this is not to mention that solar and wind generation is clean—no climate changing emissions, and no particulates to foul the air we breathe.[3]
The point to be emphasized is that the global energy transition to renewably-generated electricity is not occurring primarily out an imperative to curb GHG emissions, essential as that is. No: it’s happening for reasons that are dominant in the here and now—economics and security. Emissions reduction and a net-zero future come as a huge bonus.
Based on the three strategic fundamentals—energy as the principal driver of prosperity; electricity as the best form of energy for most purposes; and wind and solar becoming the best way to generate electricity—the world is in the early stages of an epochal energy transformation, the implementation of which will be the biggest investment project ever undertaken.
For evidence, look to China where electricity demand is now soaring with no sign of let-up (chart on the next page). Although electricity consumption in the US and Canada has flat-lined, that is about to change in response to the eventual electrification of more of everything we do. And while China has been vilified for the dominant role played by coal-fired generation, it’s now providing the vast majority of its net electricity growth from solar and wind.[4] And by pushing the cost of clean renewables down dramatically, China is spearheading the energy transformation throughout the developing world and demonstrating to the West where things are headed.
In the US, the Biden administration got the message and responded, albeit belatedly, with the Inflation Reduction Act incentives, including an objective to install 30 gigawatts of offshore wind power by 2030, mostly on the northeast coast. Unfortunately, the Trump administration didn’t get the memo and remains fixated on the rearview mirror thus creating new opportunity for those who are prepared to look ahead. What’s so ironic about President Trump’s position is its stark inconsistency with what’s been happening in deep red, oil-soaked Texas, where I spend about half the year. Nowhere in North America are there more savvy energy entrepreneurs, and nowhere in North America is there more installation and growth of wind and solar energy. So, go figure.
I have recited this background because it provides the fundamental context in which to think about Canada’s energy future, and specifically about where Atlantic offshore wind fits in. We are talking here about a multi-decade investment project that needs to be situated in a multi-decade view of where the global energy system is headed. Of course, there will be a transition period where fossil fuels continue to play a very significant role—longer in some places like Canada and the US than in others. But relative to the timeframes applicable to investment in the global energy transformation, the renewable electricity future is now.
So where does Canada stand? The crystal ball is inevitably hazy but many forecasting exercises foresee roughly a doubling of electricity demand over the next 25 to 35 years from about 620 terawatt hours currently.[5] This would be driven by population growth and electrification of road transport, space heating, certain industrial processes, and an explosive growth of data centres as life is digitized, whether by AI or otherwise. To cite one among many informed perspectives on future electricity demand and supply in Canada we might turn to modelling by the Canada Energy Regulator in its 2023 report on Canada’s Energy Future. Although the CER’s focus was on net-zero emissions by 2050, the projections are nevertheless relevant in the broader context of the global energy transformation I’ve just outlined.
This chart breaks down electrical generation by source over almost four decades from 2023 through 2050. Hydro is projected to grow by only a little more than 25% recognizing that most of the best sites are already exploited and new major projects may be constrained by environmental and other factors. The CER projected more than a 200% increase in nuclear reflecting the prospect of economically competitive small modular reactors and the need for reliable base load. Solar is anticipated to make only a small contribution. In my view, that’s likely a significant underestimate in view of the rock-bottom prices of Chinese panels and ongoing innovation in installation technique.[6]
Clearly, the CER projection leans heavily on wind generation, increasing seven-fold by 2050 to provide approximately 370 terawatt hours of electrical energy, or to about 30% of the doubled national total over the next three decades or so. Other projections will come up with different specific estimates but virtually all that I’ve seen include a very significant share of wind energy when account is taken of the constraints and costs faced by other sources.
To summarize: the world energy system is already in transition to a future that will be dominated by electricity, generated primarily by solar and wind, with a continuing role for hydro and nuclear. Canada will be no exception. So, to meet Prime Minister’s Carney’s objective to be an energy superpower, Canada will have to embrace this future, relying on our fossil energy as a bridging asset.
It follows logically that to be a future energy superpower Canada will need to make a major commitment to wind energy and to the grid investment and integration that this will require.
I believe Canada is uniquely positioned thanks to hydro resources—both existing and still to be developed—that create the perfect complement to wind generation.
In western Canada we have abundant hydro in BC and Manitoba. Sandwiched between, in Alberta and Saskatchewan, is tremendous wind and solar potential that awaits interconnection with stabilizing hydro from both east and west if only the four independent provincial systems could agree on a mutually beneficial collaboration. This should not be a big “if” but perhaps it is.
Meanwhile, in the eastern half of Canada we have an analogous situation—world-class hydro resources in Labrador and Quebec that can function as a mega-battery to complement wind generation, and particularly the virtually inexhaustible supply off our Atlantic coast.
In both national and regional terms this is clearly a win-win vision, so much so that I believe some version will be the inevitable architecture of Canada’s electrical energy future. But as they say: It can take a great deal of effort to bring about the inevitable! It will take a massive mobilization of capital to put in place the new generation facilities and the transmission infrastructure to connect it all to provide an enormous increase in the supply of reliable, affordable power right across the country.
Which brings us to the question of how Atlantic offshore wind can play a major role. This audience will be familiar with the advantages, but they should nevertheless be reiterated because there are skeptics whose support will be needed and who remain to be convinced:
- The winds on the Scotian shelf are world-class for energy generation—strong and steady, with peak average velocity in winter when grid demand is greatest.[7] There are large offshore areas at water depths that provide good fixed-bottom siting for turbines. The circled regions on the map (next page) were identified as particularly suitable according to a very broad range of criteria in a detailed Regional Assessment of Offshore Wind Development in Nova Scotia released last January. Just one of the areas, the Sable Island Bank, includes almost 5,200 sq km with water depths of less than 60 meters, an area that could in principle generate some 50 GW of power. [8]
- The Atlantic region has extensive offshore project experience stemming from oil and gas development and from generations of marine activity. While offshore wind development would be new to the region, it would build on transferable skills and infrastructure.
- Finally, but of critical importance in view of the large amount of wind generation that will be needed in eastern Canada, Atlantic offshore wind facilities will not be constrained by the NIMBY resistance and other land use conflicts that are endemic to settled areas of the country and even to more remote areas. By contrast, the evidence catalogued in the January Regional Assessment suggests that there is ample offshore area to site wind farms while fully accommodating other marine users and minimizing environmental impact. That said, more analysis will be needed as wind farm siting plans become specific.
Where does this leave us? On the plus side: Canada is destined to need a very large amount of wind-generated electricity, and the Atlantic offshore can provide a super-abundant supply, subject to three big challenges:
- Will the economics work?
- Will our publics be supportive?
- Will the relevant jurisdictions collaborate?
Let’s start with economic viability since this obviously is a threshold question. Both the magnitude of the opportunity and the scale-dependent economics of offshore wind development require us to think big—ultimately in terms of multi-gigawatt projects as the Province’s Wind West concept is targeting. This in turn depends on markets beyond the Atlantic region—Quebec, Ontario, and perhaps New England. Accessing those markets will require a major expansion of transmission infrastructure, including the possibility of undersea cabling to the US northeast, although overland to New England via Quebec is also an option. The good news is that there are already transmission corridors that interconnect all four Atlantic Provinces among themselves and with Quebec and thus into the Ontario market. These would need to be extended and their capacity increased significantly.
It comes down to whether Atlantic offshore wind can be cost competitive on a system-wide basis and in the context of competing sources of supply in the target markets as well as political and other non-quantifiable considerations. In other words, a project of this scale requires a lot of detailed analysis up front together with a serious commitment to interjurisdictional capacity planning and investment. But I’m getting ahead of myself.
The experience in other countries, particularly in Europe and China, proves beyond doubt that offshore wind can comprise a significant and growing component of the energy mix despite a present cost disadvantage relative to onshore wind and solar. (The latter two are often subject to other constraints—typically conflicting land uses.) What needs to be emphasized is that the economics of offshore wind energy continues to benefit from cost-reducing innovation, associated for example with increased turbine size. The cost of manufacturing will also inevitably decline thanks to the learning-curve effect of growing global production. In other words: wind technology has in common with solar and battery technologies—and unlike the relatively static technologies of hydro and natural gas—significant potential for continued relative cost reduction via a virtuous circle in which innovation reduces cost, which increases the scale of uptake, which further reduces cost. This will be a dominant planning consideration for investment horizons that span decades in the presence of a global shift in electrical generation technology to solar and wind power.
Nevertheless: the current cost of offshore wind generation and transmission to central Canada may limit the size of the potentially addressable market, possibly below a viable scale.[9] Clearly, a great many imponderables are involved in cost forecasting 5-10 years ahead, and consequently also in projecting offshore wind’s potential share of the eastern Canadian or New England electricity markets. Further light is being shed on these questions in an on-going series of authoritative studies managed by Net-Zero Atlantic under the rubric of its Grid Integration and Transmission Study, the first phase of which—analyzing market opportunities—was released in June. So stay tuned.
One thing that can be said for sure is that a lower all-in cost for offshore wind energy will create access to a much bigger market. That cost is bound up with the initial capital investment in the technology, primarily the turbines and the long-distance transmission, since the “fuel” will always come for free. Where is that technology cheapest? It’s in China by a very wide margin, as much as 50% below the next best supplier, which explains why China is dominating the market outside Europe.
This hyper-competitiveness is the result of many hard-to-replicate factors, including market scale and peerless engineering competence. But the most consequential factor is China’s unique industrial policy. The government initially supports creation of companies in a new sector but then leaves them to compete fiercely in the domestic market so that only the most innovative and efficient survive. It’s a process that wastes capital and produces the overcapacity that is characteristic of many Chinese industries. But it’s a process that creates incredible price benefits for China’s customers.
This raises a thorny question for the development of Atlantic offshore wind. Should we invite China’s supply chain to the table? The economic benefit is obvious and may even determine the feasibility of Atlantic offshore wind energy. On the other side of the ledger is, first, the concern of federal security officials that Chinese technology could be a Trojan Horse; second, the risk of incurring recriminations from the US administration; and finally, a concern that Chinese suppliers might freeze out Canadians.
In the case of offshore wind—as distinct from the auto and steel sectors for example—there is no existing Canadian industry to protect, although there would be several elements of the supply chain where our companies could already participate. But since offshore wind projects will depend almost entirely on foreign technology, at least initially, there would be little difference in terms of Canadian content between Chinese and European suppliers. It would come down to making Canadian content provisions, including incoming facilities investment, part of contract negotiations.
More problematic would be security concerns and perhaps the attitude of the Americans. I don’t believe that windmills pose the same sort of national security risk as, for example, the use of Huawei’s gear in our communications networks. But I’m no expert. As for the Americans—on a commercial issue like this, I believe that Canada has to assert its independence. After all, we and the Americans already have robust two-way trade with China across many sectors, so why not offshore wind technology as well? I would go further. If we’re serious about the electrical energy transition and its positive implications for the economy and for the climate, we must be willing to buy technology from the best and the cheapest source. Right now, that’s China—no contest.
And this just in. Speaking at the Council on Foreign Relations in New York two days ago (September 22), Prime Minister Carney described China as “very sincere and engaged on climate,” noting that it’s “a country that understands a lot of the engineering solutions to issues around emission. They’ve built real competitive advantage in a number of these areas as well.”
I would echo that view, adding an exclamation mark. And once we factor in the possibility of using Chinese technology in the offshore wind supply chain, the economics improve very significantly.
But while competitive economics are clearly necessary, economic viability alone is not sufficient. Novel and transformative projects like offshore wind energy inevitably have other consequences—impacts on the environment, on marine users, and on all aspects of life in affected communities. The novelty for Canadians of offshore wind energy naturally raises a fear of the unknown which manifests as an instinct to focus on the potential risks rather than the benefits. And there are risks. But being a follower, as Canada is when it comes to offshore wind, at least has the benefit of learning from the experience of others. That experience goes back some 34 years to the first offshore wind farm in Denmark. Since then there has accumulated a wealth of information which, in the aggregate, implies that the development of offshore wind energy can occur in harmony with the environment and with other marine users.
But Atlantic Canada isn’t western Europe; New Scotland isn’t Old Scotland; and the Scotian Shelf isn’t the North Sea. So, we need to delve deeply into our own circumstances. Fortunately, an enormous wealth of relevant information has been assembled in the Regional Assessment report tabled last January. While the tone of that document is cautious, and suggests many areas for further research—work that will be undertaken by many of you in this room—the overall message that I take from the assessment is that offshore wind energy can indeed be developed at scale while respecting the ocean environment and the needs of existing users of our marine resources.
That said, the message will need to be communicated in ways that can be broadly understood and above all, trusted. The lesson from other jurisdictions is that this will require transparency and continuous two-way engagement with a broad range of publics. The time to start is yesterday.
Which brings us to the third challenge—Will the relevant jurisdictions collaborate? This is perhaps the most daunting, but also the most within our collective grasp.
To underline what’s at stake, let’s summarize the story to this point.
- The world energy system is in the early stages of a transition to electrical dominance.
- That transition will eventually be dominated by clean generation—mostly wind and solar.
- The strategic implication for Canada requires a major commitment to wind energy.
- Fortunately, Canada is very favourably positioned thanks to the unique complementarity of massive hydro with virtually unlimited Atlantic offshore wind.
- The realization of this advantage depends however on developing offshore wind at very large scale and therefore serving markets in central Canada and potentially New England.
- This will require cost-competitive generation and expanded interprovincial transmission.
- The cost of offshore wind, relative to competing sources, will decline in response to technological innovation and scale. The evolution is being led by China which should therefore be acceptable as a supplier.
- Experience elsewhere, and studies specific to Atlantic Canada, indicate so far that offshore wind can be developed in harmony with the ocean environment and the needs of existing marine users.
That’s the big picture. It’s very compelling. It’s the message I want you to take away. Of course there are still plenty of gaps that need to be filled, and it’s hard to imagine a more stimulating and consequential research agenda for this audience. To that end, we need an organizational means to provide coherence for what will be a vast undertaking. So I am encouraged to see that our host, Net-Zero Atlantic, has recently published an Offshore Wind R&D Priorities Roadmap as a first step. Now that needs to be followed up with funding and organizational co-ordination.
Still, we’re missing one crucial piece. The future I have been describing can’t happen without the support and collaboration both of governments and of electricity providers and their regulators. The table is set but there must be more than lip service.
I cannot overemphasize that the world is embarked on an epoch-making energy transformation. Epoch-making opportunities demand a vision to match, which in this case depends on the willingness of our provincial energy systems to set aside traditional parochialism and embrace interjurisdictional capacity planning, transmission, and grid integration. I understand the politics, and I understand that energy utilities, for a lot of good reasons, are conservative and protective of their own jurisdiction. But when circumstances change so must our assumptions and our behaviour.
Why should we be optimistic?
Most fundamentally it’s because Atlantic offshore wind can contribute in a major way to an energy future whose evolution has now become clear.
And bringing it closer to home, we should be optimistic—realistically optimistic—because the governments of Canada and the Provinces now recognize that Canada needs to think big again. We need to do a lot more to set our own course. That is overdue. But it now finds expression in the Prime Minister’s determination to identify and support nation-building projects, and Nova Scotia’s Wind West proposal is exemplary of that noble objective.
[1] Between 2010 and 2014 global electricity generation increased 44% to 30,132 TWh. The only sources to increase share of the total were wind and solar—up more than 12-fold combined to 4,637 TWh.
[2] The learning curve describes the observed effect of production volume on per unit cost in virtually every production process. It is usually stated as the percentage decrease in unit cost for every doubling of volume. It’s the result of “learning by doing” and is a primary source of productivity growth.
[3] While there are emissions generated during the manufacture and installation of solar and wind infrastructure, these are very small relative to lifetime emissions reduction and will be further reduced as more of the supply chain is electrified cleanly.
[4] Coal’s share of China’s electricity generation has declined from 77% in 2010 to 58% in 2024.
[5] A terawatt hour (TWh) is a billion kilowatt hours or enough to power about 100,000 Canadian homes for a year. One TWh is the amount of energy generated by a 114 megawatt power source operating at full power for a year. Global electricity generation is currently more than 30,000 TWh, of which Canada produces about 2%, but in per capita terms, approximately four times the world average.
[6] Solar panels for utility scale use are now so cheap (if sourced from China) that they can be “wasted” in order to expand collection area at little cost relative to the total cost of installation. For example, while Toronto receives only about 70% as much annual solar input per unit area as Los Angeles, this can be made up by expanding the area of a solar array by 43%. The more significant disadvantage for Canada is that solar input is weakest in winter when demand is greatest. This can be addressed by overbuilding collection area and complementing with hydro and/or wind since the latter is strongest in winter. All of these adjustments should be facilitated by expanding grid interconnection to smooth supply across the broadest feasible range of sources.
[7] The power output of a wind turbine varies as the 3rd power of the average wind velocity—the kinetic energy per unit time being proportional to m*v^2, while the mass of air flowing through the rotor in a unit of time is proportional to the velocity. Thus, the annual power output in the presence of a 10m/s average wind speed is 37% greater than for a speed of 9 m/s—i.e., (10/9)^3.
[8] Future offshore wind farms will likely employ turbines of, say, 15MW with rotor diameters of about 230 m. Turbines are typically separated by up to10 diameters which implies power of roughly 10 MW/sq km, or about 50 GW if the potential area on Sable Island Bank were fully used, which is of course unlikely. Note that the distance between these massive turbines would be 2 km or more, making it easy for fishing vessels and other ships to pass.
[9] In European markets, for example, offshore wind electricity is being sold in a wide range of roughly C$85 to as much as $180 per megawatt hour. Meanwhile, Nova Scotia’s Wind West proposal foresees a levelized cost of C$170 delivered to Quebec, based on a five-gigawatt project with 1% financing from the Canada Infrastructure Bank and anticipated investment tax credits.
