Offshore Wind Embarks Beyond Europe

By Robin Yapp, Contributor
December 31, 2012 

Although Europe still dominates global offshore wind, with much of the world's total capacity in the Baltic and North Seas, more nations are waking up to the sector's potential.

 

More than 20 years after the world's first commercial offshore wind farm opened in 1991 in the Baltic Sea off the coast of Vindeby, Denmark, the industry continues to be dominated by Europe.

Global installed offshore wind capacity stood at 4.62 GW at the end of June 2012, of which 90% was in northern Europe, according to the Global Wind Energy Council (GWEC). Furthermore, the North Sea – and a handful of nations led by the UK and Denmark – dominate the industry in Europe. More than half of global on-line offshore wind is in the North Sea.

Despite huge coastal populations around the world, most regions have shown little appetite for investing in the sector. Even the news that EU countries have surpassed 100 GW in total installed wind capacity served as a reminder of how far the offshore industry lags behind land-based wind.

At present, the offshore segment constitutes just 2% of total global wind capacity, which itself provides only 2.5% of global electricity. Yet offshore wind’s long-term potential is enormous.GWEC estimates that offshore wind could meet Europe’s energy demand seven times over and US energy demand four times over. China, the global leader in installed wind capacity with more than 62 GW onshore, has barely begun to exploit its offshore resources, estimated to total a potential 750 GW – three times its onshore potential. By 2020, offshore’s share of global wind capacity will reach 10%, according to GWEC.

Offshore wind farms offer advantages over onshore turbines that could help encourage greater investment. Higher and more consistent wind speeds and taller turbines with larger blades can help achieve capacity factors of up to 50%, compared with about 30% for a typical onshore farm. The proximity of many offshore turbines to heavily populated coastal areas often makes grid connection easier and cheaper than extending new transmission lines over remote areas of land. Strong daytime offshore winds can also offer greater potential for matching supply with peak electricity demand, and offshore farms generally avoid the risk of opposition on aesthetic grounds.

The 25 turbines at the UK’s Burbo Bank Offshore Wind Farm in Liverpool Bay

total 90 MW but a planned extension would add 250 MW (Siemens)

Set against these advantages are several drawbacks that have limited offshore development in many countries: a shortage of shallow waters, insufficient technological know-how and a lack of political backing, to name but three.

Then there is the issue of finance. While costs can vary greatly, the substantial additional investment required for offshore construction, operation and maintenance compared with onshore projects has acted as a severe and sometimes prohibitive brake on developments.

Average cost for offshore projects commissioned in the first quarter of 2012 climbed beyond US$230/MWh compared with about $176/MWh in the same period of 2011, according to Bloomberg New Energy Finance (BNEF). Offshore wind remains nearly twice as expensive to install as onshore wind, according to a June 2012 working paper published by the International Renewable Energy Agency (IRENA).

The Big Question: What is Onshore Wind's Future in Europe?

By David Appleyard, Chief Editor, Renewable Energy World Magazine
December 12, 2012 

 

LONDON -- Renewable Energy World asks leading players in the industry for their verdicts on a key question of the moment. In this edition we asked for views on European onshore wind:

Onshore wind installations in Europe have slumped behind forecasts amid a protracted economic crisis. What does this mean for the future of onshore wind in Europe? And where should it now look for growth?
Justin Wu, Head of Wind Insight, Bloomberg New energy Finance
Onshore wind in Europe has peaked and is currently facing slow decline. We forecast the EU-27 to install a record 9.3 GW of onshore capacity in 2012, but for the total then to decline to less than 7 GW per year in 2013 and 2014 due to policy uncertainty in several large markets and the continuing financial crisis in southern Europe.
Further growth in the longer term would come from two areas: the emerging markets in Eastern Europe and the market for repowering of old turbines. There are several new markets in Eastern Europe such as Romania, Serbia, Croatia and the Ukraine that have growing electricity demand and excellent wind resources. They are implementing new policies to encourage wind development as they retire old coal-fired power plants, seek energy independence and increase their use of renewables to match EU standards. Further north, the Baltic countries, Finland and Sweden are also promising markets that are looking to accelerate growth in order to meet their targets.
Europe is also home to some of the oldest wind projects in the world and as these turbines age further, repowering or upgrading them to modern machines makes increasing economic sense. By 2020 there will be 12.8 GW of projects more than 20 years old in Europe that will need to be repowered and a further 24.5 GW between 14 and 18 years old with potentially high enough operational costs that will make repowering attractive. Most of this repowering will start in Denmark and Germany, but reach Spain and other European markets by the end of the decade.