The European offshore wind power industry attracted a record $15.3bn (EUR14bn) in new investments during the first six months of 2016, but the head of WindEurope says cost reduction continues to be imperative.
Meanwhile Catapult Offshore Renewables has told Power Engineering International that they are confident that Brexit will not negatively impact on the work they are doing in the offshore renewables space.
Seven projects reached final investment decision across Europe this year, financing a total of 3.7 GW of new capacity. The UK accounted for nearly three-quarters of the new investments.
The volume of new grid-connected installations in the first half of 2016 was 511MW, 78 per cent down on the same period in 2015.
Giles Dickson, CEO of WindEurope, said: “The record investment numbers show a clear industry commitment to offshore wind. We expect installations will pick up significantly in 2017 but there are a lot of challenges out there still on offshore wind. Not least the uncertainty over future volumes and regulation in many key markets for the period after 2020. We’re a long way from being able to say “job done” on offshore wind.”
But Dickson’s main concern is that the industry continues to sustain the volumes required to innovate costs down, something he believes is critical to the long term health of the sector.
“The costs of offshore wind are falling, but we need healthy volumes in the market to sustain this. The current pipeline of projects is not enough, and the commitments Member States have so far made for beyond 2020 fall well short of what’s needed. This risks undermining Europe’s competitive position in offshore wind.”
“Clearer deployment goals and long-term visibility on tender volumes and timetables will mean a strong industry and supply chain – and competitive bidding leading to lower costs. It will also mean lower costs of capital, and with offshore wind so capex heavy, this is key to total cost reduction. Coordination of national tenders – which the 9 countries committed to in their recent MoU – will also help.”
In a separate development Catapult Offshore Renewable Energy (ORE), the UK’s flagship technology and innovation centre project dedicated to reducing the costs of offshore wind energy, has allayed fears that the recent Brexit vote will have a knock-on negative impact on their research.
Dr. Stephen Wyatt, ORE Catapult’s Strategy & Commercialisation Director, told Power Engineering International, “Whilst there will undoubtedly be a period of uncertainty as the UK Government seeks agreement on the future relationship with the EU, ORE Catapult remains confident of maintaining the strong momentum we have created over the past three years. We fully expect to deliver our part in the £16m+ of research projects we already have underway and to continue to develop future collaborative research programmes with our European partners.”
“We will continue to make the strongest representations to Government as to the value of continued investment in science and innovation, and of the broad economic and social benefits of the offshore renewables industry”.
Total installed offshore wind capacity in Europe now stands at 11,538 MW across 82 wind farms in 11 countries. Only Germany (258 MW) and the Netherlands (253 MW) added new capacity in the first 6 months. The average size of the 114 new turbines installed was 4.8 MW, up from 4.2 MW a year ago.
In June, energy ministers from nine European countries signed a Memorandum of Understanding (MoU) and Work Programme to enhance their cooperation on offshore wind. In parallel 11 energy companies signed a declaration to reduce offshore wind costs to below EUR 80/MWh by 2025. This assumes an annual build-out of 4-7GW of offshore wind from 2021 onwards.
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