Eoghan Quinn / Global Wind Lead / WorleyParsons Group
In 2017, the offshore wind industry hit milestones and made headlines. That breakthrough year saw the sector become more commercially viable and realize more of its considerable global potential than ever before.
Wind Europe stated that last year (2016) the sector added a spectacular 25% of capacity. That was on average, the capacity of 500-turbines connected to the grid. What’s more, the Global Wind Energy Council reported offshore wind had its first ‘subsidy-free’ tender in Germany, for more than 1 gigawatt (GW) of new offshore capacity.
And that was just the start. Having made the leap from onshore to offshore, the industry is poised to make another equally significant move: the jump from fixed base to floating offshore wind. As with the first shift, this entails new layers of fiscal, technical, operational and regulatory complexity. It’s a tough challenge, but the rewards are enormous because the vast majority of potential global offshore wind resource is in waters too deep for traditional fixed offshore wind.
The leap is similar to when the oil and gas industry started building floating structures in the 1970s, a move which also opened new deepwater markets such as the Gulf of Mexico, Latin America, and West Africa. It’s a high risk, high reward strategy. And just like the evolution of floating structures in oil and gas – SPAR, tension-leg platforms, and even new low-motion FPSOs – if those tapping into floating offshore wind want to get it right, they will need to draw on the expertise of those familiar with the complexities of designing, building, operating, and maintaining assets in these highly complex offshore environments.
Wind is in the ascendancy. The last 12 months were monumental for the sector, with major projects for developers such as Orsted, Vattenfall, and Statoil agreed without subsidies for the first time in the industry’s history. A target to reduce costs to €100/megawatt hour (MWh) by 2020 was surpassed four years early – and by a significant margin. And more than 3,000 MW of new offshore wind capacity was installed in Europe alone (double that in 2016), taking the total to nearly 16 GW.
Yet, the industry is just scratching the surface. Most of today’s installed capacity is in shallow water. It’s what you might call the low hanging fruit.
Some 80% of Europe’s potential offshore wind resource is located in more than 60-m deep water. This equates to 4,000 GW of untapped potential in Europe alone, with – for example – a further 2,450 GW in the U.S, 500 GW in Japan and 90 GW in Taiwan, according to the UK’s Carbon Trust and Taiwan’s Ministry of Foreign Affairs.
Fixed-based wind is not viable at these depths. But floating wind is. It can surmount the engineering challenges of deepwater installation and it offers a different approach to construction that also yields benefits. For example, instead of most building work happening onsite at-sea using expensive heavy-lift vessels, turbines can be mostly constructed quayside and pulled into position by less costly and readily available tugs. Manufacturing and construction costs could tumble.
By opening up deeper waters, floating offshore wind also make projects feasible in more remote locations, which typically means more powerful and reliable wind. Though this must be weighed against higher transmission costs, it is another potentially powerful economic string to floating offshore wind’s bow.
It’s perhaps unsurprising that developed and developing nations are now pursuing offshore wind farms thanks to the significant cost reduction in fixed bottom wind (a 32% decrease since 2012 according to Offshore Renewable Energy), and the increasing confidence in offshore renewables as an investment proposition. In 2017 alone, more than €7.5 billion was invested in new European assets.
Japan has been trialing a number of floating offshore wind prototypes. France has launched ambitious plans for a string of pilot projects off its coast. And Norway recently agreed to move forward with demonstration projects in its own waters. These countries see the potential to build their economies around renewable energy. This energy transition is backed by major oil and gas developers, looking at ways to reduce their carbon footprint by diversifying their core business.
Last year was a turning point for the floating wind industry. Statoil installed the world’s first floating grid-connected offshore wind park, Hywind, offshore Scotland. The 30MW, five-turbine pilot wind park has already performed better than expected, despite experiencing a hurricane and wave heights up to 8.2m during its first three months in operation.
Statoil reports that the typical capacity factor for a fixed offshore wind farm during winter months in the North Sea is a respectable 45 to 60%. More remarkably, Hywind achieved 65% during November, December and January 2018. The fact that a pilot floating project is already meeting and surpassing the performance standard set by its fixed-base forbears bodes extremely well for floating’s future.
It’s a great start, but this is still a young industry. As fixed offshore wind considers 16 MW turbines as tall as London’s Shard (3 MW was considered ambitious just five years ago), the floating wind farm is still in its infancy. There’s not one technology proven to the point that it can be purchased off the shelf. A Carbon Trust study identified 30 different concepts in the market, mostly based on semi-submersible, tension-leg platform or SPAR structures, all of which, have been borrowed from oil and gas. However, many of these systems have yet to be tried, developed and proven for floating applications.
As firms start to move from concept to trials and even pilot arrays, they will need specialist expertise to de-risk and optimize their designs for the full project life-cycle. Some of these challenges will be technical, such as developing dynamic power cables that can survive harsh offshore environments or designing foundations and mooring turbines to the seabed. Others will be regulatory, such as the U.S.’ Jones Act, which prevents developers from sourcing equipment from abroad, pushing up prices. Nor do the obstacles stop at construction: there will undoubtedly be operations and maintenance challenges, constraints around vessel availability and difficulties in servicing floating arrays efficiently.
These challenges are not insurmountable. With the right experience and support, floating offshore wind can become an economic reality. The U.S. Department of Energy’s projections suggest floating foundations will be cost-competitive with fixed wind by the mid-2020s, while IRENA predicts that the first large-scale floating windfarms could be installed by 2025.
We will start to see concepts that draw on existing capabilities, such as concrete structures that can be built, floated out and moored. We’ll also start seeing systems that are scalable and efficient, using off-the-shelf turbine towers, similar to the IKEA-style model we saw for onshore wind.
Success will come down to unlocking complexity, and one of the surest ways to boost its chances is to rely on proven expertise. But how do you find that experience in a fledgling sector?
One option is to look sideways. There are decades of accumulated relevant expertise in the oil and gas sector, dating back to the North Sea’s first floating production systems in the 1970s. There are people who know the environment and have cracked the main engineering challenges, with the experience to navigate the complex marine environment.
There are also experts working with governments and investors and reducing project costs. On the other side of the energy coin, there is a burgeoning pool of expertise in renewable projects, specifically wind. Developers who can collate this expertise, either in-house or through partnerships, will be best placed to succeed.
The WorleyParsons Group can draw on decades of experience across the traditional and renewable energy sectors and are working with governments and companies around the world on onshore and offshore wind projects. For example, we are advising one partner on how floating wind can augment the power supply to an oil and gas production facility. Each project presents different challenges and opportunities, but one consistent driver is the growth in the renewable market supported by the momentum of the global energy transition.
Floating offshore wind offers huge global green energy potential and projects are getting bigger and more multifaceted. But these complex, deep offshore environments will require robust technology, strong onshore infrastructure, and the right expertise to ensure success. By partnering with companies in this space, the sector can unlock that complexity and begin to realize its considerable potential.
About Eoghan Quinn
Eoghan Quinn is a renewable energy sector specialist with over 10 years’ experience as a technology and business leader with a wide skillset covering renewables and engineering. Eoghan was previously responsible for WorleyParsons’ Western Australia New Energy business line, working strategically with multinational clients on their energy transition. As Global Wind Lead, Eoghan now heads the global offshore wind initiative for WorleyParsons Group.