Europe has more than one third of the globe’s offshore wind potential and is well positioned to benefit from the expertise and supply chains established by the industry’s pioneers in the continent’s north.
With some 25 gigawatts (GW) of installed capacity, Europe is offshore wind’s global leader. However, studies by the World Bank’s Energy Sector Management Assistance Programme (Esmap) show this represents just 0.1% of its technical potential.
The industry’s role in tackling global warming has come into sharp focus in recent weeks following the Global Wind Energy Council’s finding that the world has installed just 2% of the offshore wind generation needed by 2050 to avoid the worst impacts of climate change.
Home to 35% of the 71,470GW of technical offshore wind potential identified by Esmap globally, Europe should capitalise on their proximity to the North Sea states which have spearheaded the industry.
“If you are looking into the Black Sea and Mediterranean there are benefits from northern Europe,” says Esmap’s senior energy specialist in offshore wind, Mark Leybourne. “Spillover effects include comparatively low transportation costs and close supply chains. That’s in contrast to the US which has to rely on European imports to support its offshore wind pipeline.”
More than half of Europe’s 25,147GW technical potential is in Russia, where the government has yet to start developing an offshore industry. But most other European states with a viable resource and decent energy demand are making plans. “It is something countries have really woken up to over the past few years as the industry has matured and we’ve seen costs plummet,” says Mr Leybourne. The price of offshore wind has fallen nearly 70% since 2012 according to Esmap.
New floating markets
Europe’s other top contenders are Norway and the UK, which has installed 0.5% of its 1864GW potential and is the world’s second biggest offshore wind generator after China. Another is Denmark which built the world’s first offshore wind farm in 1991, but to-date has installed just 1.7GW.
Two countries moving quickly to capitalise on their relatively modest resource are Belgium and Germany, which have installed 17% and 4% respectively of their technical potential. France is at the other end of the spectrum. Despite its 623GW potential, and having tendered its first project in 2011, local content requirements and permitting issues mean it operates just a handful of turbines today.
Development in the Mediterranean will ramp up once the nascent floating industry matures. Today the vast majority of offshore turbines globally are fixed, but waters deeper than 60 metres require floating platforms. Recent progress on floating projects has started to reduce risks and increase familiarity with the technology. “As that rolls out I think we’ll see some significant cost reductions as at the moment it is expensive,” says Mr Leybourne.
That is good news for Spain, Portugal, Italy and Greece. All are looking to expand into offshore wind, but more than 92% of their technical potential is beyond the shallow waters needed for fixed turbines.
Central and Eastern Europe has no installed capacity to date, but its growing energy demands, reliance on fossil fuel and governments proactiveness make some countries ripe for development.
Poland is a prime example. Among the most polluted countries in Europe, this year it passed laws to develop offshore wind, and it wants to generate 5.9GW by 2030. It’s also a top contender in benefiting from spillover effects. “There is a lot of industry and supply chain from countries like Germany and Denmark that are very close, by which it can quickly capitalise on the cost reduction we’ve seen elsewhere,” says Mr Leybourne.
For many emerging markets, “strong government engagement and commitment is the key” to developing offshore wind, he adds. Two places where this is happening are Romania, which is aiming to pass offshore legislation this year, and Ukraine, whose 250GW of potential is greater than that of industry leaders the Netherlands and Germany.
The World Bank is helping the Turkish government investigate its 76GW of potential and design a future tender. “It has some areas of good wind speed and a lot of those are pretty close to demand centres,” says Mr Leybourne.
The technical capacities identified by ESMAP are based on wind speed and water depth. Once environmental, social, economic and other constraints are factored in, only a tiny fraction is likely to be suitable for development. But just a small percentage of technical potential must be deployed to meet global power demand, “and there will always be somewhere in these countries where it will be viable from all those perspectives” adds Mr Leybourne.
One of the biggest challenges, particularly for emerging markets, is developing robust policies and regulatory frameworks for an industry which Mr Leybourne describes as marrying “the complexity of offshore oil and gas extraction and the scale of large hydro”. Another is a grid strong enough to absorb more than 250MW from a single source, and stable enough to continue if that source fails to generate.
The World Bank is using Esmap’s studies, which were published last year, to discuss offshore wind opportunities with governments. For some countries, learning their technical capacity has “quite often…been a revelation”, says Mr Leybourne.