Published on June 12th, 2017 | by Joshua S Hill0
A Quarter Of EU’s Electricity Demand Could Be Met By Offshore Wind At €54/MWh
June 12th, 2017 by Joshua S Hill
Up to a quarter of the European Union’s electricity demand could be met by offshore wind energy at an average of €54 per megawatt-hour in the most favorable locations, according to a new report published this month, which also suggests offshore wind could generate between 2,600 to 6,000 terawatt-hours per year.
These are the key findings from a new report published this month by renewable energy consultancy BVG Associates, for WindEurope, the wind energy trade body for the European Union. Specifically, the report looked at the “economically attractive resource potential” of offshore wind in the EU as well as the “location for lowest cost resource”, assessing them on two policy scenarios — a baseline scenario based on current frameworks and assumptions, and an ‘upside scenario’ based on what could happen if governments responded positively to cost reductions, as well as “if there are positive developments on grid access, market support mechanisms, site development and supply chain development.”
The report found that offshore wind could, in theory, generate anywhere between 2,600 and 6,000 terawatt-hours (TWh) per year at a competitive cost of €65 per megawatt-hour (MWh) or below, including grid connection, based on the use of technologies that will have been developed by 2030 — technologies such as 13 MW wind turbines (as compared to the largest currently ready for manufacturing, 9.5 MW). Amazingly, this would represent between 80% (for the baseline scenario) and 180% (for the upside scenario) of the EU’s total electricity demand.
Further, focusing solely on the most favorable locations, 25% of the EU’s electricity demand could be met by offshore wind energy at an average of €54/MWh. This assumes seabed-fixed foundations and includes grid connection, and in the baseline scenario would see development focused in UK, Denmark, the Netherlands, Germany, and France. Meanwhile, in the upside scenario, additional offshore wind capacity could also be added in Ireland, Poland, Latvia, and Lithuania.
Installed capacity in the baseline scenario to the end of 2030 for the EU member states in all sea basins
Installed capacity in the upside scenario to the end of 2030 for the EU member states in all sea basins
However, these are the best-case scenarios we could hope for, and WindEurope is currently focusing simply on EU governments working to see offshore wind account for between 7% to 11% of the EU’s electricity demand by 2030. To hit this target, the authors of the new report are calling on EU governments to:
- Commit to ambitious deployment for offshore wind to 2030 and beyond as part of national energy, climate and economic development plans
- Cooperate at inter-governmental level and with developers and suppliers to provide a continuous, sufficient and visible pipeline of projects that enables industry to deliver further investments in technology, skills development, job creation and cost reduction throughout the supply chain
- Coordinate the timeline of tenders across all the sea basins to provide greater investment clarity
- Cooperate in spatial planning analyses and site development to ensure that the areas of lowest levelized cost of energy (LCOE) are exploited whilst providing power to all the locations where it is needed
- Facilitate the development of international grid infrastructure including offshore grid connection hubs to support the exploitation of the lowest LCOE resource
- Offer market support mechanisms in a format that drives competition and supports successful project delivery, until the point that they are no longer needed
The report has been welcomed by wind energy advocates across the EU, especially in the (Brexiting) UK. The report specifically highlighted that the UK could install a total of 25 gigawatts (GW) of offshore wind energy by 2030, which is enough to power 75% of all UK households. Meanwhile, the report predicts that Germany could install up to 14 GW of new offshore wind capacity by the same time.
Cumulative installed capacity by country by the end of 2030
“This report shows what our innovative offshore wind industry can deliver in the years ahead, securing economic growth and cheaper electricity,” said Emma Pinchbeck, RenewableUK’s Executive Director, in response to the report’s findings. “The Government can help us by continuing to hold fiercely competitive auctions for financial support, as well as putting offshore wind at the heart of its upcoming Industrial Strategy. Clear, bold, modern energy policy will attract billions of pounds of investment.”
“The report confirms that the cost reduction seen in offshore wind over the last two years could translate into significant volumes of clean, competitive and reliable power for the UK by 2030,” added Giles Dickson, CEO WindEurope. “The UK should factor this into their long-term energy planning. We need to see a deployment of at least 4 GW per year in Europe for offshore wind to maintain its cost reduction trend. This would allow offshore wind to be competitive with conventional power before very long.”
The new report was accompanied by a WindEurope report which highlighted the fact that floating offshore wind energy technology is no longer a demonstration technology, and is ready for the big time. Specifically, the report highlighted a current pipeline of floating offshore projects totaling nearly 350 MW, and an estimated European potential of 4,000 GW.