Renewable Energy World
We have all followed with great interest the extraordinary breakthrough in European offshore wind over the past few years. After struggling for a number of years with increasing prices as projects moved further offshore and into deeper waters, the first real breakthrough came in early 2015 with the Horns Rev 3 project where Vattenfall’s winning bid of €103/MWh foreshadowed meeting the industry’s target of €100/MWh by 2020. This was followed in 2016 with a number of bids in both Danish and Dutch
tenders with prices well below that, and in 2017 and 2018 resulted in a number of bids for which all that was required was the wholesale price of power.
While this is not the norm, it shows that the improvements in technology (especially larger and larger turbines) along with a well-developed supply chain, advances in installation and operation and maintenance strategies and experience (along with very low cost of capital) has made offshore wind a competitive source of power going forward in Europe.
One of the knock-on effects of this, of course, is that now what was a slow development of what was viewed as an expensive technology has attracted a great deal of attention outside Europe, in Asia, the Americas and even Australia.
The main market outside of Europe for the past few years has, of course, been China. The Chinese offshore industry has struggled to build up a head of steam over the last 6-8 years, but now seems to be hitting its stride, installing 1,100 MW of offshore wind in 2017 for a cumulative total of nearly 2.9 GW — about 15 percent of the global market; and it seems to be on its way to hitting its latest 2020 target of 5 MW well ahead of time. Provincial governments, especially Jiangsu, Guangdong and Fujian have now gotten involved and have set their own targets, which add up to a pipeline of about 7.5 GW by 2020. For the long term, there are about 60 GW of projects identified.