Based on remarks by Joachim Balke, Head of Unit Networks & Regional Initiatives, Directorate General for Energy, European Commission at Global Transmission’s “Offshore Wind Transmission Europe 2020” virtual conference
Offshore wind is surging ahead in Europe and is now a key component of the European energy transition agenda. Strong support from policymakers and regulators, the drastic fall in technology costs, demonstrated competencies in installation, and economic success in recent auctions has heightened interest in the offshore wind industry. Global Transmission Report recently organised a virtual conference on Offshore Wind Transmission to highlight the opportunities and discuss technologies and solutions for the development of the next wave of offshore wind transmission infrastructure in Europe. Joachim Balke, Head of Unit Networks & Regional Initiatives, Directorate General for Energy, European Commission delivered the keynote address at the conference. Given below are the key highlights from his address…
The commission has decided to come up with an exclusive strategy for offshore wind power. This is particularly relevant in the context of the recent Green Deal in Europe along with the goal of having net zero emissions by the middle of the twenty-first century. Offshore energy is slated to play an instrumental role in building a power system largely based on renewables to reach the 2030 and 2050 energy and climate objectives. This net-zero objective is ambitious and will require an array of policy changes in sectors beyond energy as well. Offshore wind has the potential to contribute to a sustainable and inclusive post-Covid-19 recovery.
Achieving energy goals would require a higher degree of electrification and more electricity generation. This electricity will have to be by and large based on renewables. The European Green Deal has a strong long-term vision about how the energy sector should develop. It is important to set the right incentives, since the investment cycles in the energy sector are long. In the short-term, the priority is to relaunch the economy in a post-Covid situation. With the recovery in motion, the coming investments should be able to trigger economic activity, stimulate growth and create job opportunities, while being in line with the long-term goals of carbon neutrality and sustainability. In this context of satisfying short-term as well as long-term needs, offshore wind energy can play a very important role.
The European Union (EU) is currently a global leader in the offshore renewable energy space, which places it on a different starting point compared to other clean technologies. In the case of offshore wind energy, maintaining this global leadership role will be particularly challenging considering the global growth expectation in this segment. Europe has achieved this position due to various factors, one of which is favourable natural conditions. It has one of the world’s best offshore wind and ocean resources, with proximity to demand centres.
In Europe, offshore wind is expected to grow faster than onshore wind as well as other renewable technologies. The potential in offshore wind and renewables is quite distributed across Europe. There is offshore wind potential in all the sea basins, which are the basins of the North Sea, Baltic Sea, North Atlantic, Mediterranean Sea and Black Sea. Among these, the North Sea has been the frontrunner in the deployment of offshore wind. While there is significant potential across various sea basins, the geographical conditions vary widely. There are different sets of technologies which are better suited for each of these regions, which bring with them a unique set of challenges.
Europe is also leading in terms of jobs, the supply chain and domestic production. Currently, there are 33,000 direct jobs in the offshore wind industry, while there are 140,000 indirect jobs in both onshore and offshore wind. There is a well-established Trans-European industry and supply chain for offshore wind. As of now, a vast majority of offshore wind turbines stand in European waters. However, the demand in Asia and North America is expected to outstrip the European demand in the coming years. This may either result in these regions developing their own supply chains, or may present an opportunity for European exports.
“…the demand in Asia and North America is expected to outstrip the European demand in the coming years. This may either result in these regions developing their own supply chains, or may present an opportunity for European exports.”
Upscaling offshore wind
As per the figure below, offshore wind power is among the faster growing electricity generation technologies compared to other renewable energy alternatives. This points to an enormous upscale in terms of capacity addition in the coming years. Offshore wind is expected to grow by a factor of 10 or 20, which will result in an all new set of challenges to overcome in the future. There is a need to think about how to integrate the additional volumes into the system in an intelligent manner. The cost effectiveness is also something that needs to be considered in such an upscaling scenario.
There are various renewable energy technologies that can be used to set up projects in water bodies, some of which include floating PV, wave energy, tidal energy, floating wind and offshore wind. Of these technologies, offshore wind is the only one which is presently functioning at a commercial scale with a 12 GW installed capacity at sea in EU28 as of end-2019. While floating PV is still in the early R&D phase, wave energy, tidal energy and floating wind technologies are being developed with the latter two having some market uptake as well. There are benefits of having a wide portfolio of renewable technologies.
Integration of renewable energy into the system is one of the key challenges faced by the sector. If the upscaling happens on the level that is being expected, it is important to think about how to roll out the new generation of electricity in an efficient manner. Beyond the quantitative changes, there will also be more qualitative changes in the power generated by the additional offshore wind turbines which will need to considered.
“Beyond the quantitative changes, there will also be more qualitative changes in the power generated by the additional offshore wind turbines which will need to considered.”
Developments have so far mainly been close to the shore, thus there has been a radial connection to the national power systems. Going forward, the new capacity added will be farther away from the shore compared to existing turbines. This may be more difficult to integrate into the system due to the increased distances. While sea spaces are limited, some sea areas are also likely to see more concentration of offshore plants as compared to others. The North Sea, the Baltic Sea and parts of the Mediterranean Sea are likely to become such hotspots. This will need planning to ensure that the developments are carried out in a sustainable fashion.
Most of the generation potential in Europe is close to demand. However, as the generation increases, local generation may outstrip demand in a regional level. This will lead to the need to transport part of the production over longer distances.
There are two directions into which the offshore segment will move. Firstly, there is a need for more integrated offshore grids, including hybrid structures. Secondly, there needs to be better system integration. There is also potential for using some of the generated power to produce hydrogen and transported to the ultimate destination for consumption.
To reach the goals set for 2050, there is a need to enhance regional cooperation and develop a strategic approach. The strategy will need to address some key issues. These include addressing offshore as well as onshore grid planning, market arrangements and renewable energy support schemes. There is also a need to address multi-use of sea space and articulation with environmental and biodiversity aspects. There is “competition of use” for the space. The strategy should ensure that there is enough space for development in all aspects. EU industrial and technological global leadership will also be supported by the strategy to ensure inclusive and sustainable growth promoting regional cohesion across the region. Regional cooperation in this space will be the key element in this regard, especially to enhance research and innovation in offshore wind and other renewable energy spaces.