The world is headed towards a net-zero carbon future, characterised by a profound shift towards electrification and electricity generation from renewable sources. Mark Venables investigates the role that wind energy will have in this low carbon future.
While electricity is less than 20 per cent of the energy mix today, it will more than double its share by 2050, according to DNV’s fourth Energy Transition Outlook report. The dedicated power supply and use report forecasts that average capacity factors in the wind industry will keep increasing in all regions with significant expansion in Greater China, Europe, the Indian Subcontinent and North America.
In just a few decades, power systems in most regions will be dominated by solar and wind which will provide 24 per cent of the world’s electricity in 2030 and 62 per cent by mid-century. Installed wind capacity could increase ten-fold to 4.9TW for onshore, 1TW for fixed offshore, and 260GW for floating offshore wind.
The drivers behind the growth of wind
“There are several mega drivers fuelling massive growth in offshore wind,” Peter Brun, global segment leader for offshore wind with DNV, says. “Magnified climate change effects making consumers increasingly aware of the need to change towards greener energy sources, advances in technology lowering the costs of renewables, further electrification of society and local job creation from local plants will all shift the discourse around renewables and act as catalysts for their growth. Investors view renewables as an increasingly attractive financial prospect for replacing fossil fuel systems.”
Though wind generation is predominantly onshore today, offshore wind’s contribution will continue to grow, reaching more than a quarter (28 per cent) of total wind production by 2050. “Wind capacity additions should consistently exceed those of the previous decade until 2050,” Brun adds. “By then, solar and wind power will become the main providers of power generation. The pace of expansion will be highest for fixed and floating offshore wind as they start from a lower base.”
Advances in wind turbine technology, the economies of scale stimulating further industrialisation of the industry, and smarter technologies and operations will further reduce the levelised cost of energy (LCoE) and cut installation time, making offshore wind increasingly attractive for investment.
“For floating wind, this decade will see rapid progress from demonstration projects to commercial-scale deployments meaning that, by 2050, floating offshore wind projects could have 255GW of installed capacity, more than a fifth of the offshore wind market,” Brun explains. “Offshore wind will generate almost nine per cent of electricity globally by 2050, compared with 0.3 per cent today. Bottom fixed offshore wind will grow well beyond 1TW installed capacity and in our forecast, we estimate with our current technology knowledge an increase to a staggering 1014GW in 2050.”
Where is growth going to take place?
While the energy transition will drive change for power systems and grids, electricity markets will be essential enablers for the transition. Investment in transmission infrastructure will need to increase when long-term plans to develop 300 GW of offshore wind in the North Sea by 2050 materializes. Sharing the risks will require completely new approaches, such as joint maritime spatial planning, interconnected offshore transmission grids, and hybrid offshore wind farms.
“Offshore wind energy islands, including hydrogen facilities at sea, might become a reliable power source if sufficient investment is made in large-scale interconnections and development of supergrids for the deployment of offshore wind,” Brun continues. “In Greater China, the Indian Subcontinent and Europe, expansion of grids to cover larger market areas will move from interconnection to supergrids via extreme and ultra-high-voltage systems for long distance transmission.
“Governments in Europe are focusing increasingly on larger-scale and cross-border infrastructure projects. These projects will require additional market design and operating rules to support business models for offshore wind projects in cross-border hubs, as well as for the production and integration of green hydrogen in the energy system.”
What are the challenges ahead?
New, unproven turbine technology deployed in extreme weather and site conditions, lack of government frameworks in emerging markets, limited or aging transmission and grid capacity, all need to be addressed to make offshore wind more appealing to investors. Proper testing, adoption of international standards and independent certification will play a crucial role, as it has in the last 40 years, for prudent and proper project and technology risk mitigation.
“National governments around the World must commit to post-pandemic economic stimulus packages, bold policies and supportive infrastructure regulation to drive the uptake of low or zero-carbon solutions,” Brun concludes. “Such an approach will show sustainable use of public stimulus in the Post-Covid-19 economy. To truly accelerate the pace, higher carbon pricing, rapidly scaled and deployed renewable technology, expanded digitalized regional grid infrastructure, and greater energy-efficiency measures are urgently needed.”
Adoption challenges for wind
Despite ongoing commitment from European governments to enhance renewable energy across the continent to fulfil their climate and energy objectives by 2030, there is still a long way to go in terms of implementation and acceptance of these projects. With many European countries increasing their project pipeline for on- and offshore wind in the next ten years to meet, on average, a 34% reliance on wind energy, what issues will successful project implementation face and where do the opportunities lie?
“The long-standing debate of offshore and onshore continues to be a heavily disputed topic for global bodies, who often face the challenge of weighing up local acceptance and moving at pace to match the global agenda,” Lorenzo Palombi, director of wind projects EMEA, BayWa r.e., says. “Onshore and offshore wind are both necessary applications to achieve its targets and complementary depending on physical and climatic conditions. For example, we expect to increasingly see greater emphasis for offshore wind in Northern Europe whereas in Southern Europe, unfulfilled potential for onshore wind will be pivotal to the region’s decarbonization goals.
“Traditionally, offshore wind has been viewed as being more complex than onshore wind, which is more mature in nature. This is due to offshore development requiring more investment and capacity. However, the tide may be turning we expect offshore wind capacity to surge to 1,400 GW by 2050 according to the Ocean Renewable Energy Action Coalition (OREAC) and LCoE to decrease significantly over the coming years – exemplifying the performance and efficiency potential of offshore wind.”
Palombi points to a blend of social and political factors that are all impacting the growth of wind projects. “From a social perspective, NIMBYISM and community resistance have greatly increased the completion time for projects, highlighting the growing need to work closely with local communities and proactively involve them in the development process,” he says. “From a political standpoint, the stringent approach to permitting and processes does not match with the speed of the climate crisis.
“We are increasingly seeing the pace of innovation and progress move faster than bureaucracy allows. The reality being that the local political processes do not match the commitments to green energy at a European level.”
Like all sectors, digitization will increase the ability to streamline operations, integrate farms into the physical landscape and optimise energy produced. “We also expect storage to grow in importance as penetration increases, highlighting the need for greater capabilities and reliability,” Palombi adds. “Floating wind is another innovation in the ever-growing energy mix portfolio and is expected to prove a more viable option for those counties which need to consider deeper water. However, as offshore wind developments take on average 7-10 years to implement, we cannot expect to see floating wind come to fruition until around 2030. And whilst it is an exciting new solution, adoption of floating wind will need to be tailor made for the future trajectory of each country.”
The future is transportable electrons
According to Ian Hatton, chairman, Enterprize Energy, the future of offshore wind will largely be shaped by transportable electrons, as renewable energy developers look to open new markets and access the best possible wind resource without relying on national grid networks.
At Enterprize Energy they are investing in prototype offshore technology that combines offshore wind, hydrogen, and ammonia in a single platform to create multiple transportable energy outputs. Green ammonia is a critical maritime fuel, for example, and green hydrogen is set to take a transformative role in industrial heating. “However, this is not solely intended as a route to provide commercial products derived from wind energy; in our view, a key reason for developing transportable electrons is to get projects up and running in markets with huge potential for wind energy but limited grid capabilities, fast,” Hatton says.
By taking advantage of existing infrastructure such as cargo vessel routes and oil and gas pipelines to transport energy to shore in the form of hydrogen and ammonia, it will be possible to avoid expensive, often glacially slow development of the grid and stop limited capacity being a roadblock to renewable energy project development.
Likewise, by removing the grid from the equation it will be possible for new wind energy markets to benefit from establishing a local supply chain sooner rather than later.
“In many of these emerging wind energy regions, decades of local oil and gas manufacturing capabilities and expertise can be retained and given new life by the renewable energy sector,” Hatton adds. “Foundations can be manufactured in existing factories, offshore support vessels can be built in existing shipyards, marine surveying teams can take a new brief from offshore wind developers – all that is required to kickstart the future of wind energy in these regions is a collaborative approach to local capacity building, with guidance from international wind energy expertise.”
The future of wind energy will also be further out to sea than ever before. Whilst floating wind technology is still very much in the development and proof of concept stage, the direction of travel for wind energy is clearly towards deeper and deeper waters. “While the details and commercial prospects of floating technology are refined, we will also see established buoyant foundation technology like ODE’s initiative with AWC Tech become increasingly common, particularly as the simple concrete foundations can provide local manufacturing boosts,” Hatton explains. “We are also likely to see an increasingly oil and gas style approach to development in the future of wind energy. Not only owing to oil majors investing in clean assets but owing to the need for existing renewable energy developers to take a ‘resource first’ approach to the siting of new wind projects.”
Most offshore wind developers currently take a market-first approach. This has meant developing projects where the right political environment and supply chain exists, primarily in Europe, and developing a wind farm just off the coast where it is easy and cheap to connect to the grid. However, this risk-averse approach to energy has limited offshore wind development to specific areas, often with a limited resource level and therefore limited energy generation, and profitability, potential.
“Instead, the future of offshore wind will see developers take the approach to energy production that saw oil and gas majors drive the industrial boom of the late 20th century.” Hatton concludes. “What location has the strongest resource? Where can it be most profitably produced? Are there added revenue streams that can be attached to the project? Yes, this will involve a degree of risk acceptance, but to generate the clean energy required to decarbonize the global energy system it will be critical to make strength of resource the top priority.”
The future for wind
As the climate crisis becomes more important in governmental agendas, we hope to see more innovative technology such as Wind-PV-Hybrids and floating wind come to fruition with a greater emphasis placed on social adoption of wind farm projects. To do so, we need to work with local communities, starting at school age, to educate and encourage everyone to understand the process of building a wind farm and its undeniable benefits. To overcome legislative barriers, all sectors need to adopt a more global approach with the aim to think global and act local. Only then we will see wind energy unfold its full, outstanding potential and play the role it deserves for the future of our planet.