In 2019, the International Energy Agency described offshore wind’s potential as ‘near limitless.’ The World Bank said it can transform global energy plans, contribute to sustainable development goals and help meet commitments made under the Paris Agreement. 2020 will see work start on realising these long-term goals, but big goals bring with them big challenges.
Fortunately, for an industry facing challenges as well as opportunity, offshore wind has garnered political support around the world; new technology that will be needed is there, or in development; and financiers are delighted to back it. But the massive scale now envisaged for offshore wind means work needs to start in earnest to minimise potential conflict with other users of the sea.
Politicians around the world swung firmly behind offshore wind in 2019 and more will do so in 2020. Many have vowed to boost existing targets for offshore wind capacity. In the UK, returning Prime Minister Boris Johnson has promised 40 GW of offshore wind by 2030 and that floating wind projects will be developed. In the US, Presidential candidate Senator Elizabeth Warren has placed offshore wind at the heart of plans for a ‘Blue New Deal.’ In France, the government’s decision to double its target for offshore wind to 1 GW per year has reinvigorated the industry.
But it is at the European level that the most important political support for offshore wind has emerged, with the European Commission’s newly-published European Green Deal highlighting the ‘essential’ role of offshore wind after it set a goal of up to 450 GW by 2050. 2020 will see the EU publish a dedicated offshore wind strategy that will have a lot to say about how the sector gets to 450 GW.
If Europe really is one day to achieve 450 GW of offshore wind, agreements are going to need to be reached with a lot of existing users of the sea and some new ones. The concept of marine spatial planning will receive more attention in 2020 and subsequent years. Even those objecting to offshore wind projects for environmental reasons – whether they be fishermen or conservation groups – generally agree that the world needs green energy. In 2020, a much higher level of communication with other stakeholders will be essential.
But such is the massive scale of offshore wind plans that conflicts will still arise. In the US, Vineyard Wind, the first commercial-scale project, is held up by a programmatic review of offshore wind by the Bureau of Ocean Energy Management. Several projects due to have secured planning permission in the UK have been delayed. Much larger scale will bring with it more such issues. In 2020, attention also needs to focus on ways to keep airspace safe and work with the military while building large numbers of industrial-scale projects.
The scale of offshore wind will continue to increase in 2020. 2019 saw important milestones in the development of larger turbines. The prototype of GE Renewable Energy’s Haliade-X 12 MW started turning in Rotterdam; Siemens Gamesa Renewable Energy expanded its product portfolio with the launch of the ‘DD Flex’ concept and the 11-MW SG 11.0-193 DD Flex offshore wind turbine. Close competitor MHI Vestas Offshore Wind already has a 10-MW turbine and developers – who know better than anyone what OEMs have up their sleeves – are already talking about using 14-MW turbines on upcoming projects. Companies such as GreenSpur Renewables are developing new technology and are talking about turbines of 20 MW or more.
2020 will see more revelations about larger turbines and will also see larger and larger projects being discussed. Equinor’s 3.6-GW Dogger Bank offshore wind project – for which it was awarded contracts for difference in the UK’s Third Allocation Round (Round 3) – will be the energy company’s largest project in 2019-2026 and ranks as the sixth-largest offshore development project of any type in the world in the same period. In Denmark, the government has begun consulting about sites for 10-GW energy islands, and cross-border projects are being discussed by several countries.
In my preview of 2019, I suggested that offshore wind’s potential as a source of clean hydrogen would be recognised. It has been, but 2020 will also be a big year for power-to-gas. The North Sea Wind Power Hub believes some windfarms could turn all of the power they produce into hydrogen. RWE and innogy are examining production of green hydrogen in the province of Groningen, the Netherlands. The Offshore Wind Industry Council in the UK has started work on a project that will look at using electricity from offshore wind to generate green hydrogen, and in September 2019, Ørsted, ITM Power and Element Energy won funding from the UK Government for a green hydrogen project that will focus on low-cost, zero-carbon hydrogen.
There are a fast-growing number of demonstration projects looking at offshore wind and green hydrogen. Germany’s Westküste 100 project could see green hydrogen being produced from offshore wind by 2030, but in 2020 look out for much larger, international projects on green hydrogen and offshore wind, a commitment to a commercial-scale project and an important role for hydrogen in the EU’s offshore wind strategy.
2020 will also see important developments in floating wind. It is also likely to feature heavily in the EU strategy for offshore wind. That could result in greater funding for R&D and more demonstration projects, but what floating wind most needs in 2020 is a commitment from a government to support commercial-scale projects. If the Johnson administration in the UK is serious about support for floating wind, it should use the contract for difference auction framework to create a pot of money for floating wind that will put it on a glide path to cost-competitiveness and major export opportunities. Industry in countries such as Norway will hope that 2020 will see intermittent statements about potential diversification from oil and gas to floating wind followed up by policies that support market access.