Governments need to kick-start commercial-scale projects to help drive down the levelised cost of energy (LCOE) from floating wind, according to industry leaders speaking at the Reuters Events: Offshore & Floating Wind conference
Larger turbines, better wind speeds and higher capacity factors will all play a part in reducing costs, but floating wind energy needs more sites for commercial-scale projects if parity with bottom-fixed wind is to be achieved, according to speakers at the event. But despite a dearth of commercial sites, it could achieve the same LCOE as bottom-fixed offshore wind sooner than expected, according to one panellist.
Mainstream Renewable Power executive chairman Eddie O’Connor was the most bullish of the participants in a panel discussion about floating wind and cost reduction. “I think it will happen sooner than people think,” Mr O’Connor said of the timelines for cost parity between bottom-fixed and floating wind.
Mr O’Connor based his assertion on the higher capacity factors for floating wind, greater wind speeds and the potential of larger turbines: “With the size of the turbines, higher wind speeds, I think (cost parity) will come fairly quickly.” But Mr O’Connor cautioned that turbines and foundations are only part of the equation, and grid connection could be costly.
In contrast, Cierco managing director Mikael Jakobsson said he did not expect the cost of floating wind to be comparable with bottom-fixed offshore wind before the end of the decade. Ocean Winds chief operating officer Grzegorz Gorski said that it was dangerous to compare bottom-fixed and floating project costs without taking many factors into account, including, most importantly, the size of such projects.
“We don’t need another decade of demonstration projects; commercial-scale projects with big turbines are needed to make floating wind competitive”
“We should not forget that LCOE is related to volume and scale. We know that if you double the size of a bottom-fixed windfarm, LCOE comes down by around 10%,” Mr Gorski said. That will also be the case for floating wind, he said, but early floating wind projects are unlikely to be anything like the size of some of the largest – and lowest cost – bottom-fixed projects to have been awarded.
Flotation Energy chairman Lord Nicol Stephen told delegates that floating wind energy has a tremendous future ahead of it, but will need support in its initial stages of development, no matter the scale of early projects. He agreed with his fellow speakers that the larger the scale of floating wind projects, the faster LCOE will fall.
All of the speakers agreed that governments are not promoting enough sites for commercial-scale floating wind, and that this needs to change. Session chairman BVG Associates associate director Mike Blanche said there are good sites in the first ScotWind Leasing round, but said it could be a challenge to bring power ashore from some of them.
Mr O’Connor noted that “money needs to be spent” to ensure more sites become available, given the hugely important role that offshore wind is set to play in the energy mix in Europe and in long-term decarbonisation plans. He said the policy framework that would allow decarbonisation to be achieved and floating wind to play a role in decarbonisation “is nowhere near good enough.”
Lord Nichol said: “We don’t need another decade of tests and demonstration projects.” With that kind of approach, he said, “we won’t gain the momentum and anything like the scale required to drive down costs.
“We need scale to make the technology credible worldwide,” he told delegates. “We have got beyond demos. Commercial-scale projects with big turbines is what is needed to make floating wind competitive.”
Mr Gorski highlighted the fact that in South Korea, offshore Ulsan, very large floating wind projects are being planned.
As highlighted by OWJ, in September 2020, Macquarie’s Green Investment Group (GIG) and global energy company Total signed a series of agreements to co-develop an initial 2.3 GW of floating offshore wind projects in South Korea. This includes a portfolio of five projects, three in Ulsan totalling 1.5 GW and two in South Jeolla Province totalling 800 MW.
In late 2019, WindPower Korea, EDP Renewables (now part of the Ocean Winds joint venture with Engie) and Aker Solutions formed a consortium to develop a 500-MW floating windfarm off the coast of Ulsan City in South Korea.