Rising costs and supply chain bottlenecks have hit the nascent floating offshore wind farm industry worldwide, according to Reuters.
“If the next decade is to see the adoption of floating offshore wind, and its growth into a leading market, the work that we do in 2023 will dictate just how successful this is,” said Felipe Cornago, commercial director offshore wind at BayWa, which is developing a wind farm off Scotland.
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About 80% of the world’s offshore wind power potential lies in waters deeper than 60m, according to the Global Wind Energy Council (GWEC), meaning floating turbines will be vital for some countries with little space left on land and steep coastal shelves to decarbonise their power sectors.
Winds are stronger and more continuous further out to sea so floating turbines can generate more power than those fixed to the seabed near to shore—and they less visible from the coast, reducing the risk of resistance from local communities.
By the end of 2022, plans for about 48GW of floating wind capacity around the world were in place, nearly double the amount in the first quarter last year, according to Fitch Solutions, with European companies driving the expansion.
Consultancy DNV forecasts that about 300GW will be installed by 2050, representing 15% of all offshore wind capacity, but wind turbine makers are already struggling to meet rising demand due to rising inflation and raw material costs.
The largest project to date, the 88MW Hywind Tampen project being developed off Norway by oil and gas company Equinor was meant to be fully commissioned in 2022 but delays due to some steel parts not being of sufficient quality for four of the towers has pushed the start to later this year.
Last year, oil company Shell and state-owned Chinese energy company CGN dropped a plan for a floating wind project off France’s Brittany coast, citing inflation and supply chain problems among other reasons.
GWEC said supply bottlenecks for turbines and components could continue or even be compounded by incentives in the United States for low-carbon energy deployment, as well as increased demand in China, Europe and emerging markets.
As most commercial-scale floating wind farms are only expected to be up and running from 2030, there could be time for such problems to be resolved, said Francesco Cacciabue, partner and CFO at renewable energy investor Glennmont Partners.
At the moment, technology costs for floating wind are far higher than for fixed turbines but companies hope to reduce those costs sharply as larger projects come on stream.
According to DNV, the average levelised cost of energy (LCOE)—which compares the total lifetime cost of building and running a power plant to its lifetime output—for floating wind was about 250 euros per megawatt hour (MWh) in 2020, compared with around 50 euros/MWh for fixed turbines.
But by 2035, the LCOE for floating wind is expected to fall to about 60 euros/MWh.
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“For floating, the expectation is that it will sell power at a higher price than fixed-foundation offshore wind for several years while it industrialises and gets to a point where it can compete on a like-for-like basis,” said Jonathan Cole, chief executive of Corio Generation, part of Macquarie’s Green Investment Group.
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