where are we today in the offshore wind industry?...where we are today in the offshore wind industry...

2017 Wind Energy Systems Engineering Workshop

Where we are today in the Offshore Wind Industry

13/09/2017 Miriam Noonan

ore.catapult.org.uk@orecatapult

Agenda

• Brief Overview of ORE Catapult• Offshore Wind in Europe Overview• Cost Reduction - What we’ve seen so far• Cost Reduction - What do we expect to

see in the next 5 years?• Conclusion


ORE Catapult Overview


The catapult network:A long-term vision for innovation & growth

Catapults

• Established by InnovateUK• Designed to transform the

UK's capability for innovation • Core grant leveraged with

industry and other public funding 140 employees –strong collective experience

• >80 technical experts (research and engineering)

10


Testing and Demonstration Assets

Dual axis blade testing Bearing testing

Novel cables Real data for real simulations


Offshore Wind Overview


• Forecast European capacity to ~24GW by 2020 and 60GW by 2030• Includes 10GW in UK by 2020 and 20GW by 2030• Estimate average ~€6-7bn per year required

Offshore Wind Deployment in Europe

0

20

40

60

80

100

-

10

20

30

40

50

60

2015 2020 2025 2030

€ bn

GW

Estimate of Europe Offshore Wind Cumulative Installed Capacity and Investment

UK Other Investment


• Between 3 countries, up to 7,500MW available over 2 years of auctions

• Each country has different regulatory regimes In common – competitive bidding Key difference – UK and Germany currently competing sites;

Netherlands bidders compete for same pre-consented sites. Germany will be changing to a Dutch-style model for installation from

2026 onwards.

High-level European Context

Country 2017 (MW) 2018 (MW) Total (MW) Finance

Germany 1,490 1,550 3,100 €7bn

Netherlands 700 700 1,400 €3bn

UK 3,200 3,200 €8bn

Total 3,750 3,750 7,500 €18bn

Upcoming Auction Rounds – Potential capacity


Cost Reduction - What we’ve seen so far


Quantitative Results

Cost Reduction Monitoring Framework 2016-17

142121

97

- 20 40 60 80

100 120 140 160

FID 2010-2011 FID 2012-2014 FID 2015-2016

LCO

E (£

/MW

h)

FID Target (£/MWh):

• LCOE reduced 32% in 5 years• £100/MWh target achieved 4 years earlier than anticipated

http://crmfreport.com/


Qualitative Results

Cost Reduction Monitoring Framework 2016-17

• Nearly all indicators on or ahead of target

• All indicators medium or high confidence on outlook

http://crmfreport.com/

Inner rings: 2014/15Middle ring: 2016 scoreOuter ring: 2020 outlook

Inner and main ring:Ahead of targetOn targetBehind targetMissed target

Outer ring: High confidence Medium confidence Low confidence


Cost Reduction - What do we expect to see in the next 5 years?


Cost Reduction - UK Focus

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20

40

60

80

100

120

140

160

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023Leve

lised

Cos

t of E

nerg

y (£

/MW

h)

LCOE at FID

FID

2020 target £100

LCOE implied by CfD auction strike price ceilings


Competitive Bid Pricing

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20

40

60

80

100

120

140

160

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023Leve

lised

Cos

t of E

nerg

y (£

/MW

h)

LCOE at FID

FID

2020 target £100

LCOE implied by CfD auction strike price ceilings

~LCOE for €72.70

Borssele 1&2

~LCOE for €63.80

Vesterhav

~LCOE for €54.50

Borssele 3&4

~LCOE for €54.50

German Auction Round

2017

UK CfDAllocation, 2017


What’s driving this cost reduction?

• Increasing capacity factor• Larger turbines• Longer life assets

Technology

• Operating synergies • Optimising site locationsLocation

• Lower debt rates• Lower insurance premiums• Increasing market competition

Market Confidence


Competitive Bid Pricing


So what’s next?

Statoil, Hywind Scotland

JDR Export Cables

Enabling TechnologiesFloating Wind - Deepwater locations

- Simple installation and decommissioning

Larger export systems

- Further from shore- Higher capacity cables- Larger developments

Continued Cost ReductionEfficient Operations

- Improving O&M strategy- Higher capacity factors- Specialised vessels

GrowingMarket

- Established supply chain- Economies of scale


Thank You


BLYTHORE CatapultNational Renewable Energy CentreOffshore HouseAlbert StreetBlyth, NorthumberlandNE24 1LZ

T +44 (0)1670 359 555F +44 (0)1670 359 666

GLASGOWORE CatapultInovo121 George StreetGlasgowG1 1RD

T +44 (0)333 004 1400F +44 (0)333 004 1399

LEVENMOUTHORE CatapultFife Renewables Innovation Centre (FRIC)Ajax Way Leven KY8 3RS

T +44 (0)1670 359 555F +44 (0)1670 359 666

[email protected]

Contact us


Who we work with

Research Advisory GroupIndustry Advisory Group

SMEsPartnerships & strategic alliances

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where are we today in the offshore wind industry?...where we are today in the offshore wind industry...

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