TODAY’S STUDY: THE HUGE OPPORTUNITY IN OFFSHORE WIND O&M

A Guide to UK Offshore Wind Operations and Maintenance

July 2013 (GL Garrard Hassan for Scottish Enterprise and The Crown Estate)

Executive Summary

The focus of the fledgling UK offshore wind industry has so far been the development and construction of wind farms in the unforgiving marine environment. But, as more and more offshore assets are commissioned and the number of operational wind turbines continues to grow, the technical and commercial challenges of operating projects is starting to receive much greater attention.

Offshore wind operations and maintenance (O&M) is a rapidly developing sector in its own right. Standardised technical and commercial practices have not yet emerged. Accepting that there are many paths offshore wind O&M can take, this ‘Guide to UK Offshore Wind Operations and Maintenance’ sets out the fundamental drivers that will shape the industry – and sheds light on the scale and nature of the opportunities it presents.

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Further From Shore

As more and larger offshore wind projects are built, further from shore, accessing the turbines to carry out maintenance will require new logistical solutions.

As well as the relatively well understood workboat-based approach, increasing transit distances mean that strategies which include helicopter support and, eventually, offshore-based working will be needed.

The Opportunity

O&M activity accounts for approximately one quarter of the life-time cost of an offshore wind farm. Over the next two decades, offshore wind O&M is going to become a significant industrial sector in its own right.

Based on the UK Government’s projections for the deployment of offshore wind, the O&M of more than 5,500 offshore turbines could be worth almost £2bn per annum by 2025 – an industry similar in size to the UK passenger aircraft service business today.

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The Players

The main customers for O&M services are the owners of the wind project, the supplier of the wind turbines and the owner of the electricity transmission connection. The precise contracting arrangements depend on several factors, not least the project owners’ appetite for taking a “hands-on” role and the capabilities available in the third-party market. Many areas of offshore O&M will present opportunities for small and medium sized enterprises (SMEs) – particularly those where location, flexibility and new ideas are important.

All To Play For

As this industry looks at the challenges ahead and strives for commercial maturity, it is those companies who actively engage now that will help to shape its future.

Introduction

Offshore wind O&M is the activity that follows commissioning to ensure the safe and economic running of the project. The objective of this activity is to make sure the project achieves the best balance between running cost and electricity output. O&M occurs throughout the life of the project, which is nominally 20 years. In this industry, O&M is broadly similar to inspection, repairs and maintenance (IRM) activity in the offshore oil and gas sector.

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As implied in the name, O&M comprises two distinct streams of activity.

• Operations refers to activities contributing to the high level management of the asset such as remote monitoring, environmental monitoring, electricity sales, marketing, administration and other back office tasks. Operations represent a very small proportion of O&M expenditure, the vast majority of which is accounted for directly by the wind farm owner or the supplier of the wind turbines.

• Maintenance accounts for by far the largest portion of O&M effort, cost and risk. Maintenance activity is the up-keep and repair of the physical plant and systems. It can be divided into preventative maintenance and corrective maintenance.

• Preventative maintenance includes proactive repair to, or replacement of, known wear components based on routine inspections or information from condition monitoring systems. It also includes routine surveys and inspections.

• Corrective maintenance includes the reactive repair or replacement of failed or damaged components. It may also be performed batch-wise when serial defects or other problems that affect a large number of wind turbines need to be corrected. For planning purposes, the distinction is usually made between scheduled or proactive maintenance and unscheduled or reactive maintenance.

After the paramount safety of personnel, the second most important consideration when operating and maintaining an offshore wind project is the financial return. The objective of maximising the output of valuable electricity for sale – at least cost – can be thought of as driving all decisions by project owners about planning and carrying out O&M.

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Key concepts

Offshore wind O&M involves a diverse range of activities. However, there are a few fundamental concepts that underpin the way that the key players are likely to approach O&M. Some of the most important factors in shaping O&M are:

• Availability – as a measure of the performance of the asset

• scheduled and unscheduled maintenance – the nuts and bolts of keeping a project running smoothly

• Access – overcoming the constraints placed on operations by the weather and sea conditions

• Cost reduction – a continuing focus for the industry as a whole

These concepts are explained in the following sections.

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Availability

The economics of offshore wind O&M require a balance to be struck between the money spent on maintaining the project and the revenue lost when the electricity output is limited by technical problems.

An important measure of the performance of a project is known as availability. Availability is the proportion of the time that a turbine, or the wind farm as a whole, is technically capable of producing electricity. Availability is therefore a measure of how little electricity is lost due to equipment downtime. The balance between O&M cost and the lost revenue incurred by non-availability will be different for every project, but current offshore wind farms typically achieve availability of between 90% and 95%.

Onshore wind farms, which face much lower O&M costs, typically achieve higher availability in the order of 97%. Figure 2.1 shows indicative trends for the cost of O&M as a function of turbine availability. Although the cost of lost revenue declines towards zero as the turbines approach 100% availability, the cost of achieving it approaches exponential growth if 100% availability is required. If a wind farm owner invests too little in O&M, they will incur a penalty in the form of poor performance of the turbines and other components. Conversely, if an owner overinvests in O&M, with no regard to cost, they face diminishing returns as each increment in availability costs more than the last. The chart shows this theoretical optimum at the lowest point of the total cost curve, which of course will be slightly different for each project.

Availability is a technical metric and not directly related to the wind resource. For this reason it is important that it is not confused with capacity factor which, while also expressed as a percentage, is strongly a measure of the output of the project and, as such, is influenced by the average wind speed at the site.

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Access

One of the major hurdles to maintaining offshore wind projects is getting technicians on and off the turbines and offshore substations to carry out work. There are two major factors that influence the approach taken to gaining access:

• Transit time – the time needed to shuttle a service crew from the O&M base to the place of work. With limited shift hours available, the time taken to transport crews to and from a maintenance job cuts into the amount of time actually working to maintain the turbines and other plant. The further the project site is from the O&M base, the less time can be spent by crews on active work, given the longer transit time and risk of fatigue.

• Accessibility – the proportion of the time a turbine can be safely accessed from a particular vessel and is dependent on the sea conditions. For example if, at a particular project, the significant wave height1is greater than 2m for 40% of the time, a vessel that can transfer crew and equipment only in wave heights of 2m or less might be said to have 60% accessibility.

Both of these factors depend, to some extent, on the average sea conditions in a particular location – accessibility more so than transit time. Accessibility is especially critical for unscheduled maintenance since the project operator will often have no opportunity to plan any production outages for times of calmer sea conditions. When planning the approach to O&M for any given project, the owner will seek to reduce the total cost (direct cost and lost production) by seeking ways to reduce transit time and increase accessibility to the turbines.

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Scheduled and Unscheduled Maintenance

Much of the maintenance activity is currently carried out on an ad-hoc, responsive basis when a wind turbine or other system fails. This is referred to as unscheduled maintenance. Such faults will require a range of different responses from a simple inspection and restart of a wind turbine, which might take a couple of hours, through to the replacement of an offshore substation transformer, which could take weeks or months to implement.

Other activities can be planned and executed in advance – scheduled maintenance. Typically, offshore wind turbines and associated plant have a defined scheduled maintenance regime which involves a major annual service supplemented by periodic inspection regimes. The annual services are usually conducted in the summer months to minimise weather downtime and lost production since average wind speeds tend to be lower in summer than in winter and may be carried out by a temporary, supplementary team of specialist staff and providers.

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Cost reduction

Reducing the cost of the energy produced by offshore wind projects is a major focus for the offshore wind industry and for the UK Government. As a significant contributor to the overall cost of energy, finding ways to reduce the cost of O&M services and optimising asset performance have important roles to play.

As described under “availability” above, the incentives on the owner of the project to maximise the electricity production at least cost are very compelling and can be expected to drive improvements in all technical elements of O&M as the market gathers momentum. Particular technical developments expected to come forward include future wind turbine models with increased focus on:

• Improved remote monitoring and control to better understand the offshore plant and make previously unscheduled activities more predictable, reducing the logistical burden of putting technicians on turbines.

• Design and manufacturing improvements aimed at boosting reliability, thereby reducing the frequency and cost of unscheduled maintenance.

• Other, more fundamental, improvements such as the development of more reliable, gearless (direct drive) turbines.

Non-technical areas for cost reduction, although uncertain, may include greater synergies, sharing of resources such as jack-up vessels or other logistics plant between neighbouring projects and greater competition within the O&M supply chain for a range of contract packages.‘Perfect’ O&M maximises availability, at least cost, by ensuring the best possible access to offshore plant, minimising unscheduled maintenance and carrying out scheduled maintenance as efficiently as possible – ultimately resulting in the lowest possible cost of energy…

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