OFFSHORE WIND OPPORTUNITIES AND COSTS RISING

Offshore wind needs to cut costs for growth – IHS market study; Developments move into deeper waters further offshore

13 June 2012 (IHS Emerging Energy Research)

“The offshore wind industry is growing fast but faces major challenges in delivering large scale projects while at the same time cutting costs as developers look for new sites in deeper waters further offshore, according to Global Offshore Wind Energy Markets and Strategies: 2012 – 2025 from IHS Emerging Energy Research…The sector faces a ‘make or break’ window until around 2016 when it needs to cut costs or it could face a rapid decline as a non-competitive technology…”

“Most projects are built at the moment within a relative ‘comfort zone’ of up to 30 metres in depth and at 30 kilometres distance from the shore…[The challenge will be] to increase capacity additions at lowered costs…Costs remain high at the moment and financial backing for capital-intensive projects is needed…Costs have risen in recent years, driven by competition to secure turbines and the development of more technically complex projects, as sites near the coast or in shallow water get developed…”

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“…IHS forecasts that global offshore wind investment, including transmission, is set to climb nine-fold between 2011 and 2025, rising from US$6 billion to US$52 billion…The global offshore market is expected to reach nearly 95 gigawatts of installed wind energy capacity by 2025, compared with 4.2 GW at present, which accounts for just two percent of wind energy worldwide…

“Europe will continue to lead…with the U.K. and Germany both installing more capacity than China…China leads the offshore charge in Asia, with more than 300 MW of installed capacity as well as aggressive targets and large projects in the pipeline.”

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