Cutting the cost of offshore wind

The U.K. has just taken the lead in offshore wind generation, and a new coalition formed to look at reducing the costs of the power projects could help keep the country ahead of the pack.

The Carbon Trust, an independent company set up and funded by the U.K. government, announced that it has teamed up with five European energy companies on an initiative called the Offshore Wind Accelerator. The initiative is aiming to cut the costs of offshore wind energy by 10 percent or more through a combination of wind farm cost reductions and performance improvements.

The Carbon Trust, which is putting up £10 million in funding for the project, said the initiative is worth up to £30 million over the next five years. The rest of the cash will come from Denmark's Dong Energy, Ireland-based Airtricity, Germany's RWE Innogy, Scotland's ScottishPower Renewables, and StatoilHydro in Norway.

The Carbon Trust's Mike Hay, project manager of the Offshore Wind Accelerator, told the Cleantech Group that costs are already on the rise.

"The developers who are putting their hands in their pockets to pay for projects are feeling the pinch of rising costs right now, today.

The Carbon Trust said pricetags for offshore wind farms have more than doubled over the last five years. The initial phase of the Offshore Wind Accelerator will involve a set of detailed feasibility studies, with tenders for companies to work on the studies expected to go out later this year.

The initiative, which is looking at coming up with solutions to cut costs in the short to medium term, expects large-scale demonstration projects to start in 2010.

"We'd like to see an output," said Hay. "These projects actually impacting on the overall sector."

The project plans to looks at areas in wind farm design, construction and operation, including offshore foundations; wake effects; access, logistics and transportation; and electrical systems. The group hopes to see the technologies demonstrated in the water in the next few years.

"Although the companies and the partners we'll be working with will be learning the whole time, which is the whole benefit, the whole purpose of the Offshore Wind Accelerator, the actual demonstration of the kit, for instance the foundations in the sea, in real sea conditions, we'd like to see that, like I said, in four to five years," said Hay.

All of the companies in the initiative have a stake in U.K. wind development, with Dong Energy holding 50 percent of the London Array, which willl likely to be the world's largest offshore wind project when it's built. The planned 1,000 megawatt wind farm recently gained a new investor when Abu Dhabi's Masdar Initiative bought 20 percent of the giant offshore project from Germany's E.ON (see Masdar takes stake in London Array).

Airtricity is working with Texas-based Fluor to develop a 504 MW offshore wind farm, called Greater Gabbard, off the Suffolk coast of England.

RWE Innogy, which already has a project off the coast of Wales generating electricty, is looking at three more sites in the U.K., which would bring its combined capacity in the country to about 2 gigawatts.

ScottishPower Renewables, the U.K.'s largest onshore windfarm developer, recently received consent for its first offshore project in partnership with Dong and Tokyo's Eurus Energy. ScottishPower also recently announced plans for a big development in tidal power (see Marine power heats up in Scotland).

Rounding out the group, StatoilHydro holds a 50 percent stake in the 315 MW Sheringham Shoal project being developed off the coast of Norfolk in east England. The other owners are U.K. wind technology company SLP Energy and Dutch energy development group Ecoventures.

Once the technologies from the Offshore Wind Accelerator are ready to go in the water, Hay said the project is open to working with companies that aren't already a part of the offshore wind industry.

"We might not necessarily be contracting with the standard companies that are involved in offshore wind today," he said. "What we'd probably quite like to do is to open that up to companies that are maybe not involved just now."

"Essentially open up the supply chain."

Last week, the Carbon Trust published a report on the hurdles in developing offshore wind power in the U.K., saying that offshore wind has the greatest potential of all renewable energy technologies to deliver the U.K.'s target to get 15 percent of its energy from renewables by 2020. But the Carbon Trust said the government needs to relax the constraints that dictate where offshore wind farms can be built if it wants to meet that target.

At this week's British Wind Energy Association conference, Prime Minister Gordon Brown said the U.K. had overtaken Denmark to become the world's No. 1 for wind farms built offshore, with 597 MW fully constructed.

The government said offshore wind farms now have the potential to power the equivalent of 300,000 homes. Brown said the U.K. now gets 3 GW of electricity from wind power overall.

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