Wind at sea becomes increasingly important in European energy transition
With increasing speed, European countries are focussing on the transition from fossil energy to renewable energy. Wind at sea seems to play a leading role in this transition. This applies in particular to the Netherlands: In the country’s territorial waters five new wind farms will raise that will belong to the largest in the world. The main reason that wind at sea has such good cards: less and less government subsidies are necessary to develop wind farms.
Nowadays, the Dutch government is fully committed to wind energy. At the moment, five new wind farms are being developed, each with a capacity of a whopping 700 megawatts. To give an idea: Every single farm can provide at least one million households with electricity. In the Energy Agenda presented by the former government last year, another seven wind farms at sea are planned, each with a capacity of 1000 megawatts.
Wind energy is "green", but in terms of cost price it cannot compete with fossil energy yet. For example, the operator of the Gemini wind farm north of the island Schiermonnikoog receives a minimum price of 19.6 cents for each kilowatt-hour (kWh) sold. This means that the market price, which is now slightly below the 4 cents, is supplemented by subsidy to 19.6 cents.
However, we are now approaching the end of the subsidy era. The first sign of this new trend was seen last year in the tenders for the first two Borssele wind farms near the coast of Zeeland. These were won by the Danish energy company Dong, with 25 percent market share a global leader, who put a bid of 7.27 cents subsidy per kWh produced. The market was flabbergasted: lower was not possible. Only a few months later, a consortium from Shell, Eneco and Van Oord broke a new record. They won the tender for the other two Borssele wind farms for a price of 5.45 cents subsidy per kWH.
Recently, it was announced that Dong also won tenders for the construction of two newly planned wind farms in Germany (OWP West and Borkum Riffgrund West 2) because the energy company no longer required any subsidy at all. Main reason: ever-bigger turbines are being developed. The Gemini Park, mentioned above, contains turbines with a power of 4 megawatts (MW). A turbine of 9 MW is currently being tested and Dong assumes that by 2024, turbines of at least 13 MW will be on the market. Bottomline: more power can be produced with less turbines, for a better price .
Once wind energy is "self-sufficient", this will also affect other technologies that generate green energy, such as solar and tidal energy. These technologies also are expected to be less costly in time: After all, subsidies will be granted less quickly if alternative energy can be generated with wind farms that do not need any subsidy at all.
Fact is, the dizzying price developments on the sea wind farm market are excellent news for service providers like Oceanteam Solutions. Never before, the prospects in the wind energy industry have been so promising and never before there were so many projects in the pipeline. Because for every new park, foundations must be constructed and cables must be laid to transport the generated electricity to the mainland. A challenging perspective, on the eve of the final breakthrough of wind energy at sea.