A new report from a U.K. marine consultancy finds that the lack of near-term cost reductions in offshore wind could stunt the industry's further proliferation.
According to Intertek METOC, a short-term reduction in costs is unrealistic. With European offshore wind energy markets moving into deeper water, further offshore, short-term project development costs will rise. Moreover, in the medium term, cost reductions should be sought in areas such as standardization, installation, and operations and maintenance.
Intertek METOC says key to achieving these cost reductions is sharing and applying industry best practices with other key offshore energy markets. Industry-wide initiatives are already in place to help achieve cost savings of between 30% to 50% over the next 10 years.
Key areas of focus include standardization of equipment and procedures, streamlining contracts with risk-reward sharing and innovative partnering – particularly with cable installations, which is one of the main areas of cost overruns and insurance claims.
"The offshore wind industry is still learning, and any forced cost reductions may lead to an increased risk profile in the short term,’ says Frank Beiboer, managing director, in a statement. ‘Rather, by investing up front in different turbine technologies, installation methods and supporting infrastructure, operators and investors are more likely to achieve true long term cost reduction.’
Just the same, the consultancy insists that cost containment must be figured out by 2030 if the global offshore wind industry is to grow.