By Thomas Leurent
Over the last decade, the cost of wind energy has decreased by 70%. As impressive as that is, it has been outshined by a staggering 89% drop in the cost of solar. Solar is already the most successful renewable energy source from a cost perspective, and it will soon reach 20$/MWh.
There is a risk that wind will slip into solar’s shadow, but with costs tumbling down and recent reports from the IEA that coastal offshore wind generation alone has the ability to outstrip global demand, there is an opportunity for pioneering operators to make offshore wind powered energy every bit as effective.
The IEA predicts that by 2040 offshore wind will be the EU’s single biggest source of electricity, at an enormous 180GW. And according to Bloomberg NEF, cost efficiencies of solar and wind in a number of countries are set to see the price drop to below average wholesale market prices in a matter of months.
However it is simply unrealistic to expect the world to transition to low carbon sources unless the cost of newbuild renewables is lower than the marginal cost of existing fossil fuel power generation, like coal.
Now that capacity and price are finally getting into gear, it’s over to tech R&D to bring the price of newbuild renewables to the tipping point of the energy transition.
The future success of offshore wind relies entirely on a movement that will bring OEMs and operators together to function as parts of a holistic system. They need to function as a system – as well as introducing system engineering at scale. This kind of thinking will realise the savings required to bring offshore wind in line with solar’s performance.
The astounding advances in solar LCOE over the years have been driven by a Silicon Valley mind-set, where systems have been designed holistically. This is in part because there are many parallels between the development of solar and the development of computer chips, from a materials, performance and efficiency perspective. An example of this is the silicon wafer, which has been fundamental to the fabrication of integrated circuits and photovoltaics in solar cells.
Offshore wind hasn’t benefited from the rapid development pace seen in the micro-electronics sector; which has always functioned with interoperability at its core. By contrast, wind is still defined by a mechanical mind-set which means advancements are much more incremental. Components are designed in isolation which results in suboptimal systems, over-design and systemic conservatism – all barriers to offshore wind achieving the LCOE of solar PV.
When components are designed in isolation, the component-wide cost optimisation can have a tremendously negative effect on the overall system cost. Take the blades of a wind turbine for example; a cost-effective design process may result in a blade that weighs 29 tonnes – roughly the same as a humpback whale – but the knock-on effect to the rest of the system will be enormous. Over-dimensioning the drivetrain, nacelles and foundations – all in support of rotating three blades that together unnecessarily weigh as much as eight F35 fighter jets. The result? Inflated costs due to absolutely avoidable design inefficiencies.
The result of this mindset is a forecasted 65 GW contribution to the entire renewable electricity portfolio by 2024, compared to 1.2 TW from Solar PV.
We need to find a way to encourage sharing all the necessary information for system design throughout offshore wind developers and the supply chain, without compromising each stakeholder’s competitive advantage. Cross-industry system design has the ability to achieve absolute efficiency across the sector, and in turn a much lower price point.
As a digital technology developer at the frontline of offshore wind innovation, I’m a passionate believer that system engineering and digital technologies are the keys to exponential rather than linear technology growth. However, asking an entire sector to overhaul the habits of a lifetime is no simple task. Realistically, the only way to get everyone to play ball is to align incentives throughout the supply chain.
As Governments around the world declare climate emergencies and world leaders accept that the point of no return is sadly behind us, there is no more room for manoeuvre. Technology is the silver bullet that has the power to ensure wind energy makes commercial – as well as environmental – sense. It’s time for us all to become pioneers once again, and help wind to power the world.