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Offshore Wind Journal

Offshore wind industry ‘can reduce costs to below €80/MWh’

Mon 06 Jun 2016 by David Foxwell

Offshore wind industry ‘can reduce costs to below €80/MWh’
Leading players in the offshore wind industry say significant cost reductions can be achieved

Ahead of the Energy Council on 6 June, 11 leading energy companies have issued a statement underlining the crucial role that offshore wind can play in the European energy system and the commitment the wind energy industry is making to reduce costs.

In the statement, the companies say: “With the right build out and regulatory framework the industry is confident that it can achieve cost levels below €80/MWh for projects reaching final investment decision in 2025, including the costs of connecting to the grid. This means offshore wind will be fully competitive with new conventional power generation within a decade. The offshore wind industry is on track to achieve its cost reduction ambitions and will be an essential technology in Europe’s energy security and decarbonisation objectives.

“As an industry, the joint and individual actions taken across the value chain will deliver lasting and tangible advancements that will establish offshore wind as an indispensable source of power generation. We recognise our responsibility to deliver industry and consumers with sustainable, secure and affordable energy. We look to policymakers to match this level of ambition.

“This commitment is only possible with a stable, long-term market for renewables in Europe. If the offshore industry is to realise its cost reduction goals, a strong pipeline of projects is needed to scale up offshore deployment and identify efficiencies in the supply chain. Following a record year for installations in 2015, a serious question mark remains over the post-2020 environment for offshore wind. Policymakers at European and national level must set out clear visions for the industry after 2020 with robust laws that give investors peace of mind and visibility well into the future.

“In addition to stable regulation, regional co-operation on offshore wind between European countries is of vital importance, particularly in the northern seas. Closer regional co-operation, on planning, financial and regulatory issues, would help to reduce costs and remove barriers to investment.

“We understand that 10 countries in the northern seas are preparing to sign a memorandum of understanding and work programme on regional co-operation on 6 June at the Energy Council in Luxembourg. We congratulate this political will and commitment to action from the Energy Ministers concerned and the Netherlands for the leadership they have shown on this under their Presidency of the EU Council.

“Renewables such as offshore wind are steadily displacing conventional forms of power generation. As costs come down rapidly, the wind industry continues to meet its commitments. We now urge Europe’s governments to work together to ensure offshore wind can be central to the continent’s energy mix in the years to come.”

The statement was signed by: Luis Alvarez Rubio, general manager Adwen; Jeroen de Haas chief executive officer, Eneco Energie; Anders Søe-Jensen, president & chief executive officer Offshore Wind GE Renewable Energy; Jens Tommerup, chief executive officer MHI Vestas Offshore Wind; João Paulo Costeira, chief operating officer Europe & Brazil EDP Renewables; Michael Lewis, chief executing officer, E.ON Climate & Renewables; Xabier Viteri Solaun, chief executive officer Iberdrola Renovables; Hans Bünting, chief operating officer Renewables, RWE Innogy; Michael Hannibal, chief executive officer Offshore Wind, Siemens Wind Power; Gunnar Groebler, senior vice president Business Area Wind, Vattenfall; Halfdan Brustad, vice president Renewables Offshore Wind, Statoil. Dong Energy said the IPO on which it has recently embarked means that it is restricted from making certain public statements until after completion of the offering so could not sign the statement, but remains “fully committed to continue to reduce the cost of electricity in line with the rest of the industry.”

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