As a new technology Offshore Wind development costs are high. To become a viable global source of electricity production, these costs must come down. A new report published by the German Offshore Wind Energy Foundation addresses the issue head on.
The headline grabbing conclusion is that with consistent development the cost of electricity from offshore wind can be reduced by a third over the next ten years.
The report focused on the German market (which currently has an installed capacity of just over 3GW) and considered two scales of development:
1. A German market build out to 9GW installed capacity by 2023 which resulted in a cost reduction of 31%
2. A German market build out to 14GW installed capacity by 2023 which resulted in a cost reduction of 39%
The report was presented at an event in Berlin on Aug 22. Great emphasis was given to the need for a stable market framework for these advances to be realized. At the presentation Jens Eckhoff, President of the Foundation said “Offshore wind power has a substantial cost reduction potential. However, the industry can only exploit this potential if there are reliable framework conditions to achieve significant market volumes.”
There are a lot of people in Europe, the US, and elsewhere around the world who will argue that all of this R&D is a huge waste of time, that it is anti-capitalistic for government to provide long term subsidy and assurance for renewable energy markets (often overlooking that traditional energy markets are some of the largest beneficiaries of such benefits), and that the way to meet our future electricity production demand is to lift restrictions on drilling and mining and to ensure that few restrictions are placed on Natural Gas exploration.
I don’t consider myself anti-fossil fuel but like replacing the old copper telephone network with fiber; we need other options. Pragmatically, carefully and methodically developing new and innovative technologies which will with the passing of time, inevitably become part of our future is what has made us strong in the past, and it will do so again.
When I remember the history of the energy industry in Europe, the US and elsewhere, it is the century of Government-Industry partnership, for both good and bad, which provided the bedrock for development and growth.
When I look forward and contrast the innovative potential of technology such as offshore wind with hard climate science such as this latest report on ocean acidification or this other new report on sea level rise - the same Government-Industry partnership model, working together by investing in emerging technology and adapting to real change, seems both necessary and inevitable.