By Tom Quinn, Analysis and Insights Manager for Offshore Renewable Energy (ORE) Catapult.
At the start of 2020 I took a walk around the office to ask our experts about what they predicted for the year ahead. In the December episode of the Re-Energise podcast, we looked back on the year and as it turned out, we were close to the mark for most of our predictions – read them here.
With the effects of the pandemic spilling into the new year, it may be a quieter 2021 than many hoped. However, it will be a pivotal year looking ahead. The COP26 conference is front of mind both globally and for us in Glasgow, with revisions to the Paris Agreement likely required to keep warming below 1.5°C.
2020 was almost a watershed year with huge focus on green recoveries and energy transition. A substantial amount of talking, thinking and writing has been done on these topics. Overall, 2021 should be the year where governments, industries and individuals mobilise and make meaningful headway on high-impact initiatives, as well as pushing harder with existing plans, which will eventually make all the good intentions a reality.
With the US re-joining the Paris agreement, and the Democrats in control of the House and Senate, we will quickly see some more progressive energy policy enacted and we may see some real momentum with offshore wind. The US offshore wind sector has stalled since the 30MW Block Island project came online in 2016. The lack of clear, centralised policy and federal support has meant states have had to take the lead but have not been able to secure federal permits and advance developments. Supply chain has been slow to develop, and the Jones Act has made it challenging to source vessels for installation and maintenance of large wind farms. With roadblocks removed, the US can start to build its 30GW pipeline of projects, and we’d expect to see a development like Vineyard Wind (800MW) take final investment decision.
Closer to home, the ScotWind leasing round is set to close for applications in March. We expect to see all projects awarded by the end of the year totalling 10GW of new capacity, with several projects using floating substructures. The rest of the UK will have to wait a little longer, with the 7 to 8.5 GW of seabed rights for new capacity in the Offshore Wind Leasing Round 4 unlikely to be awarded until 2022. Decisions on specific revenue support for tidal stream could be make-or-break for the nascent technology in the short term. In addition to all the offshore wind activity, Allocation Round 4 may well also include a minima (ringfenced capacity) for marine power, as opposed to being purely technology-neutral.
Floating wind ambitions are for at least 1GW installed in the UK by 2030, however we are unlikely to see major announcements this year as surveys and supply chain planning take centre stage. That being said, in the latest report from the Floating Offshore Wind Centre of Excellence – Floating Offshore Wind: Cost Reduction Pathways to Subsidy Free – suggests the UK Government should be more ambitious with its floating wind targets, doubling it to 2GW by 2030.
The Celtic Sea could get a boost from development work of the 96MW Erebus project. You can find out more about the opportunities for floating offshore wind in the Celtic Sea in the Benefits of Floating Offshore Wind to Wales and the South West Supply Chain Report. ScotWind will also result in leases being awarded for floating and fixed/floating hybrid projects. A wildcard would be an oil & gas operator making real moves towards powering offshore facilities with floating wind in the UK. Total and Shell are already active in the floating wind space, with the Blue Gem Wind and TetraSpar projects respectively. Equinor is busy awarding contracts for the 88MW Hywind Tampen project ahead of commissioning late next year.
All these developments will require a ramp up of grid infrastructure. The Offshore Transmission Owner (OFTO) Regime is under review, which could allow a more coordinated approach to transmission networks rather than systems for individual wind farms. Interconnectors will also play a role. Energy islands in the North Sea may be several years away, but development starting this year would open the door to better connected, greener international grids. Hydrogen continues to be a hot topic – will we see a large-scale electrolyser system integrated into offshore wind development plans this year? In parallel, technology testing of offshore hydrogen systems will continue to ramp up on the road to a commercial project being sanctioned.
New capacity additions will also require the renewable energy supply chain to expand. The UK Government pledged £160 million of state support for upgrades to ports at the end of 2020. This could spark the sanctioning of new sites across the UK for tower, monopile and blade manufacturing. Large private sector investment will also be required for the country to meet Sector Deal ambitions for local content and export success. Meanwhile, we may see a structured programme for skills transitions for people looking to move from oil & gas and other industries into renewable energy.
Technological innovation will continue at pace, with the general trend for bigger and better components continuing. Turbine manufacturers may well announce new designs, even larger than the currently largest announced 15MW from Siemens Gamesa. Larger turbines will require larger array cables, and we should see a pathway put in place this year to allow the shift from 66 to 132 kV systems. Some demonstrations of robotics for operations and maintenance have been delayed by the pandemic, but we’d expect to see progress towards full integration with wind farms. Drone operators have a weight off their minds as the Civil Aviation Authority has increased take-off mass, meaning the potential for larger deliveries of around 12kg to site this year. While we won’t see large components being transported this way, drones could deliver spare parts or tools, reducing turbine downtime.