Abstract
Detailed analysis of technological learning of energy technologies is scarce. For floating wind, this is missing altogether. In this study, we applied experience curve and bottom-up cost modeling methodologies and assessed the long-term cost reduction potential and contribution factors of fixed-bottom and floating offshore wind in their mature markets. Further, to emphasize the role of strongly varying site characteristics of offshore wind farms and their influences, the grid connection cost is separately discussed from the total technology costs (Capital Expenditure and LCOE). Our assessment shows that, excluding grid connection costs, fixed-bottom offshore wind LCOE is 40 €/MWh at 31 GW cumulative capacity (2023–2024) and decline to 28 ± 3 €/MWh by 100 GW. Floating wind LCOE is 123 €/MWh at 1 GW cumulative capacity (2027 – 2030) but decline to 33 ± 6 €/MWh by 100 GW. Moreover, floating wind can achieve cost parity (i.e., 40 €/MWh, excl. grid connection cost) by deploying 21 GW, requiring 44 billion € of learning investment in the form of subsidies to compensate the price gap for the technology in the energy system. We also conclude that grid cost forms a substantial portion of total offshore wind cost, and an integrated offshore grid can efficiently future wind farms and reduce costs. Lastly, we compared our assessment with literature and found that fixed-bottom cost developments are commonly underestimated and the near-term developments for floating wind are overestimated due to limited understanding of component-level cost developments and developing financing conditions.
Original language | English |
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Article number | 103545 |
Number of pages | 14 |
Journal | Sustainable Energy Technologies and Assessments |
Volume | 60 |
DOIs | |
Publication status | Published - Dec 2023 |
Bibliographical note
Publisher Copyright:© 2023 The Author(s)
Funding
This study is part of a research project named ENergy SYStems in TRAnsition (https://ensystra.eu/). ENSYSTRA received funding from the European Union's Horizon 2020 research and innovation program under the Marie Skłodowska-Curie grant agreement No: 765515. This publication reflects only the authors' views, and the Commission cannot be held responsible for any use that may be made of the information contained herein. As part of the ESR training program, the corresponding author performed a three-month secondment at Shell Global Solutions International B.V, the Netherlands. The author would also like to thank members of Shell Global Solutions International B.V. The Netherlands, for fruitful discussions and the valuable inputs provided during the study. The author would also like to thank the Analysis and Insights Team of ORE Catapult, the UK, who actively contributed to this study, particularly Miriam Noonan and Gavin Smart. The authors would also like to thank the reviewers for their fruitful suggestions, which has improved the manuscript. Besides increasing LCOT with distance to shore, increased deployment targets and rapid installation rates of offshore wind add complexity to integrating them efficiently onto the onshore grid. The complexities include rising spatial constraints for offshore energy infrastructures (subsea cable routes [85] ) and the need for long-duration flexibility to manage a high share of renewables [86] . Studies have shown that an integrated offshore grid, with transmission assets serving as grid connection for wind farms and as interconnector, provides more cost advantages through economies of scale, reduces overall environmental impacts, and increases energy security compared to separate radial connections [28,87] . e-Highway2050, a project funded by the European Commission (EC) to analyze the expansion of the pan-European electricity grid, forecasted 336 GW of net transfer capacity (cross-border interconnectors) by 2050 in its 100 % Renewable Energy System scenario. This estimate is roughly a four-fold increase from the capacity in 2020 (90 GW), and the EC has already pointed out the stalling of interconnector expansion due to existing regulatory barriers. In the event of continued delays, CO 2 emissions, variable electricity generation costs, and renewable energy curtailment are expected to increase in the energy system [88] . Moreover, Power-to-Gas and Gas-to-Power conversion routes (e.g., hydrogen) that can re-use existing onshore and offshore gas infrastructures and provide long-duration time-shifting flexibility are regarded as promising solutions to reduce offshore wind power curtailments and increase the utilization of transmission systems [87,89] . These challenges and proposed solutions indicate that the integration routes for future large-scale wind farms will be more complex and integrated, especially if the ambitious deployment targets set for offshore wind are to be achieved efficiently. The development of such an integrated grid infrastructure would require coordinated long-term system-level planning, which is currently absent [90] . This study is part of a research project named ENergy SYStems in TRAnsition ( https://ensystra.eu/ ). ENSYSTRA received funding from the European Union's Horizon 2020 research and innovation program under the Marie Skłodowska-Curie grant agreement No: 765515. This publication reflects only the authors' views, and the Commission cannot be held responsible for any use that may be made of the information contained herein.
Funders | Funder number |
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Commission | |
ESR training program | |
H2020 Marie Skłodowska-Curie Actions | 765515 |
Shell Global Solutions International | |
European Commission | |
Horizon 2020 |
Keywords
- Cost developments
- Energy policy
- Floating offshore wind
- LCOE
- Offshore wind
- Technological learning