It has become cheaper to produce energy from newly constructed offshore wind farms than from newly built coal or gas-fired power plants, and vast areas are readily available at sea.
The positive “ambition” loop
The development of offshore wind power over the past three decades was made possible by the constructive interplay between visionary policymakers and industry. Governments ensured demand and volume through ambitious green energy targets, political support, funding of public research and dedicated offshore wind policies.
This created a long-term market outlook, enabling industrial developers to take the leap and commit to developing offshore wind parks at an unprecedented scale, which unlocked the financial resources needed to drive innovation and supply chain build-out, to mature the technology and ultimately to make it competitive.
The increasing volumes of offshore wind energy deployment has been instrumental in driving costs down. The drivers have been larger market volume, which has allowed for economies of scale, growing competition, investment into new technologies and technological improvements and a continuous maturation of the supply chain, creating a positive feed-back loop between government policy, industry maturation and cost reduction.
Offshore wind is going globalThe most illustrative element of offshore wind energy’s amazing development is its rapid globalisation. Apart from China, which for some years now has invested in the technology, north-western Europe has long been the only home of offshore wind energy. This is changing rapidly, as governments in India, Japan, South Korea, Taiwan and the US are all deploying or looking to deploy offshore wind energy at large scale. And more countries are expected to join in the future.
What we can learnWith costs decreasing, renewable power production makes electrification an increasingly attractive option, enabling large scale phase out of fossil fuels in transport, heating and industry. And as electrification becomes increasingly feasible in more sectors, the energy system will also be able to utilise even more energy from renewable power sources.
In a fully renewable energy system, other technologies will play a role alongside solar and wind power. These technologies are at different stages of their development, however, with none of them being as mature as solar and wind energy are today. All have the potential to become competitive and scalable green solutions that can contribute significantly to a world fully powered by green energy. But it requires a well-orchestrated collaboration between governments and industry. And to this end, the offshore wind energy experience is instructive.