Offshore wind could meet the world’s total electricity demand 11 times over by 2040 attracting a 15 fold increase in investment to USD1 trillion along the way.
This is according to the International Energy Agency’s (IEA) recently published report entitled Offshore Wind Outlook 2019. You can download a copy at www.iea.org. The report states that “the untapped potential of offshore wind is vast,” and that “the promising outlook for offshore wind is underpinned by policy support in an increasing number of regions,” including European North Sea countries and China. Based on its assessments, the IEA says offshore wind could potentially generate 420,000 TWh of electricity globally per year – currently we consume 23,000 TWh of electricity.
The report says, however, that harnessing the full potential of offshore wind energy will require governments to clear the path ahead for offshore wind’s development by providing the long-term vision that will encourage industry and investors to undertake the major investments required to develop offshore wind projects and link them to power grids on land. That includes careful market design, ensuring low-cost financing and regulations that recognise that the development of onshore grid infrastructure is essential to the efficient integration of power production from offshore wind.
Industry needs to continue the rapid development of the technology so that wind turbines keep growing in size and power capacity, which in turn delivers the major performance and cost reductions that enables offshore wind to become more competitive with gas-fired power and onshore wind.
What’s more, huge business opportunities exist for oil and gas sector companies to draw on their offshore expertise. An estimated 40% of the lifetime costs of an offshore wind project, including construction and maintenance, have significant synergies with the offshore oil and gas sector. That translates into a market
opportunity of USD 400 billion or more in Europe and China over the next two decades.
The report predicts that China is likely to have the world’s largest offshore wind fleet by 2025, overtaking the U.K. as the current world leader. And that China’s offshore wind capacity will rise from 4 GW today to 110 GW by 2040.
The report carries particular weight not just for the enormous claims being made of wind power, but also because the IEA was long seen as skeptical about the potential of renewable energy.
In his foreword to the report, International Energy Agency Executive Director, Fatih Birol, notes that while offshore currently generates only 0.3% of global power, “its potential is near limitless” and “improved technology and steep cost reductions are putting more and more of that potential within our reach.”
The report will surprise both industry observers and renewable energy campaigners alike as the IEA was for many years unconvinced of the potential of renewable energy, including wind, to produce sufficient energy for the world’s needs. In 2000, IEA stated that non-hydro renewables would make up a 3% share of world energy generation by 2020. That figure was reached in 2008.
Now, with the IEA declaring that offshore wind as single source of renewable energy could provide more power than we can use, it would appear the answer my friend, to our need for affordable low carbon energy is blowing in the wind.
Barry J Piper
General Manager Asia, Cooper & Turner Group