Energy Transition Handbook 2021 - Flipbook - Page 21
Only ten years ago offshore wind was a niche industry, limited to a few European
countries. Since then there has been a global breakthrough of offshore wind as an
essential technology for electricity generation in order to reduce global greenhouse gas
emissions. Impressive cost reductions, technical maturity and global support have
transformed this industry into a great success story.
The global support for offshore wind beyond its
European core markets has already taken off.
Governments from around the world clearly
have trust in offshore wind as a source of clean
electricity generation. Today offshore wind
turbines are up and running in countries across
Asia, North America and Europe. New markets
such as South Korea, Vietnam, India, Australia
and Brazil are taking concrete steps to introduce
regulations for the development of domestic
commercial scale offshore wind projects.
In addition, technological advancements such as
the advent of floating foundations for offshore
wind farms create further spectacular growth
opportunities as they open up new “deepwater”
markets such as California, Spain, Norway
for offshore wind development over the past 5
years. Auctioned wind capacity in 2019 surpassed
40 GW worldwide, accounting for two-thirds
of total new capacity and doubling auctioned
capacity compared to 2018.
In the UK, offshore wind is now frequently hailed
as the future backbone of the UK’s energy system.
The UK market will require a huge expansion of
its currently operational 8 GW of offshore wind
capacity to meet the 2050 ‘net-zero’ greenhouse
gas emissions target – it is estimated that the UK
will need around 75 GW of offshore wind to hit
‘net-zero’. Globally this figure needs to be nearer
1,000 GW to reach sustainability targets.
As with onshore wind, offshore wind carries wellknown challenges for electricity grids and power
systems through its variability and uncertainty, as
well as its distributed nature. Wind farm planning
also requires sensitivity when assessing the
surrounding environment and this is something
which will become increasingly important as
sustainable credentials and environmental impact
are scrutinised in the future.
Over the next decade, the worldwide capacity of
offshore wind in operation will increase by 75 GW
and the European Union is expected to contribute
40 GW to it. The market volume is expected to
increase by USD 230 billion in the same period.
In 2018, an auction in the US of seabed rights near
the Massachusetts islands of Martha’s Vineyard,
Nantucket and Rhode Island’s Block Island
resulted in bids totalling more than USD 405.1
million for three lease areas for up to a maximum
of 4.1 GW of capacity. These same areas of seabed
failed to attract any bids during the 2015 auction
process showing the spectacular cost reductions
Hogan Lovells has worked with clients to deliver
offshore wind projects across the world, from
the UK (with the largest operating offshore wind
capacity in the world) to Taiwan.
The technical reliability of offshore wind is also
now widely accepted. The successful track record
of dozens of wind farms across Europe has
proven the technology’s maturity and, in 2017,
the Danish Vindeby offshore windfarm project
was decommissioned after 26 years of successful
Notwithstanding recent cost reductions and
the proven track record, offshore wind is still
a relatively expensive technology to develop
‘Excellent service and expertise in wind
energy. Especially good expertise in
Legal500 EMEA, 2021 (Energy)