Offshore Wind Industry Having Problems

February 28, 2014

Birds, sharks and World War II-era bombs are getting the blame for holding up offshore wind farms and raising doubts about the costs of the technology, says Bloomberg.

This month, three utilities tossed aside plans to expand the world's biggest offshore wind farm in the Thames estuary in England. Over the last three months, each of the six largest U.K. utility companies have pulled back from marine energy projects, citing cost and technical challenges as well as environmental issues.

  • "There's a bit of realism that unless we can deliver these projects for a lower price, then it's unrealistic to expect to continue to get political and government support," said Keith Anderson, chief executive officer of Iberdrola SA's ScottishPower Renewables unit.
  • The British government has set an industry goal of reducing costs to £100 ($167) per megawatt hour by 2020. Currently, costs are estimated at £147, and meeting that target is unlikely.
  • Companies are trying to find all sorts of ways to bring down costs, including building more powerful turbines.

Companies have closed down projects for a number of reasons.

  • In December, ScottishPower pointed to basking sharks as their reasons for ending a wind project.
  • German and British companies have had problems with finding old munitions. Two years ago, one company found a number of World War II mines as it began laying cables for a project. The discovery slowed down the cable-laying process, which was only just completed.
  • Last week, EON, a German utility, along with Dong Energy A/S and Masdar Abu Dhabi Future Energy Co., scrapped expansion plans as the company could not guarantee that it could make required progress, even if it could meet the required three-year-long study on the impact that the wind machines would have on a fish-eating bird.

Source: Alex Morales, "Offshore Wind Industry Slowed by Birds, Bombs, Sharks," Bloomberg, February 20, 2014.

 

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