In May Norway’s government declared offshore wind power a major focus area, with intentions to assign licenses for approximately 1,500 wind turbines totalling 30 gigawatt by 2040, equal to the sum total of today’s hydropower production. Several players are prepared to enter the stage, including TotalEnergies, Iberdrola and Norsk Havind, who have joined forces to develop offshore wind in Norway.
“There’s a significant power potential in offshore wind on the Norwegian shelf, mainly due to three key factors: the size of areas available for offshore wind, favourable wind conditions in the relevant areas, and a strong offshore management and construction industry, with a +50-year oil and gas track record at sea, all of which will benefit offshore wind developments in the years to come,” says Øyvind Gundersen, business developer for renewable energy with TotalEnergies.
Business developer for renewable energy with TotalEnergies
He is clear that consideration for the environment and other sea users is important and points to the fact that the government’s selection of likely fields has taken fisheries and military activity into consideration.
Expecting reduced costs
“Thorough investigations and environmental surveys will be carried out before licenses are granted, and the projects must be adapted to any findings here. Therefore, we will be careful to ensure that installations are adapted to the environment, both in the development, construction, and operational phases,” he says.
Gundersen admits that the cost of in particular floating offshore wind exceeds that of land-based wind farms, but underlines that land-based projects required subsidies and green certificates at an early stage. However, costs have been reduced and turbine sizes optimised, resulting in a competitive production without the need for subsidies.
“We have seen much of the same development for bottom-fixed offshore wind. As a matter of fact in several countries licenses for bottom-fixed turbines are now awarded without the use of subsidies. We are not yet there for floating developments, as costs are currently higher, which again explains why the authorities are setting up state funding mechanisms for floating offshore wind,” Gundersen says, adding: “But we will rely on the costs of such installations deflating, as they have on land, and that is the job now facing us. Pilot projects, in which technology is tested on a smaller scale, will play an important role”.
Have lacked incentives
“We are facing major investments, and in order to achieve this we will rely on good cooperation between developers, the supply chain, the authorities and other stakeholders. In Norway we have been abundantly provided with affordable and clean power, without the incentive to develop new, clean energy sources seen in other countries,” he explains, continuing:
“Now, however, the situation is about to change. The power demand is expected to rise and there are limits to the additional potential from hydropower. The need for clean power from other sources is therefore expected to be significant and the consortium has great confidence in the development of offshore wind as a significant industry in Norway. We are therefore very excited by the ambitions and plans for subsequent license rounds, recently announced by the government, as it provides scale and predictability for the industry.”
“In terms of offshore wind we will of course draw on TotalEnergies’ long experience with large offshore developments in oil and gas, including over 55 years on the Norwegian shelf, as well as the development and construction of offshore wind elsewhere in the world. Together with Iberdrola’s significant experience, as one of the leading players within renewables and offshore wind, as well as Norsk Havvind’s background, through the Valinor group of companies, as a leading developer of onshore wind in Norway, the consortium is very well equipped to create value from our wind resources at sea.”
TotalEnergies is a global multi-energy company that produces and markets energies on a global scale: oil and biofuels, natural gas and green gases, renewables and electricity. Our 105,000 employees work to provide energy that is ever more affordable, clean, reliable and accessible to as many people as possible, and is active in more than 130 countries.
Iberdrola is one of the world’s biggest energy companies and a leader in renewables, spearheading the energy transition to a low carbon economy. The group supplies energy to almost 100 million people in dozens of countries. With a focus on renewable energy, smart networks and smart solutions for customers, Iberdrola’s main markets include Europe, the United States, Brazil, Mexico and Australia. The company supports a workforce of nearly 40,000 and has invested more than €130 billion over the past two decades to help build a sustainable energy model.
Norsk Havvind is a newly formed independent project developer for offshore wind. The majority owner Valinor, has through its subsidiary Norsk Vind, become the largest private developer of onshore wind parks in Norway. Through selected investments and active ownership, Valinor have extensive experience in building successful companies and have a portfolio with great potential in renewable energy production, infrastructure, and aquaculture. The management team and board of Norsk Havvind has extensive experience from planning, development and execution of offshore energy projects.
Export of Norwegian competence
The consortium wants to work closely with local industry and Norwegian suppliers.
“We have long standing traditions for this in the oil and gas projects we have been, and are, involved in developing. It is clear that this is a cooperation we also want to pursue within offshore wind. In addition to assignments in connection with the development of offshore wind in Norway, it is important to ensure that Norwegian suppliers have access to an international market, something we as global players are well positioned to do,” says Gundersen.
“We can do this by involving Norwegian suppliers in projects around the world, like we have done in the oil and gas sector. Potentially, the economic ripple effects will be considerable for the Norwegian supplier industry. We will of course depend on all of our suppliers being competitive, which we have every reason to believe Norwegian suppliers to be. All parts of the value chain must contribute to the right cost development,” he concludes.
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