by Jerome a Paris
Sat Jan 22nd, 2011 at 08:29:22 AM EST
The 2010 statistics for offshore wind came out this week, and they look pretty good:
With 308 new offshore wind turbines installed in 2010 - an increase of 51% in installed wind power capacity on the previous year - offshore wind power experienced a new record growth in Europe. In total, 883 Megawatt (MW) of new capacity, worth some €2.6 billion, were installed in 2010 in nine wind farms in five countries, making a total of 2,964 MW.
(...) 2010 saw an improving financing environment with private banks, financial institutions like the European Investment Bank (EIB), utilities and pension funds backing the sector. Two major deals completed in 2010 highlighted the brighter financial outlook: Thornton Bank C-Power and Trianel Wind Farm Borkum West both came to financial close.
Amongst the projects completed this year was Belwind, the financing of which I played a role in
, as well as Thanet, the current "largest offshore wind farm in the world
(soon to be dethroned by Greater Gabbard, whose first turbines were connected to the grid this week
and where the pictures illustrating this story were taken, by me, during a site visit last summer).
With 315 MW of today's existing fleet having being built with project financed, and an additional 194 MW having been refinanced, roughly 20% of offshore wind is on the books of banks for the long term already; the financings closed late lat year ensure that at least the same will be true for the next couple years, and one can expect a bigger proportion in future years. In other words, money will be there to make the planned investment pipelines a reality. Enquiring minds will note that there was a financing in December to which I did not participate - the Borkum West one. I did work on the file last year in my previous job, but was not there for its successful conclusion, and can thus no longer claim to have been involved actively in all deals! This is of course good news, as it simply underlines that the sector is broadening and deepening, with many new entrants and more people with the relevant experience. There will be work for lots of old-fashioned bankers in the sector in coming years.
And the offshore leader is indisputably the UK, which is somewhat ironic for a country that doesn't do industrial policy. And while it is true that the wind farms currently being built are largely manufactured outside the UK (Thanet, in the Thames estuary, was even installed out of Dunkirk, France), there now is a definite move by all industrial players towards creating facilities in the country. My google alert for "offshore wind" increasingly includes, in addition to the traditional NIMBY articles from the US, items about industrial investment in various parts of the UK (such as the recent announcement by Siemens to locate new facilities in Hull) - which means that offshore wind is associated with "jobs" as the main public narrative, rather than with bird deaths or subsidies.
Germany, which also has a huge pipeline of projects, several of which are under construction already, is not yet very visible in the statistics, but the country can enjoy the fact that it provides a lot of the equipment for the industry - in addition to several turbine manufacturers for the sector (Repower, Areva - but not Siemens which is really a Danish company in this sector), many German components provide critical sub-components like the gearboxes, transformers, generators or the cranes and tractors which are needed to move all these heavy pieces of metal around...
Strangely enough, while the Europeans are moving to large scale offshore wind, the US are worried about their gap with China, which has built one 100 MW offshore wind farm so far, but has made many grandiose announcements about their offshore investment plans. When one considers that one third of the existing onshore wind fleet is not even connected to the grid, and that the rest is beset by poor operational performance, one can only wonder how offshore turbines will perform over there... But of course, why would one worry about dominance of an industry of the future by declining, stagnant Europe?
Part of my Wind Power series