Ten places to keep an eye on for offshore wind

Over the past few years, and especially in 2020, new geographical areas have been getting onto the offshore wind map and are likely to have their first projects up and running in the next decade, or the time leading up to 2050 – when renewable energy and other energy transition developments should be majorly contributing to a net-zero world.

This includes countries and states where both domestic and foreign developers are exploring opportunities for first projects, those which are working on their policies to enable offshore wind development (or to ease and speed it up), as well as those which have a wider framework supporting wind energy deployment off their coasts but have yet to set up their own policies and targets.

Brazil has over 16 GW of offshore capacity in planning as of end-2020, according to Fitch Solutions’ report from December 2020. Among those planning to install wind turbines off Brazil’s coast are also some of the biggest oil & gas players, which are now increasingly using their capital and experience in the offshore wind market.

Back in August 2018, Brazilian oil & gas major Petrobras revealed it was developing a pilot offshore wind farm off the Guamaré municipality in the state of Rio Grande do Norte, which would be built by 2022. The following month the company signed a Memorandum of Understanding (MoU) with Equinor to jointly develop offshore wind projects in the country.

Two years later, Equinor submitted an application for an environmental impact assessment needed to further look into the possibility of developing wind projects offshore Rio De Janeiro and Espírito Santo.

Another MoU was signed in the country in September 2020, between the government of the Brazilian state of Ceará and China’s Mingyang Smart Energy, which wants to develop an ”offshore wind complex” and, as part of that plan, the company inked an MoU with Pecém Industrial Complex (CIPP) in October 2020 to build a pilot offshore wind project off the coast of Pecém by 2022.

According to the World Bank’s report on eight emerging markets’ potential from 2019, Brazil has technical offshore wind potential of 1,228 GW – 480 GW for fixed-bottom and 748 GW for floating wind turbines.

In the Americas region, the U.S. is the only country with wind turbines up and running off its coasts. However, while some of the country’s coastal states already have operational projects or are steps away from building their first offshore wind farms, others are yet to have their first offshore areas leased for wind energy.

Of the latter, one of the most interesting might be Louisiana, a mainly oil & gas-oriented state so far, whose Governor recently announced the first offshore wind steps. In November 2020, Louisiana Governor John Bel Edwards initiated the creation of a task force to coordinate commercial leasing proposals for offshore wind energy in the federal waters off the state’s coast.

Louisiana’s move came several months after a study was released on Gulf of Mexico’s offshore wind potential, estimating that 4,470 jobs could be created and almost half of a billion dollars could be poured into the economy with only one 600 MW offshore wind farm built in the Gulf.

With the target of 30 GW of offshore wind by 2030 and speeding up the permitting processes, announced in March, U.S. states that were lagging in the offshore wind area could soon pick up the pace. 

In the second half of 2020, plans for first offshore wind projects started emerging in Italy.

In June 2020, Energia Wind 2020 srl, part of the Italian energy company 3R Energia srl, submitted an application to the Italian government for a 30-year concession of an area in Italy’s sector of the Adriatic Sea, where it plans to build a 330 MW offshore wind farm. The site is located off the coasts of Rimini, Riccione, Misano Adriatico and Cattolica municipalities, in the stretch of sea pertaining to the Port Authority of Rimini.

The following month, Italian wind developer 7 Seas Med S.r.l. requested a 30-year concession to develop a 250 MW floating offshore wind farm in the Sicilian Channel, some 37 kilometres off Marsala on the north-western coast of the Sicily. At the end of the last year, Copenhagen Infrastructure Partners (CIP) got on board the project by investing in the development company 7 Seas Med.

In August 2020, Saipem signed an MoU with AGNES and QINT’X to develop a 450 MW offshore wind farm in Italy. The project will comprise approximately 56 turbines on fixed foundations at two different sites, located offshore Ravenna in the Adriatic Sea.

As the European Union has set its offshore wind goal to 300 GW by 2050 within its energy transition ambitions, emerging markets such as Italy are very likely to contribute to the target.

Political commitment through the EU target is also a push for the Member States which have not yet officially been working on their offshore wind plans, but which have vast offshore wind potential, such as Romania and Bulgaria.

Romania holds technical offshore wind potential of 76 GW, according to data published by World Bank in May 2020, around the same time the country’s power producer Hidroelectrica revealed plans for Romania’s first offshore wind farm. Of the 76 GW, World Bank mapped 22 GW of fixed-bottom potential in areas closer to the country’s coast and in water depths of up to 50 metres.

While Romania does not currently have a specific offshore wind policy, the country is politically committed via the EU target of 300 GW offshore wind by 2050, and is working on its national Marine Spatial Plan that is expected to be finalised by May, according to a recent report from Aegir Insights.

The Black Sea countries of Ukraine, Romania, and Bulgaria have a combined technical offshore wind potential of 444 GW, with the bulk of it (314 GW) coming from Ukraine. However, Ukraine’s offshore wind market is at a very early stage as no political actions aimed specifically at offshore wind have been taken.

Bulgaria, on the other hand, has a national target of 4.5 GW of wind power by 2050 and is also committed to energy transition via the EU offshore wind target. Offshore wind is expected to play a role in both meeting EU requirements and the country’s own wind power target. 

Bulgaria is also working on its Marine Spatial Plan, in collaboration with Romania. While there are good prospects for offshore wind in Bulgaria with commitments in place, the market is still lacking specific offshore wind legislation, according to the report from Aegir Insights.

At the beginning of this year, Greek wind energy association ELETAEN launched public consultation for a legislative framework for the development of offshore wind, following last year’s announcement by the country’s government that it was considering a new offshore wind legislative framework.

This March, Ocean Winds (OW), a joint venture between EDP Renewables and ENGIE, signed a collaboration agreement with the Greek renewable energy company Terna Energy to co-develop floating offshore wind projects in the country. The companies said they were joining forces to identify the most suitable areas and consequently develop a pipeline of projects in excess of 1.5 GW, with a consistent development roadmap rolled out throughout the current decade.

Last year, Chalkis Shipyards and a number of Greek institutions announced that they were collaborating on a project seeking to study the potential of floating offshore wind in the Greek Seas. In 2019, Greek companies Streamlined Naval Architects LTD, ETME, ERGOMARE S.A., and Enalios Diving Center deployed a FloatMast platform in the Aegean Sea, off the coast of the island of Makronissos, to provide meteorological data for a period of twelve months.

According to WindEurope, given the characteristics of Greek waters, it is likely that the country will mostly see floating wind installed off its coasts.

In 2018, Turkey invited applications for the development of a 1.2 GW offshore wind project, but the tender was then postponed due to demanding requirements and lacking site data. World Bank expects an offshore wind auction in the next three years, which could lead Turkey to having operational offshore wind capacity by 2030.

While political commitment to energy transition and an already well-developed local supply chain for onshore wind are good starting points to realising its first projects by the end of the decade, uncertainty regarding financing could mean longer lead times and a preference for building more onshore wind first could lead to first projects in Turkish waters to be operational in the early 2030s, Aegir Insights said.

Both Aegir Insights and WindEurope have highlighted the floating wind potential in Turkey, with its most adequate floating offshore wind resources found in deep waters in the Eastern Mediterranean and Black Seas.

Earlier this month, Azerbaijan’s Ministry of Energy signed a Memorandum of Understanding (MoU) with the International Finance Corporation (IFC) to cooperate on offshore wind development. The aim of the cooperation is to assess the potential of offshore wind in the country and the development of a roadmap, and later, tender management related to relevant projects, the definition of partnerships with the private sector, and the implementation of auxiliary investments.

The work stipulated by the MoU will be implemented within the IFC Offshore Wind Development Program, funded by the World Bank’s Energy Sector Management Assistance Program (ESMAP).

Preliminary analysis provided by ESMAP states that the technical potential of offshore wind energy in Azerbaijan is estimated at a total of 157 GW – 35 GW for fixed-bottom projects and 122 GW for floating wind.

While there are signs of political action on offshore wind in Azerbaijan, Aegir Insights said the market was still at a too early stage to support predictions of a build-out timeline. In terms of capacity, the analyst stated that three countries with access to the Caspian Sea resources – Kazakhstan, Azerbaijan, and Turkmenistan – had a combined technical offshore wind potential of 758 GW, both fixed-bottom and floating.

One of the eight countries highlighted in the World Bank’s 2019 report on 3.1 TW of offshore wind potential in emerging markets was India. The country has made the news with its offshore wind plans more than a few times over the past several years. However, India has been slow in reaching the development stage, even though it has set an offshore wind target of 5 GW by 2022 and 30 GW by 2030.

At the beginning of 2019, India’s Ministry of New and Renewable Energy (MNRE) issued draft offshore wind energy lease rules for the development of projects within the country’s Exclusive Economic Zone (EEZ). Later that year, the country’s National Institute of Wind Energy (NIWE) launched a tender seeking the turnkey supply of four offshore LiDARs for two sites.

In May 2020, India’s NTPC Ltd. and Oil and Natural Gas Corporation Limited (ONGC) signed an MoU to set up a joint venture company to explore building offshore wind and other renewable energy projects both in India and overseas. The companies did not reveal any information on offshore wind projects specifically.

According to the World Bank, India has 112 GW of fixed-bottom and 83 GW of floating offshore wind potential, with best opportunities located in Tamil Nadu and Gujarat.

In March 2020, the Philippines’ Department of Energy awarded Triconti Windkraft Group with a contract for exclusive rights to study and develop the first offshore wind projects in the country. Triconti Windkraft Group, a Filipino-Swiss-German partnership, has plans to develop two wind farms off the coast of the Philippines: in Aparri Bay in the north and in Guimaras Strait in the Central Philippines. The two projects have a total capacity of 1.2 GW.

The Philippines too are among the eight emerging markets in the World Bank’s report from 2019, which identified 18 GW of fixed-bottom and 160 GW of floating wind potential within 200 kilometres off the country’s coasts, with the best areas being in the north and central parts of the Philippines.

To tap into its potential, the Philippines also has work to do on its policies and electricity market. Electricity prices are among the highest in Southeast Asia, due in large part to dependence on expensive imported diesel, oil, and coal. The government’s renewable energy target is 50 per cent by 2030, with the majority coming from hydro (8.7 GW) and geothermal (3.5 GW), followed by wind (2.4 GW), the World Bank said in 2019.