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Offshore: UK

Installed offshore capacity in Europe accounted for 886 MW by the end of 2006. The technology is developing fast – 1.08 GW were installed in the EU-27 in December 2007. However, offshore development is being slowed by the high level of financial and technical risk associated with the projects.

Offshore wind is a significant potential contributor to the 20 per cent target, but certain obstacles hamper its development:

• In most countries, the maritime policy framework is not adapted to electricity production at sea;
• There is often an absence of transparency in for permitting and subsidising processes;
• There is a lack of strategic planning for offshore wind sites;
• There is a lack of coordination regarding offshore grid extension; and
  
• A high level of environmental scrutiny and application of the precautionary principle do not take into account the environmental benefits of wind energy.

Moreover, the integration of offshore wind energy into the grid is strongly affected by the possibilities for trans-European power exchange. The main barriers concerning the connection of offshore wind farms to the national power systems are:

• Transmission bottlenecks;
• Offshore transmission infrastructure and grid access; and
  
• Balancing.

The following case study of the UK illustrates on the one hand the barriers confronted by developers wishing to build an operational offshore wind farm, and on the other hand how successful offshore wind energy can be once administrative and grid barriers have been overcome.

In the UK, offshore wind is growing fast. In 2007, 404 MW of offshore wind capacity was in operation, and a further 460 MW was under construction. In addition, permits have been granted for over 2,700 MW of new offshore capacity. Current programmes for offshore wind make a total over 8 GW of future installed capacity. Work is currently underway to build a new programme, which will aim to deliver up to a further 25 GW of installed capacity by 2020.

Recognising the huge potential for offshore wind electricity generation, the UK regulates the offshore energy installations through the Energy Act of 2004. This Act establishes renewable energy zones (REZs) adjacent to the UK’s territorial waters - taking into consideration the rights accorded in the United Nations Convention on the Law of the Sea (1982) – and creating a comprehensive legal framework for offshore energy projects. The 2004 Energy Act  facilitates the streamlining of the consent process within the REZ and inshore waters.

Barriers

ADMINISTRATIVE BARRIERS

In the UK, six authorities are involved in the authorisation procedures for on- and offshore renewable energy projects, depending on local circumstances. In addition to this, the offshore project developers can decide whether to submit the applications separately to the different authorities or to manage the process through the Offshore Renewables Consents Unit (ORCU) of the Department for Trade & Industry (DTI). The ORCU has established a so-called one-stop-shop, which provides developers with a single liaison point for questions regarding the administration of applications, clarifies issues and provides updates on the progress of all consent applications.

Legislation is currently being reviewed on marine consenting and a new Infrastructure Planning Commission will become responsible for offshore wind consents. Marine planning and strategy frameworks are also being developed. A new system of offshore transmission regulation is currently being developed, where all connections of over 132 kv will require a transmission operator to be established via competitive tendering. The operator will be required to design, build and maintain the transmission system in return for a stream of revenue.

Key barriers identified in the UK are the rather slow approval rate of building applications, as well as limited transmission capacity in parts of the country, in particular between the very windy Scottish locations and the Southern part of the UK. At present, nearly 8 GW of capacity are held up in the onshore planning system, equivalent to nearly 6 per cent of potential UK electricity supply. A further 9 GW from offshore projects are awaiting decision or due to be submitted for consent. In 2006 it took local authorities an average of 16 months to decide on wind farm applications – even though the statutory time period for decisions is 16 weeks.

GRID CAPACITY

The grid connection application for offshore wind farms is given by the UK’s National Grid:

• Grid reinforcements are necessary in order to facilitate the grid connection of offshore wind farms in the future; however, they require very long lead times.
• In wind transmission grid codes there is a trend towards active control of large wind farms within the boundaries of the legal frameworks. This contributes to grid stability, although some contractual issues are still unclear. The capabilities required from large wind farms should be harmonised with TSO-specific set points.
• Common offshore cables bundling several wind farms would be beneficial: Moreover, they can become initial nodes of an international offshore grid. Up to now no bundling has taken place.
• Grid access, energy pricing and balancing are interrelated. To increase the value of wind energy, measures such as adapted demand control, back-up generation and storage are needed. Furthermore, good short-term forecasting will increase the value of wind energy on the energy markets.
• In order to take advantage of the geographical aggregation of wind speed, the transmission of wind power must be possible over distances comparable to the extensions of meteorological systems. Strong trans-European networks are essential for this.

In conclusion, many things need to be done on a technical level in order to integrate large amounts of offshore wind power into the UK power system. The feasibility of integrating large amounts of offshore wind power is mainly a question of finance, and hence closely related to political decisions and the creation of a favourable framework.

RENEWABLES OBLIGATION CERTIFICATES

In the past, only a few offshore wind farms were installed, as they had to deal with low Renewables Obligation Certificates (ROCs) prices and technical difficulties. As a result, the building of offshore wind farms in the rather harsh offshore environment around the UK was very difficult and came almost to a standstill two years ago. With increasing ROC prices and more suitable wind turbine technology, the interest in offshore wind power has now picked up again; however, due to the high worldwide demand for wind turbines, both on- and offshore, it is rather difficult to find wind turbine suppliers that are interested in delivering wind turbines for large offshore wind projects in the UK.

It is expected that in 2009, 1.5 ROCs per MWh will be established for offshore wind.  This increase will be beneficial; however, the increasing steel, aluminium and copper prices will also have an impact on wind turbine costs.

CONCLUSION

Offshore wind is expected to make a large impact on the UK’s 2020 renewable energy targets, and a major expansion is planned. The transmission system will be crucial for the success of this expansion, and efficient and appropriate connections and access will be required.