DNV’s New Research On Industry’s Perception Of The Growing Market

DNV’s new research for floating offshore wind and its possibilities for mass commercialisation.

According to the report, reaching these targets is ambitious, but early signs are promising, with 60% of organisations with revenue-producing businesses in wind expecting to increase investment in floating offshore wind in 2023.

"The view from the industry is clear. There is overwhelming confidence that floating wind can achieve commercial success in a little over 10 years. DNV predicts that by 2050, 15% of all offshore wind installed capacity will come from floating turbines.

"However, barriers must be overcome." "Governments can play a leading role in making the market attractive for investment with long-term, stable policy and regulatory frameworks and by adapting critical infrastructure such as grids and ports," comments Ditlev Engel, CEO, Energy Systems at DNV.

According to Ditlev Engle, the industry itself will need to look at cost reduction through greater standardisation and scale-up.

He stated, "At DNV, they are committed to supporting the industry." This is an exciting time for the industry as they move towards commercialization. Floating offshore wind is opening new possibilities for wind power locations and will play a critical role in the transition to a cleaner energy supply.

Reaching full commercialization will depend, in part, on the investment potential of key markets. Market size was cited by 21% of respondents as the first criteria for choosing a market to invest in, followed by regulatory and political stability (16%) and power grid suitability (12%).

For floating offshore wind to scale up, it is paramount that its levelized cost of energy (LCOE) drops as much and as quickly as possible.

DNV’s Energy Transition Outlook forecasts that levelized costs for floating offshore wind will fall by almost 80% by 2050. According to the report, 21% of survey respondents believe that standardization—either through a reduction in the number of concepts or the emergence of a preferred concept—will be the most important factor in lowering LCOE.

Next come bigger turbines and industrialization, followed quickly by bigger wind farms, which allow economies of scale and more installed capacity.Standardization was also cited by the industry as a crucial factor to mitigate risk.

Commenting on the supply-chain challenges report, it stated that supply-chain challenges also come into play as the offshore wind sector is battling high commodity prices and capacity limitations. The top risk cited by floating wind professionals was a lack of port infrastructure.

The second biggest risk cited was installation vessel availability, tied with capacity.

While floating offshore wind is generally not reliant on the advanced and bespoke vessels used in bottom-fixed offshore wind, the sheer number of mooring and anchoring installation vessels and the capabilities required could be a challenge for the industry, as more moorings and anchors are set to be installed over the next 10 years than have ever been seen in the oil and gas industry.

"Commercial attractiveness will rely on cost reduction and capture prices in various markets." "Cost reduction does not happen by waiting, which makes it crucial that the first generation of larger floating windfarms be installed by 2030 to deliver on the promising outlook for floating wind," explains Magnus Ebbesen, Segment Lead Floating Offshore Wind at DNV.

According to the report, around 300 GW of floating offshore wind will be installed globally over the next 30 years, requiring around 20,000 turbines, each mounted on top of floating structures weighing more than 5,000 tonnes and secured with so many mooring lines that they would wrap around the world twice if tied end-to-end.