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What are the opportunities for wind developers, policy makers and local communities? And what obstacles to successful implementation do we urgently need to overcome? Lorenzo Palombi explains.

Wind turbines have become part of our modern landscape. In 2020, Europe installed 14.7 GW of new wind capacity and this success continued in 2021, with offshore installation in particular set to reach record levels.

Lorenzo Palombi

And there is no slowing down. It is expected that between 2021 and 2025, Europe will install 105 GW of new wind capacity, provided governments meet the targets they have set themselves.

With these bold commitments to net zero targets and Europe poised to increase its portfolio of onshore and offshore wind projects to meet them, what are the opportunities for wind developers, policy makers and local communities? ?

And what obstacles to successful implementation do we urgently need to overcome in the coming year?

Market Maturing

The European wind market has grown considerably over the past 25 years.

Continuous technological improvements along with improved capacity factors have driven costs down, helping wind power solidify its position as a key driver of the clean energy transition.

Historically, mechanisms such as feed-in tariffs, designed to stimulate investment in renewable energy, have played an important role in helping to advance the wind sector.

However, as the market has matured over the years, with increased competition and falling prices, subsidies have diminished, and we are now at a stage where wind power can be delivered at grid parity.

It’s not just a steady decline in costs that has helped wind power become more mainstream, rapid technological innovation has also boosted the sector.

Advancements in manufacturing design, such as larger blades and taller impellers, have boosted production capacity.

Digitization increases the ability to streamline operations, integrate farms into the physical landscape and optimize energy production. AI technology even helps in the maintenance of wind farms and helps reduce the risk of power plant failures.

We now have wind technologies that can significantly reduce greenhouse gas emissions at a competitive cost, but we need to move much faster on implementation.

Recognize the potential of offshore wind

To reach net zero by 2050, governments and institutions globally need to install wind power at three times the current rate over the next decade, creating 180 GW of new wind power each year.

Urgent expansions in onshore and offshore wind are needed to help achieve these goals. The potential of onshore wind power is proven, representing 80% of new wind power installations in 2020.

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But now, to accelerate the sector to the necessary pace, the focus is increasingly on the development of offshore wind. Floating offshore wind, in particular, will drive growth and prove a more viable option for regions that need to consider deeper water installations.

With European companies representing no less than 90% of the global offshore market, the region is well placed to lead the way in the development of the sector.

Indeed, offshore wind has the greatest growth potential of any renewable energy technology, but a number of factors, including the political environment, must improve rapidly for the technology to reach this potential.

Overcoming regulatory and infrastructural barriers

Too often complex and onerous bidding rules slow down the development process of offshore wind projects. A clear regulatory framework that facilitates the development, implementation and operation of commercial offshore wind projects is a key requirement for more widespread adoption.

A free market framework where developers scout potential sites directly, then independently apply for and obtain permits, is the most effective way to enable the industry to accelerate at the pace needed to reach net zero.

Image credit: Stock

In addition to addressing regulatory challenges, we need to relieve pressure on grid capacity, which is currently one of the biggest bottlenecks to the widespread implementation of offshore wind.

A more holistic approach is needed to enable the developer to factor grid planning into the development process of an offshore wind project from the outset.

Overcoming these barriers will help evolve the market to enable the standardization of the necessary technology, particularly with regard to floating structures and turbines.

This will ultimately lead to the competitive Levelized Cost of Electricity (LCOE), which is key to driving widespread adoption.

Achieve greater adoption

Rapid wind acceleration is essential if we are to achieve climate goals and strengthen global independence from fossil fuels. It will also help to hedge against the high electricity prices we are currently experiencing.

However, too many challenges to the practical implementation of this technology remain. The problem we face is that the climate targets set at the national and international level do not sufficiently take into account the changes required at the local level. At the same time, innovation goes beyond regional policy.

In order to meet these challenges and implement wind technology at the required speed, it is essential that we continue to educate and involve key stakeholders, from politicians, institutions and administrations to local residents, so that they understand the enormous opportunities represented by the transition to renewable energies.

Communities must be involved at every stage of the development of a wind project. Partnering with local businesses, enabling economic participation or providing community funds from project profits are all ways to underline commitment to benefit local residents.

With the expansion of the wind energy industry which is expected to create 3.3 million jobs over the next five years, the socio-economic benefits of market development, along with the obvious sustainability benefits, cannot be overemphasized.

Despite these challenges, it is certain that wind energy is an essential part of the sustainable future that the planet and its inhabitants urgently need.

We have a great opportunity to achieve net zero goals, but unlocking this potential at the required pace will only be possible when we address regulatory and infrastructure challenges and enable greater engagement at the local level.

Lorenzo Palombi is Global Director of Wind Projects at BayWa re

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