In pursuing the EU’s strategic autonomy and industrial competitiveness, offshore wind’s significance cannot be overstated. President von der Leyen announcing the European Wind Power Package during her State of the European Union address has confirmed wind energy as a cornerstone of the EU’s upcoming comprehensive industrial policy, which itself is fortified by the Green Deal Industrial Plan and its accompanying legislative proposals.
Yet despite offshore wind’s vast potential, its current deployment within the EU is severely lagging due to factors such as the energy crisis, surging costs, a saturated components market, and chronical regulatory bottlenecks. Worryingly, 2022 statistics reveal that the EU is falling behind its wind energy deployment targets.
To bolster the European offshore wind industry’s global standing, it is crucial to focus not only on high wind speed technologies, where the EU has excelled, but also to craft technologies suitable for low and medium wind speed areas, such as the Black Sea and the Mediterranean regions. This strategic assessment is vital both for decarbonising regions with weaker wind speeds, necessitating tailored offshore wind technologies, and for positioning the EU in the global offshore wind industry landscape for these lower wind speed areas.
Wind classes and the Black Sea and Mediterranean regions
Standardised categories for offshore wind conditions provide a framework for assessing wind resources. Average annual wind speed determines these classifications, leading to three categories: Class III (average wind speeds below 7.5 m/s), Class II (7.5 to 8.5 m/s), and Class I (exceeding 8.5 m/s), according to the International Electrotechnical Commission. This categorisation respectively designates – with a certain degree of simplification – these classes as low wind, medium wind, and high wind.
In Europe, regions surrounding the North Sea, Baltic Sea, Irish Sea, and the Atlantic coast offer extensive areas with average wind speeds surpassing 10 m/s, providing ample opportunities for wind energy. Historically, offshore wind development in Europe has centred on these high-wind areas, particularly the North Sea, where shallow waters favour bottom-fixed solutions. These solutions have progressed rapidly towards full commercialisation.
While floating offshore wind technology has made strides in the EU, its concentration predominantly remains in these high-speed areas, including the Atlantic coast where a stepped coastline necessitates floating solutions.
However, several other European regions experience much weaker offshore wind speeds, such as the Black Sea and almost the entire Mediterranean, where few – if any – offshore areas attain Class I (the fastest) wind conditions. For these regions, technologies need to be customised to Class II/III conditions, involving adjustments to, for example, rotor diameters, blades, generators, or pitch regulation.
The economic viability of offshore wind in these areas increases with distance from the shore, due to the more stable and stronger winds found there. This thus requires floating offshore wind technologies adjusted for Class II/III conditions.
Unfortunately, floating offshore wind technologies for Class II/III remain a niche market, not just in Europe, but worldwide. On the global stage, Asian technology developers, primarily from China, have established their dominance in the Class II/III offshore wind turbine market, particularly for bottom-fixed solutions.
Simultaneously, the EU still maintains a competitive edge in expertise related to floating structures. But the pivotal question revolves around whether – and how – the EU should strategically advance floating offshore wind technologies within Class II/III areas to strengthen the ‘made in the EU’ wind industry.
The chicken-and-egg dilemma
The plan to advance floating technologies for EU Class II/III areas is in motion, with several demonstration projects now underway. However, the scalability of such endeavours in the EU would depend on their ability to overcome the ‘chicken-and-egg’ dilemma: limited market demand for these technologies results in a supressed appetite to advance them.
Thus, developers are reluctant to commit to Class II/III regions when more lucrative opportunities are readily available elsewhere across Europe. Wind speed classes are crucial for determining the annual energy production of wind turbines as the power that can be extracted by a wind turbine is proportional to the wind speed cubed. This means, for example, that doubling the wind speed increases the available power available eightfold. Therefore, annual energy production in Class II/III areas is generally less competitive, and project developers are likely to concentrate their resources on offshore projects in high wind speed areas.
Under high pressure already, could the offshore wind industry be willing to engage with less profitable areas? Globally, with Asian developers dominating the bottom-fixed market for Class II/III, EU developers may find it unattractive to pursue this path, especially as the EU’s market for Class II/III regions remains limited, primarily encompassing the Black Sea and Mediterranean.
Thus, with little appetite for these technologies on the market, few solutions are emerging on the technology side. Floating offshore wind for Class II/III remains a niche area, with demonstration units only expected to reach a meaningful number by 2030… at best.
The supply chain and the level-playing field
While technologies hold the key to unlocking the potential of offshore wind in low and medium wind speed regions, the supply chain is equally pivotal. Innovative solutions tailored for Class II/III often require components (such as larger and uniquely suited turbines) not readily available on the market. The component market also tends to be saturated, with suppliers primarily focusing on larger clients.
This leaves smaller demonstration projects, such as for Class II/III floating technologies, disproportionately affected by higher incurred costs and congested supply chains. They face even more difficulties in upgrading to TRL 7-8, hampering their growth potential.
Saturated markets for components are a significant concern, which also closely ties into the increasing reliance on Chinese solutions for Class II/III technologies.
The playing field becomes even more unbalanced as Chinese companies, often heavily subsidised, can offer project developers de-risking terms that European companies simply cannot match, especially now during a period of crisis. It raises questions about the potential risks associated with European industry’s dependency on China for Class II/III technologies and supply components.
All this underscores the need for strategic thinking and effective EU policy solutions to promote offshore wind development in Class II/III regions. The economics and technology of offshore wind in these regions warrant careful consideration, especially concerning the reconciliation of these dynamics with other, more profitable, regions across the EU, as well as the global positioning of this strand of the EU’s offshore wind industry.