Carbon Trust’s Offshore Carbon Trust s Offshore Wind AcceleratorAccelerating progress of offshore wind Accelerating progress of offshore wind energy through targeted R&DNOWITECHNOWITECH21 January 2011

Phil de VilliersPhil de Villiers

Our mission Independent company mainly funded Our mission is to accelerate th t

by UK Government

W t b bthe move to a low carbon

We cut carbon now by

Providing specialist advice and finance to

help organisations cut carbon

economySetting standards for carbon reduction

We cut future carbon emissions by

Opening markets for low carbon technologies p g g

Leading industry collaborations to

commercialise technologies

Investing in early stage low carbon

2

companies

UK faces an energy gap and tough renewable energy target

% of UK energy from % of UK energy from I t ll d it j t d I t ll d it j t d

90

% of UK energy from renewables, 2005-2020

% of UK energy from renewables, 2005-2020

Installed capacity, projected demand (GW), 2008-2020

Installed capacity, projected demand (GW), 2008-2020

15%

70

80

90

Projectedpeak demand

E

40

50

60

NuclearRenewables

peak demandEnergy gap

8x increase required

10

20

30Gas

uc ea

1%2%

0

10 Coal

20202008 20152010

1%

2020 target

20102005

3Source: Committee on Climate Change, 2008 (based on DECC Energy Model)

Mass deployment of offshore i d i d t t t twind required to meet targets

Forecast UK 2020 electricity supply in 40% scenario

160

TWh

100

120

140 2026

6

26

Up to 25% of electricity to

f

60

80

100

151

26 come from Offshore Wind

20

40

60

91 6,000 turbines to be installed by 2020

0

20

TotalOther1SolarHydroWave and tidal

Onshore wind

Offshore wind

by 2020

4

and tidalwindwind1. Landfill, co-firing, biomassSource: Carbon Trust “Offshore wind power: big challenge, big opportunity”, 2008; BCG analysis 2008

Deployment rates are very h ll i b t f ibl

Off h Wi d

challenging but feasibleBuild rate similar to coal in the 1970s and gas in the 1990s

6GW pa

Coal:28GW

Gas:26GW

Offshore Wind:Up to 29GW

4

5

6

3

4

1

2

0

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

Could create 70,000

5Source: Carbon Trust “Offshore wind power: big challenge, big opportunity”, 2008; LEK Consulting, Renewable Energy Framework March 2006, Carbon Trust “Focus for Success”, 2009

jobs in UK by 2020

But cost reduction is essentialBut cost reduction is essential

3.0

3.5

Cost per MW installed (€m/MW)

Rhyl FlatsRobin Rigg

Drivers Rising commodity prices B ttl k i l h i

2 0

2.5

3.0

Gunfleet SandsBurboNorth Hoyle

Bottlenecks in supply chain Complexity of sites, distance, depth FX rate volatility

1.5

2.0Lynn

Kentish Flats

Scroby Sands

0.5

1.0 Barrow

0.02002 2003 2004 2005 2006 2007 2008 2009 2010

Year

6

Source: Emerging Energy Research, 2009

Increasing RD&D is critical

Weak comme cial St onge comme cial

gIncrease project IRRs to accelerate deployment

Weak commercial returns, high levels

of public subsidy

Stronger commercial returns, lower levels

of public subsidy

£16b£75b

£14bn

£16bn£75bn

£45bn

Current expectation

Optimal site availability

Cost reductions

Achievable goal

7Source: Carbon Trust “Offshore wind power: big challenge, big opportunity”, 2008

Offshore Wind Accelerator is a ti t d tconsortium to reduce costs

Objective: Reduce cost of energy by 10% through RD&D

8 developers + Carbon Trust

Focusing on developing Focusing on developing technologies for– Round 1 & 2 extensions– Round 3

S i h i i l– Scottish Territorial Waters

Total budget ~£40m£10 f ll b ti R&D– £10m for collaborative R&D

– Up to £30m for demonstrations– Carbon Trust funds 1/3

Commitment to 2014– Started October 2008

8

60% of UK market is in OWA:tt ti f i t

Round 1 Round 2 STW & Demo Round 3 Total marketDeveloper

attractive for innovatorsOWA developers have 30GW of licensed capacity in UK waters

RWESSECentricaSPR

Round 1 Round 2 STW & Demo Round 3 Total marketDeveloper

14%6,555

12%6,015

12%5,809

11%5 350

3,750

3,983

3 600

4,185

453

1 500

1,518

250

504

1,430

2,202

194

10

150

SPRVattenfall

DONGStatkraftStatoil 5%

2,408

2,408

11%5,350

5%

9%4,396

6%2,884

2,250

3,600

2,250

3,600

280

1,500

158

158

498

250

2,406198

240

StatoilMainstreamSiemensFluorE.ON 4%1,809

1,985 4%

2,000 4%

2,360 5%

,,

1,733

2,000

2,000360

300600

252

244

SeaEnergyEDPEnecoWarwick 650

900

975

1%

2%

2%

1,238 3%913

56090

Fred OlsenMasdarEDFAREG 58

90

200

415 1%

0%

0%

415

200

90

9OWA Stage II partners

Source: RenewableUK (Jan 2010), The Crown Estate (May 2010)

OWA objectivesOWA objectives

F i l t d i t f b 10%Focus on commercial outcomes: reducing cost of energy by 10%

Deliver innovations that can be implemented by offshore wind developers in time for Round 3 (~2015)p ( )

Learn by drawing on the experiences of the different members– Offshore wind, oil and gas, onshore wind

Encourage the best designers to deliver the innovations– Let them keep their IP– Look internationally, not just to UK– Engage them on very specific challenges

Look to other industries for technology transfer– Not just oil and gas but also civil engineers naval architects manufacturers– Not just oil and gas, but also civil engineers, naval architects, manufacturers

Operate responsively to member needs, and cost effectively

Objectives require

10

Objectives require very targeted R&D

OWA involves 90+ people from 8 Developers, 400+ companies

Steering Committee

Carbon Trust Management TeamCarbon Trust Management Team

90+ peopleTechnical Delivery

Consultant

Technical Delivery

Consultant

Technical Delivery

Consultant

Wake Effects AccessFoundationsTechnical Delivery

Consultant

Electrical

Consultant Consultant Consultant

Technical Working Group

Technical Working Group

Technical Working Group

Consultant

Technical Working Group

Innovators, designers

Innovators, designers

Innovators, designers

Innovators, designers

OWA partners

400+ companies

11

Carbon Trust

3rd party contractors

Farms will be large, far-shore, ith bi t t

180m

with bigger structuresRound 3 zones

Moray Firth 1.3GWEDP 1GW SeaEnergy 0.3GW

65m

220mFirth of Forth 3.5GW

SSE 1.7GW Fluor 1.7GW

Dogger Bank 9GWSSE 2.25GW

220m

SS 5GStatoil 2.25GWRWE 2.25GW

Statkraft 2.25GW

Hornsea 4GW Mainstream 2GW Irish Sea

100m

Mainstream 2GW, Siemens 2GW

Norfolk 7.2GWSPR 3.6GW,

Vattenfall 3.6GW

Irish Sea4.2GW Centrica

-60m

30 St Mary Axe(the Gherkin)

Hastings

Bristol Channel1.5GW RWE

Average distance to shore (km)

25

8

0 10 20 30 40 50 60 70

Round 2Round 1

12

as gs0.7GW EONWest Isle of Wight

0.9GW Eneco65Round 3

Source: UK Ports for the Offshore Wind Industry: Time to Act, DECC / BVG Associates, 5 February 2009, p.17; Financial Times, January 2010; Carbon Trust analysis

Sensitivity of CoE to depth, distance must be reduced

Depth Distance Wind speedDepth Distance Wind speed

CoE as % typicalnear-shore site

CoE as % typicalnear-shore site

CoE as % typicalnear-shore site

115

120

125

130

120

130

120

130

95

100

105

110

100

110

100

110

80

85

90

95

80

90

80

90

70

75

40-60m

Depth

20-40m0-20m70

0-12 60+

Distance to shore (nm)

30-6012-3070

700-800 900+800-900

Wind power (W/m2)

<700

13Note: Cost analysis for <700 W/m2 wind power, where 100% = £97/MWh (2008 assumptions)Source: Carbon Trust “Big Challenge, Big Opportunity” 2008

Depth Distance to shore (nm) Wind power (W/m2)

Turbine installation rates will d t i d ti ll need to increase dramatically

Number of turbines installed per year 2003 - 20201

1 0001 000

One new turbineinstalled per day

2.5 new turbines installed per day

One new turbineinstalled every 11 days

1,0001,000

900

700Actuals

500500

400400333

Modelled

333300221

150673330302021

202020192018201720162015201420132012201120102009200820072006200520042003

Over 6,000 turbines to beinstalled over 10 years

14

1. Number of turbines calculated from actual and forecast installed capacity figures, assuming 3MW turbines 2003 – 2013, and 5MW turbines from 2014Source: Carbon Trust “Offshore wind power: big challenge, big opportunity”, 2008; Carbon Trust analysis 2010

y

OWA has four Research AreasChosen based on assessment of 70 technical areas

Offshore wind returns

YieldOPEXCAPEX

g c

ost

sFin

an

cin

g

Access SystemsFoundations

F

Wake effects

Electrical systems

15

Our competition attracted >100 t i f ll th W ld

Foundations

entries from all over the WorldObjective: reduce lifecycle costs for 30-60m

88104

9

7

Rejected in Total entries Rejected in Finalists

16

first round second round

Three fixed structures installed

Foundations

separately to turbine

MBDK tBallast Needamdrilled monopile

MBDsuction bucket

monopile

KeystoneInward Battered

Guide System

17

Three integrated structures

Foundations

floated out for installation

Giff d / BMT / SPT Off h & Gifford / BMT / Freyssinet Gravity Base Foundation

SPT Offshore & Wood Group self-

installing tribucketOWPSE Titan

18

One floating structure

Foundations

One floating structureGlosten Tension Leg Platform

19

Four structures short-listed for f th d l t

Foundations

Giff d BMT F i t

further developmentBased on suitability for Round 3

K tGifford-BMT-Freyssinet Keystone

MBD SPT Offshore & Wood Group

20

Current focus: Mass production,

Foundations

I t ll tiF b i ti

and faster, cheaper installation

InstallationFabrication

Improve utilisation ratesStandardise, optimise, automate

IHCAirbus A320

Next step: demonstrate conceptsare ready for deploymenty p y

Electrical systems is focusing

Electrical Systems

on higher voltage arrays

V lid t t d b fit f Validate costs and benefits of higher voltage arrays

– Design impact of higher voltage– eg, cables, substation, transition

– Supplier engagement to ensure equipment will be available

– Determine optimal voltage

22

Increase accuracy of wake ff t d l

Wake Effects

effect modelsReduce financing costs, increase yields

1.2 Model A

0 9

1

1.1

1.2

wer

Model B

Model C

Model D

M d l Db

0.7

0.8

0.9

orm

alis

ed P

ow Model Db

Model Ea

Model Ec

Model F

Coloured lines represent different

d l

0.4

0.5

0.6No

Model F Stable

UpWind

Measured Data

Upper 25%

models or model variants

Next stepsDevelop more accurate wake effects models

1 2 3 4 5 6 7 8Column

Upper 25%

Low er 25%

Develop more accurate wake effects modelsDevelop tools to optimise layoutsMeasurement campaign to reduce data collection costs

23

Test performance of floating LIDAR

Competition for technologies to increase O&M days

Access Systems

increase O&M daysClosed 26 November 2010: 450 entries, ~50 from Norway

24

ConclusionsConclusions

W b li OWA i f l d l f ll b tiWe believe OWA is a successful model for collaboration

Cost-effective approach for performing R&D– Each members’ annual contribution generates 12x research

Efficient forum for members to learn from each other

Successful for screening the market for new technologies

Promotes technology transfer from other industries– Allowing new companies to enter the market

Very targeted R&D: Keeps focused on commercial returns

but we are still learning and would welcome further

25

…but we are still learning and would welcome further collaboration with research organisations and innovators

Is more collaboration needed?Is more collaboration needed?Number of offshore wind research projects

0 5 10 15 20 25

15

23

0 5 10 15 20 25

Turbine development

Grid integration

No. projects

8

10

15

Ecosystem

Grid integration

Foundations

5

7

y

Wind resource assessment

Wake effects

4

5Access / O&M

Electrical systems

4Floating wind turbine OWA focus area

26Source: Carbon Trust analysis 2010

Questions

Phil de VilliersPhil de Villiersphil.devilliers@carbontrust.co.ukwww.carbontrust.co.uk