[REPORT] Outlook is Positive for Offshore Wind in the U.K.
According to a new report out from GlobalData, offshore wind in the U.K. is expected to reach 11 GW and attract £4.6 billion in investments by 2020. The analysts expect the market to grow 17% each year from a 2013 installation capacity of 3.7 GW.
Offshore wind in the U.K. has surged in recent years with a compound annual growth rate of 43% over the past decade. This has seen the sector grow from 0.3 GW of capacity in 2006 to 3.7 GW last year. GlobalData said this is because of the U.K.’s “aggressive renewable energy targets, policy backing and a shift towards a greener climate.”
By 2020, the U.K.’s government hopes to generate 15% of its energy from renewable sources. In the U.K., offshore wind produces around 3% of total energy generation.
With this expected increase in capacity, increase in investments is expected to rise. The further implementation of offshore wind projects will make areas currently unusable for wind farms usable, opening up a ton of possibilities.
“The last decade has seen offshore wind progress from an immature to a proven technology, which is expected to contribute significantly to the achievement of the UK's renewable targets,” Swati Singh, energy analyst for GlobalData, said. “Overall project costs have risen as a result of increasing water depths, distance from the shore and average turbine size. With a number of UK installations anticipated between 2016 and 2020, annual investment in the market will jump from $3.3bn (£2.0bn) in 2013 to $7.53bn (£4.6bn) by 2020.”
The clear leader in offshore wind in the U.K. is energy giant Siemens, who accounts for 73% of total installed capacity in the country. Worldwide, Siemens accounts for 56% of total capacity. This week, it was announced that Siemens and the Associated British Ports will develop a £310 million wind turbine manufacturing plant in the city of Hull in the east.
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.