Global Offshore Wind Technology Trend - Asia Wind Energy ...Delivering renewable energy insight™ Availability of other resources Many markets still have other cheaper untapped resources

Analyst PRESENTATION

Delivering renewableenergy insight™

Global Offshore Wind

Technology Trend

Andy Lee

[email protected]

18 September 2018

Delivering renewable energy insight™

Contents

▪ Offshore Wind Market Assessment

▪ Offshore Wind Turbine Technology Trend

▪ Offshore Wind Installation Technology Trend

▪ Offshore Wind O&M Technology Trend

▪ About MAKE/Wood Mackenzie Power & Renewables

Delivering renewableenergy insight

TM

Offshore Wind Market

Assessment

5 July 2018


Global offshore wind growth

Source: MAKE

Growing momentum in China, Taiwan and the US amid subsidy wind down in Northern Europe as markets transition to competitive auctions.

Global offshore wind capacity to reach 87GW by 2026 Offshore Wind Market Assessment

14

12

10

8

6

4

2

0

16

+16% CAGR

2026e2025e2024e2023e2021e2020e2019e2018e

3.9

2017e

3.3

Cum.

2016

14.2

Grid

-co

nn

ecte

d c

apa

city (

GW

)

2022e

EMEAAPACAMER


Adjusted strike prices LCOE development, 2017-2026e

Note: Strike prices adjusted to 15-year periods, taking development and

transmission costs into account.

Source: MAKE

China offshore wind market still have 9.4GW pipeline reserve before entering auction scheme. The change of incentive policy will drive offshore wind LCOE to decrease considerably.

Record-low offshore subsidy prices increase confidence in sectorOffshore Wind Market Assessment

0

50

100

150

2015 201820172016

(EUR/MWh)

Germany

Netherlands

Denmark

UK Belgium

0

20

40

60

80

100

’25e’22e’17e

(EUR/MWh)

Year

ChinaNetherlandsUKGermany

Source: MAKE, Siemens, MHI-Vestas

Offshore wind has cost down opportunities in multiple areasOffshore Wind Market Assessment

Major factors for LCOE reduction


TM

Offshore Wind Turbine

Technology Trend


7

1

9

10

5

0

2

6

4

8

20122010 2011 2015 Single

preferred

orders

20162014 20172013

3 2.7

Total orders

(GW)

7.3

1.6

3.2

1.5

3.4

1.2

3.0

0.4

2.0

0.2

1.3

0.20.20.2

1.9

0.2

2.4

Offshore wind turbine orders, globally, 2000-2017

Order intake is starting to pick up in China

Source: MAKE

Offshore Wind Turbine Technology Trend

APAC USEurope Globally

Average APAC order size Average US order sizeAverage European order size

650

450

500

550

600

400

350

300

250

0

50

100

150

200

Average order

size (MW)


Offshore turbine portfolio, Europe

Source: MAKE

Offshore turbine portfolio, APAC

Source: MAKE

Next generation turbines to exceed 15MW ratingsOffshore Wind Turbine Technology Trend

Senvion

SGRE

Adwen

GE MHI Vestas

Next generation

Bidding Future upratingsUpgrades

75

100

125

150

175

200

225

2 3 4 5 6 7 8 9 10 11 12 13 14

Ro

tor

dia

me

ter

(m)

MW rating Next generationBidding

Hitachi

Sinovel

Doosan

United Power

XEMC

SEwind

MingYang

Goldwind

GE

Envision

CSIC

TYHI

DEC

Hyosung

75

100

125

150

175

200

225

2 3 4 5 6 7 8 9 10 11 12 13 14

MW RatingR

oto

r d

iam

ete

r (m

)


Turbine rating, globally Rotor diameter, globally

Source: MAKE Source: MAKE

Turbine upgrades to drive increases in turbine ratings towards 2023 in Europe, while the introduction of second generation 6MW turbines will drive medium-term boost in China.

Turbine rating to more than double over the next ten yearsOffshore Wind Turbine Technology Trend

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

Tu

rbin

e r

ating

(M

W)

+117%

+48%

+139%

’25e’23e’21e’19e’17

Europe APAC US

120

130

140

150

160

170

180

190

200

210

220

230

+50%

+11%

+52%

’25e’23e’21e’19e’17

Ro

tor

dia

me

ter

(m)

USAPACEurope


TM

Offshore Wind Installation

Technology Trend


Offshore demonstrators, globally Floating demonstrators, globally


Suction bucket jackets to be rolled out commercially in Europe from 2019.

Next push will be for new monopile and gravity-based designs.

Floating wind enters the pre-commercial stage in Europe Offshore Wind Installation Technology Trend

48

0

50

100

150

200

250

300

350

(MW)

2021e2020e

129

69%

31%

2019e

80

61%

8%

10%21%

2018e

170

4%

3%

75%

18%

2%

46%

4%

YE/2016

314

5%13%

11%

8%

38%

25%

185

19%

29%

2017

Floating

Multipile

Tripod

Gravity-based

Jacket

Monopile

24

0

10

20

30

40

50

60

70

80

90

55%

2019e

49

51%

2018e

743%29%

29%

(MW)

35

14%

86%

YE/2016

16

68%12%

19%

2021e

48

100%

2020e

89

13%

5%

27%

2017

France US

Japan

UK

Portugal

Norway

Italy


Global foundation forecast

Jacket foundations will continually increase their share

Source: MAKE

Offshore Wind Installation Technology Trend

2

0

5

14

10

12

8

4

6

7

11

1

9

13

3

19%

35%

47%

’22e

19%

24%

57%

’21e

23%

23%

54%

’20e

8%21%

68%

39%

8%16%

76%

’18e

3.28%

17%

75%

’17

2.7

7%

88%

’26e

(GW)

’25e

20%

39%

8%

51%

39%

YE/16’

13.8

7%

’19e

8%

75%

’24e

13%

35%

47%

’23e

5%

Tripod & tripileJacketMonopile Multipile FloatingGravity-based


Availability of other resources

Many markets still have other cheaper untapped

resources on land, making the governments

less willing to incur the extra cost of floating

Growth of offshore wind

The global offshore market is expected

to grow at a CAGR of 17% towards 2027

Water depths >60m

There is still a large number of offshore

sites in <60m water depths

Development of floating concepts

More than 40 floating concepts are

being developed with 250MW expected

to be demonstrated offshore by 2021

The catch-22 of floating wind can stretch floating wind’s road to commercialization

Governments will play a key role in floating wind’s rolloutOffshore Wind Installation Technology Trend

Source: MAKE

The catch-22 of floating wind: Capacity is needed in order to reduce costs of floating wind, but cost reductions are needed for governments to allocate capacity to floating wind.

Supply chain maturity

The step into serial production will be chal-

lenging due to the complexity and size of floating

concepts and demanding lead time requirements

Politically attractive

Local content, limited environmental

impact and less local opposition

makes floating politically attractive

Cost reductions of offshore wind

X% of floating’s cost developments

are linked with fixed offshore wind,

meaning that cost for fixed,

especially on the turbine site,

will benefit floating

Development in bottom-fixed concepts

Costs of bottom-fixed foundations continues to de-

crease which both reinforces the entry barriers

to the <60m space and impacts the oppor-

tunity costs of allocating floating sites

Stalls floating’s road to commercialization

Drives floating’s road to commercializationCost

Commercialization

Capacity


Turbine characteristics Lifecycle of vessels, Europe


Vessel owners push to extend the lifetime of their vessels in the European offshore wind market as requirements for vessel installation continue to increase.

Vessels built 2012-2014 are already being upgraded Offshore Wind Installation Technology Trend

73

41

7

141

105

30

225

164

35

0

20

40

60

80

100

120

140

160

180

200

220

240

(m)

1991 20262017

Max hub heightMax water depth Max rotor diameter

Seek

opportunities

outside of

Europe

Transit from MP

and turbine

installation to

TP installation

O&M &

Decommis-

sioning

Upgrade crane

capacity and

length, length of

legs and

deckspace


Turbine installation fleet and installation requirements, Europe

Next-generation turbines will challenge current fleet

Source: MAKE

Offshore Wind Installation Technology Trend

80

100

120

140

160

180

200

220

240

260

40 50 60 1101009080703020100 120

Requirements to the

length of jack-up legs (m)

Co

mb

ined

req

uire

me

nts

to th

e le

ng

thof

jack-u

p le

gs a

nd

hoo

k h

eih

gt(m

)

Apollo

Orion

Requirements to turbine

installation with COD 2017-2021



Maximum requirements

Average requirements

Minimum requirements



Combined backlog &

track record in MP/TP

(300MW)

Orders for projects with COD 2017-2026

Under construction

Only orders for projects with COD <2017


TM

Offshore Wind O&M

Technology Trend


Operators are increasingly trying to optimize logistics costs through long-term commitments and utilization of crew transfer options across sites in order to lower LCOE.

OPEX and O&M costs to be reduced significantly

OPEX in Europe, 2016-2025e


OPEX breakdown, 2016

Offshore Wind O&M Technology Trend

0

20

40

60

80

100

120

2020e

OPEX reduced by 34%

LCOE

(EUR/MWh)

93

74

2016 2025e

116

OPEX

Other

O&M

Insurance premia* Other

Decommissioning reserve

Technical and commercial management

O&M costs

Logistics

Turbine

BOP

* Insurance premia considerably below 20% for

leading utilities.


For leading utilities and turbine OEMs, innovative and tailor made logistics solutions are key to ensure safety and reduce downtime.

Offshore logistics solutions

Solutions available for offshore wind O&M crew transportation

Source: MAKE

Note: ”Offshore solutions” are typically in combination with CTVs, daughter crafts and/or helicopters.


Distance to shore

We

ath

er

co

mp

lexity

CTVs

Advanced CTVs and helicopters

Floatels

”Onshore solutions” ”Offshore solutions”

Walk-to-work accommodation vessels

Service operation vessels (SOVs)

Fixed accommodation platforms


CTVs to be used alone for nearshore projects and in combination with SOVs and floatelsfor sites further from shore.

15% of operational projects deploy more than one means of transport

Logistical solutions and service volumes

Source: MAKE


5km 30km 60km

# of turbines operating

217 265

0

3,000

500

1,500

1,000

2,000

2,500

1,871

2,518

804

1,555

204

680

Distance to shore

>60km

YE2015 YE2020e


Source: MAKE

New innovative platform concept introduces a HeliPort, ensuring landing platform for SOVs and allowing helicopters to refuel. Could also be used for oil and gas applications.

Early stage platform

Few fixed platforms to date, but could be used as a way to extend the

applicability of CTVs as projects move further from shore


Innovative platformAs-is today platform

DONG Energy’s Horns Rev 2 project

was the first project to attempt to use

a fixed platform. The platform has no

Helipad and the project is located

30km from shore.

Only accommodation

Vattenfall uses the platform to service

Dantysk and Sandbank projects

located 70 and 90km from shore,

respectively. Used in combination

with CTVs in summer time and

helicopters in winter time.

Accommodation with Helipad

Fred Olsen Windcarriers’s concept

with separated accommodation,

HeliPort and offshore substation.

HeliPort allows for refuelling of

helicopter and supports SOV and

CTV operations.

Accommodation with HeliPort

1 2 3

Project: Horns Rev 2

Installation: 2002

Accommodation: 24 people

Project: DanTysk / Sandbank

Installation: 2015

Accommodation: 50 people

Project: Unknown

Installation: Expected 2019

Accommodation: > 50 people


TM

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MAKE – Wind Power Focused Intelligence ProviderAbout MAKE

A sample of MAKE clients

Andy Lee

Managing Consultant, APAC

▪ Leads the consulting project execution in APAC region,

mainly in China

▪ Focuses on wind turbine technology, wind farm

solutions and overall value chains

▪ Analyses and develops various analytical frameworks,

methods and models

▪ Closely monitors industry participants and provides insights to meet customers’ business goals

http://www.vestas.com/

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Documents

Global Offshore Wind Technology Trend - Asia Wind Energy ...Delivering renewable energy insight™ Availability of other resources Many markets still have other cheaper untapped resources