The Chinese Opportunity by Giles Hundleby

Offshore wind in China has progressed slowly to date. The previous target of 30GW will not be reached by the end of 2020. But the National Energy Administration is making extra efforts to accelerate deployment. Over 3GW is approved to start construction or project development and a new target in China’s INDC (for onshore and offshore wind combined) of 200GW installed capacity by 2030 has been set. With a significant chunk of this likely to be offshore to provide power to the populous east coast, the sector looks to ready to take off.

With relatively low subsidy levels, driving down the cost of energy is paramount. China is looking to the UK to see how to learn the lessons of cost reduction. This may seem strange given that LCOE for offshore wind in China is already reported as being lower than in Europe. The comparison is distorted by China’s much lower cost of labour and materials and so mask the “real” story of project CAPEX and the early experience of OPEX and availability.
China is willing and able to learn from our history of offshore wind. Europe’s early offshore wind farm developers experienced sometimes spectacular construction cost and time overruns and early-life failures of blades, gearboxes and grouting that had a huge effect on costs. Those mistakes have driven new approaches to project development, contracting, surveying, vessels, turbines, foundation and substation design together with more rigorous and effective control of offshore construction, and subsequently, operations.

By using the best companies available and applying these lessons, China can still significantly reduce the cost of offshore wind at a fast pace. It seems from the recent visit to the UK that China is very motivated to do just that and the opportunities for proactive companies could be game changing.

Giles Hundleby

Director

BVGA

2017-05-12T15:18:29+00:00 04/12/2015|Views|