In Europe, offshore wind costs have dropped dramatically in the past few years. One of the key trends driving the dramatic reductions in cost for offshore wind is the increase in size of offshore wind turbines. For a given project capacity, using fewer, larger turbines reduces the total cost of installation and operation on a per-MW basis.
“As recently as 2014, the average size of turbines installed in Europe was around four megawatts,” Mechling said. “This figure was near six megawatts in 2017, with eight-megawatt turbines starting to be installed the end of 2017 and now turbines up to 9.5 megawatts are slated for installation in 2019.”
The trend does not seem to be slowing down with even larger turbines in the works such as GE’s 12-megawatt Haliade-X turbine with a 220-meter rotor diameter. “In the U.S., the first projects will be able to take advantage of these developments, leapfrogging earlier technology to deliver rapid cost reduction,” he added.
In addition to the increase in turbine size, the decrease in costs is also driven by maturing of the supply chain and intense competition. Here in the U.S., industry experts were predicting that these factors would eventually lead to offshore wind costs similar to what is currently being delivered in Europe, but not until a domestic supply chain and optimized infrastructure are developed. However, the recent announcement of the price for Vineyard Wind (6.5 cents/kWh) suggests otherwise.
“No one expected the cost to be that low,” Drunsic said. “What a lot of policymakers are seeing now is that, not only is this a renewable resource, it is also a viable economical option. For some ratepayers, the Vineyard Wind project will lead to lower electricity rates, which is shocking.”