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Europe wind industry sees growth offshore

Europe’s wind power industry has high hopes that offshore wind farms can help maintain double-digit growth rates in a sector boosted by high oil prices.
Cranes lift up the rotor of a giant wind generator near Hamburg
A huge wind turbine destined for offshore use is constructed in Brunsbuettel, Germany, last year.Christian Charisius / Reuters file
/ Source: Reuters

Europe’s wind power industry has high hopes that offshore wind farms can help maintain double-digit growth rates in a sector boosted by high oil prices.

“The future of wind energy depends on the offshore market,” Arthourus Zervos, President of the European Wind Energy Association (EWEA) told an offshore wind power conference on Wednesday.

The global wind power market is seen growing by around 15 percent annually in the coming years.

Governments around the world are increasingly relying on an expansion of wind energy, especially offshore, to curb greenhouse gas emissions, blamed by many scientists for causing global warming.

Official targets for boosting renewable power generation and high oil prices also gave leading wind turbine makers, Denmark’s Vestas and Germany’s Siemens Wind Power reasons for optimism.

“There is no doubt that the development in fossil fuel prices is increasing interest in wind power,” Vestas CEO Ditlev Engel told Reuters. “There is a tremendous potential but it’s also very challenging.”

Higher costs an obstacle
The main challenges to offshore wind power include high investment costs compared to onshore wind farms and a reliable technology as windmills and electrical systems at sea are exposed to tough weather conditions.

Industry analysts estimate offshore costs are 4 to 6 times higher than onshore costs.

German engineering conglomerate Siemens entered the wind power industry a year ago, when it acquired Danish private-owned Bonus Energy.

“Offshore wind power is certainly taking off. A large scale kick-in is likely by 2008,” Siemens Wind Power CEO Andreas Nauen told the conference.

He expects offshore to account for up to 12 percent of total new wind power installations in 2010, versus around 1 percent currently.

Siemen’s Bonus Energy has supplied turbines to the world’s biggest offshore wind project, the Nysted Offshore Wind Farm, located around six miles off the coast of south Denmark.

Nysted has a capacity of 166 megawatts. The 72 mills, more than 100 yards tall, are generating electricity corresponding to the annual consumption of 145,000 households.

Setback in Denmark
Vestas, with a 34 percent share of the global wind power market, has no specific targets for offshore revenues, but the group has recently established a dedicated offshore business unit.

Vestas has supplied turbines to almost 55 percent of all installed offshore megawatts. But last year its showpiece project Horns Rev, off Denmark, suffered a setback when machinery houses had to be brought onshore for repairs.

Horns Rev covers around two percent of total Danish electricity use.

Denmark is the fourth biggest wind power market in the world after Germany, Spain and the United States. Around one quarter of Denmark’s electricity use is covered by wind power but on a global scale, wind power only accounts for less than a half percent.