By Shell on Sep 29, 2021
- Across Europe, wind power is set to further expand, with increasing growth on the horizon up until – and potentially beyond – 2050.
- As wind energy becomes even more efficient, it provides an increasingly promising opportunity for industrial companies looking to decarbonise their operations.
- Various digital technologies are helping to make wind energy even more attractive to businesses by providing greater operational insights and efficiencies.
- Organisations must have a clear strategy on how best to integrate and utilise wind power, as there is no uniform business model.
- This highlights the importance of engaging industry experts, like WindEurope and other industry bodies, in order to educate businesses on how best to capitalise on the efficiency of wind power.
Giles Dickson is the Chief Executive Officer of WindEurope, a position he’s held since 2015. WindEurope is the voice of the European wind industry. It represents the whole value chain of onshore and offshore wind across Europe and has more than 400 members. It engages Governments and other stakeholders on policy and regulation. It organises industry exhibitions, conferences and workshops. And it coordinates publicly-funded R&D in wind.
Dickson is also Chairman of the independent Advisory Council of ENTSO-E, the European Network of Transmission System Operators for Electricity.
From 1992 to 2008 he was a civil servant in the UK Government, working mostly on European affairs. From 2008 to 2015 he worked for the French engineering company Alstom where he was Vice-President for Global Public Affairs.
Renewable energy is no longer a thing of the future – it’s part of our energy generation and usage each and every day. And with research projecting that renewable energy will deliver more than 60% of the global power mix in 2050, attention is rapidly turning to how companies and countries alike can make this energy generation happen1.
At the heart of this equation sits wind energy, which is expected to deliver half of all renewable generation by 2050.2 An industry already seen by many as being firmly within its “golden age”, those working on the frontline believe there is further opportunities to uncover for the sector.
This is certainly the opinion of Giles Dickson, CEO of WindEurope, who is increasingly seeing industrial companies – who were perhaps once reluctant to invest in wind – now becoming its biggest proponent, as he explained to us recently.
Q: What is the appetite for renewable energy adoption in hard-to-abate sectors? Are there any industries that have seized the initiative in adopting renewable energy sources?
A: The perception of renewable energies has changed fundamentally over the past decade. For a long time, energy-intensive industries like steel, cement, aluminium, chemicals, fertilisers, did not like renewables. They felt wind energy was too expansive, that it would mess up the energy system with its “intermittency”.
But wind energy has delivered a remarkable cost reduction over the years and is now among the cheapest sources of electricity across Europe, while different areas and countries in Europe – be it Germany (22%), the UK (27%) or Denmark (48%) – are proving that even high shares of renewables have no significant negative effects on grid stability and electricity supply.3
“Europe was the global pioneer in wind energy. We invented the technology and were the first to deploy it and scale it up.”
And now we are starting to see energy-intensive industries knocking at our door, in search of this cheap electricity to help decarbonise their carbon-intensive processes. Take the chemical sector, for example: in a deal with Vattenfall, chemical giant BASF recently bought shares in Europe’s largest offshore wind farm. What this shows is that they are very clear about their ambitions to electrify and about the large amounts of renewable energies they need to do so.
Q: How do you view Europe’s wind power journey in comparison to other regions around the world? What lessons do you think can be learned/taught from these differences?
A: Europe was the global pioneer in wind energy. We invented the technology and were the first to deploy and scale it up. As a result, we were the first to enjoy its benefits. But, because we were the pioneers, we also bore the lion’s share of the costs involved in developing these technologies; whereas other regions of the world have been able to start deploying wind energy using technology that’s already mature and well-established, and which costs much less now.
But there are pros and cons to both. Having been a pioneer, European companies continue to lead the global wind industry, innovating and pushing the limits of wind turbine technology. And this leadership allows Europe to export turbines and technology around the world, further benefiting from the global expansion of wind energy.
Q: How has the COVID-19 pandemic affected the progress of wind power? Have initiatives such as NextGenerationEU and “Fit for 55” encouraged the growth of the wind sector?
A: Europe built 14.7 GW of new wind farms in 2020.3 This may have been 19% less than what was expected before COVID, but overall, wind energy remained very resilient throughout the pandemic.3 Electricity generation continued seamlessly, and wind energy increased its share in Europe’s electricity mix to 16%.3 More importantly, the financial markets gave a vote of confidence: despite the pandemic, Europe raised €43bn to finance 20 GW of new wind capacity in 2020.4
With strong tailwinds behind it, Europe has therefore set ambitious targets for an accelerated expansion of wind energy. The European Commission’s “Fit-for-55” proposal raises the EU’s renewable energy target from 32% to 40% by 2030. This means the EU will need 451 GW of wind power capacity by 2030, up from 180 GW today, which equates to 30 GW of new wind installation every year between now and 2030. An ambitious goal since, as it stands, we expect to build only 15 GW a year over 2021-25.5
In their National Recovery and Resilience Plans, the European Member States have also earmarked important investments in grid and port infrastructure. These investments are an important condition for the acceleration of Europe’s wind energy across both onshore and offshore.
At the end of the day, however, these targets will remain academic if we don’t get permitting right. Across Europe, permitting procedures for new wind energy projects are currently too drawn-out and complex, while there are simply not enough skilled staff to process the increasing number of new permit applications. With this in mind, we are urging the European Commission to streamline the permitting of new wind energy projects.
Q: The research Shell undertook in collaboration with Goldsmiths University of London highlighted that the complexity of available decarbonisation options is a major barrier to progress in industry. How can businesses overcome this challenge – and how can they access the external expertise they need to support them on their sustainability journeys?
A: Ultimately, corporates want to reduce the impact of their operations on the environment. This is not only so they can minimise their carbon footprint but also because they want to gain a competitive edge by appealing to consumers and investors that increasingly value sustainability.
Fortunately, there is a wide range of business models that allow corporates to purchase renewable electricity, with varying levels of complexity, commitment, and costs. The downside of this is that no “one size fits all” model exists. The right business models for a particular company will therefore depend on many factors, including its size, experience, risk tolerance, location and demand profile.
Associations can play a key role as clearing houses too, by consulting their members on available decarbonisation strategies and reassuring them of the technical and logistical feasibility of sourcing renewable electricity from wind.
“The work of industry associations (…) is invaluable for businesses that are seeking to decarbonise their industrial processes.”
Q: How will the digital transformation be instrumental in enabling the wind sector’s ambitions in the future?
A: The digital transformation will impact many aspects of wind energy, be it: the automation of manufacturing and production processes; predictive and preventative maintenance; or the modelling and siting of new wind farms.
Digital solutions will also enhance electricity flows, allowing for a better matching of renewable electricity generation and actual demand. As a result, the management of electricity grids will benefit from real-time information, which allows for load and demand side management as well as the optimal integration of batteries and other energy storage solutions.
Q: Can you give any examples of how new digital technologies are helping to make wind power a more viable choice for industry? For instance, how is digitalisation helping to reduce the LCOE in areas by reducing O&M spend?
A: Modern wind turbines include a multitude of digital sensors that provide real time information on electricity production and material condition. This not only reduces the need for human maintenance but allows for precise forecasts that: increase electricity output per turbine; reduce downtimes; and extend the overall lifetime of the assets.
For O&M companies, the so-called digital twin technology is a promising development. The idea here is that O&M companies can create an exact copy of a wind turbine, which can then be used to virtually undertake important tests and scenarios, modelling different load factors, wind speeds, wave strengths or erosion levels.
In the case of Akselos, using digital twins in the design process contributed to a 30% reduction in the weight of steel used in specific offshore wind foundations – saving resources and decreasing LCOE.6
1 Energy Transition Outlook, 2020, DNV, https://download.dnvgl.com/eto-2020-download (accessed 13 May 2021)
2 Energy Transition Outlook, 2020, DNV, https://download.dnvgl.com/eto-2020-download (accessed 13 May 2021)
3 Wind energy in Europe 2020 Statistics and the outlook for 2021-2025, 2021, WindEurope Intelligence Platform: https://windeurope.org/intelligence-platform/product/wind-energy-in-europe-in-2020-trends-and-statistics/ (accessed 7 September 2021)
4 Financing and investment trends 2020, 2021, WindEurope Intelligence Platform: https://windeurope.org/intelligence-platform/product/financing-and-investment-trends-2020/ (accessed 7 September 2021)
5 It’s official: The EU Commission wants 30 GW a year of new wind up to 2030, 2021, WindEurope: https://windeurope.org/newsroom/press-releases/its-official-the-eu-commission-wants-30-gw-of-new-wind-a-year-up-to-2030/ (accessed 7 September 2021)
6 Digital Twins Make Jacket Foundations 30 Per Cent Lighter and Cheaper, 2021, offshoreWIND.biz: https://www.offshorewind.biz/2021/07/14/digital-twins-make-jacket-foundations-30-per-cent-lighter-and-cheaper-research/ (accessed 7 September 2021)