THE APPETITE FOR RENEWABLE ENERGY
PRESENTS A SIGNIFICANT
OPPORTUNITY FOR WIND POWER
THE APPETITE FOR RENEWABLE ENERGY PRESENTS A SIGNIFICANT OPPORTUNITY FOR WIND POWER
Governments are striving to meet their commitments to the 2015 Paris Agreement on Climate Change taking steps to reduce greenhouse gas emissions and limit global warming to less than 20C. Significant progress is already being made.
According to a Forbes article, in the first half of 2020, for the first time, EU member states generated more power from renewable sources than fossil fuels and across the world strong commitments are being made to renewable energy initiatives including Wind, Solar, Battery Storage, Fuel Cell and other renewable energy sources.
Industry is also taking steps to drive towards a Carbon Neutral position, through their own initiatives to reduce their carbon footprint as well as offsetting this using sustainable power sources. It is projected that through demand, the Wind Generated Power capacity will grow almost fourfold by 2030.
However, desire alone will neither ensure nor accelerate the growth of the Wind Energy Market. With most parts of the world experiencing an energy surplus, Wind Turbine Manufacturers and Wind Farm Operators have to ensure they are competitive, not just with traditional power generation, but with other sustainable sources.
The need to compete is driving continuous transformation across every part of this industry and in the coming pages we will explore some of the macro and micro factors driving change and the role that L&T Technology Services is playing in supporting the Wind Power industry.
BY 2030 TOTAL INSTALLED WIND CAPACITY IS ESTIMATED TO BE 2,015 GW
IN 2018 TOTAL
CAPACITY WAS 565 GW
Source: IRENA – Future of Wind
COMPETITIVE ADVANTAGE IS
DEPENDANT ON COST EFFICIENCY
COMPETITIVE ADVANTAGE IS DEPENDANT ON COST EFFICIENCY
The fundamental factor in the accelerated growth of Wind Energy is the ability of the industry to continually drive down the cost per kWh. With the removal of many subsidies, it will be those Wind Turbine manufacturers who are able to accelerate cost reduction that will gain the competitive advantage and become the partner of choice for Wind Farm operators. The cost differential has to be considered from two perspectives.
CLOSING THE GAP ON TRADITIONAL METHODS
Whereas Governments and Industry are striving to utilise renewable energy sources, this does not come at any cost. The switch to renewable sources will only be accelerated if these sources are close in comparative terms to the cost of traditional non-renewable sources.
COMPETITIVE WITHIN RENEWABLE SOURCES
Advancing solar technology is driving down the cost of this energy source alongside continued innovation and development of other renewable sources; the adoption of wind power is dependent on it being competitive and complementary to other renewable sources.
To achieve the cost points projected for 2030 of between $0.03-0.09 kWh and then continue to hit a projected cost point of between $0.02-0.07 kWh in 2050, will require greater efficiencies across the full lifecycle of wind power generation.
$0.08kWh for Onshore$0.16kWh for Offshore
$0.06kWh for Onshore$0.13kWh for Offshore
$0.03-0.05kWh for Onshore $0.05-0.09kWh for Offshore
Source: IRENA – Future of Wind