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Galvanising offshore wind transmission

The UK aims to reach 50 GW of offshore wind by 2030, from 14.7 GW at the end of 2023. Achieving this target is hampered by challenges in connecting wind farms to transmission infrastructure. 

Thus far, offshore wind farms have connected via radial links to shore. However, the availability of appropriate landing points on the mainland for offshore connections is dwindling as more projects are installed. 

Having a separate landing point for each offshore wind farm can be inefficient and alienates coastal communities. Thus, there is a move towards co-ordinated grids with fewer cables, landing points and onshore substations.  National Grid ESO estimates a co-ordinated grid could reduce onshore landing points by around 50%, although some of those assets would be larger. 

A co-ordinated grid also increases the resilience of the electricity system as an interconnected network creates alternative routes from offshore windfarms to the shore. 

German approach

Such a co-ordinated grid would see planning moving towards the German approach. There, a single transmission system operator, TenneT, has been successfully designing, building and operating connections for offshore wind farms since 2006. 

TenneT has ensured it will have the transmission equipment it will need at discounted prices by “bulk buying”. It has awarded 11 contracts, worth 23 billion euros (£19.6bn) to three consortia, to connect 22 GW of offshore wind in the Dutch and German North Sea by 2031. 

National Grid ESO plans to supplement radial connections for offshore wind with a more co-ordinated approach, to cut bottlenecks to the development of offshore wind farms.

The company also plans to move to bulk buying of standardised equipment for specific projects, which are close to construction. However, regulatory approval from Ofgem is required before National Grid can do this, as there is a risk of programme slippage. This might see transmission equipment bought before it is needed.

Rebalancing risk

In March 2020, Ofgem and the Department for Energy and Net Zero (DESNZ) requested Natural Grid ESO launch its Offshore Coordination Project. The aim of this was to expand the transmission network to enable the growth of offshore wind, be efficient for consumers and take into account the impacts on communities and the environment

Phase 1 found this move, to co-ordination and away from the radial approach, if applied to all offshore projects between 2025 and 2050 could save consumers approximately £6 billion. It would reduce capital and operating expenditure by 18%.

This move to a co-ordinated grid should also lead to Offshore Transmission Owners (OFTOs), rather than offshore wind developers, building some future windfarm transmission links. 

Developers have expressed concerns that they will lose control over a critical component of their projects. They are wholly reliant on the offshore transmission assets for their revenue stream. 

OFTOs building offshore transmission, they claim, results in unpalatable commercial risks for the offshore wind developers, as they do not design nor oversee construction of the link. Transmission charges are largely determined by construction costs, approved by Ofgem. Wind farm owners cannot start selling power until construction of their transmission link is complete.

The risk of not having a route to market due to delays to grid enhancements is a major deterrent to investment in offshore wind as it reduces confidence in the value and timing of project revenue. 

Related challenges

Project design is only one of the obstacles facing offshore wind projects. The time taken to obtain planning approval for an identified transmission project is increasing. 

Projects take around eight years in pre-application and one and a half years in the planning application stage. Only once planning permission is granted, do wind farm developers have the confidence they need to invest in construction of their project.

Another bottleneck is the supply of HVDC transmission systems. The grid increasingly uses HVDC at scale for far from shore wind farms, due to lower lifetime costs than for traditional HVAC systems. While HVDC systems are more expensive to build, they lose less power and can transmit more than HVAC while using the same diameter cable. For large wind farms with long transmission cables, the lower transmission losses outweigh the higher capex. 

HVDC for offshore substations is a recent technology and there are reliability and other issues while it matures. Chief of these is a lack of widely used standards for offshore HVDC systems and components. This can complicate the design and implementation process, adding complexity to interconnecting equipment from different manufacturers. 

However, there is a sense in the market of “learning by doing”. Given the uptake, the cost of HVDC convertors is falling, while comparability and reliability are increasing.

Sold out

A recent Baringa renewables supply chain study found high supply chain risk for, among others, transformers, HVDC convertor stations and HVDC cables. 

Shortages of this equipment is due to rising demand from interconnectors, offshore wind, and grid upgrades.

There is limited transformer and valve manufacturing capacity for converter stations, where a shortage of design engineers also limits the number of projects that suppliers can accommodate.

Despite investment in new capacity, many cable manufacturers are sold out for three to four years. A shortage of cable installation vessels mirrors this.

The National Grid launched its “Great Grid Partnership” in May this year, bringing in design and construction partners. The aim, the company has said, is to provide “long-term strategic contractual relationships”. This followed its long-term HVDC framework, launched in December 2023.

Repowering

An important and emerging issue for offshore transmission is how to upgrade and refresh offshore transmission when wind farms are repowered. Repowering a windfarm involves replacing older wind turbines with newer, more efficient models. 

Normally, the repowered wind farm has a higher power output. This may require upgrades to the transmission system to handle the increased capacity. 

This could involve replacing transformers, cables, or other components that are life-expired or to increase their capacity.  The economics of repowering involve a trade-off between increased operating efficiency and power output, versus significant upfront costs. 

Ofgem are currently consulting on what happens to a transmission system at the end of its regulated revenue period with a focus on whether or not it will run a tender to appoint a new OFTO for a repowered wind farm.

Systematic improvements

The UK government has signalled its intent to do better in connecting offshore capacity.

The government signed the Ostend Declaration in 2023, with eight other Northern European countries. This is to jointly develop the North Sea as the “Green Power Plant of Europe”. 

The intent is to develop an offshore renewable energy system. This will connect countries, with a focus on joint cross-border offshore projects and hubs at massive scale. This regional co-ordination should tackle future transmission bottlenecks. It would give wind farms the increasingly valuable option of selling their power in more than one country.

Government will also ensure communities hosting transmission infrastructure can directly benefit from supporting the delivery of secure, low-carbon energy. 

The UK signed a joint statement with Ireland and Belgium in May committing to closer co-operation in offshore wind. As a result, Ireland’s EirGrid will work with its UK and Belgian counterparts.

National Grid has said it is working on plans to connect offshore wind clusters in the UK to neighbouring countries. It has predicted this could reach 15-24 GW by 2035.

Joined up

The magnitude of the required investment in offshore transmission, and the multiple barriers to accelerated delivery, mean co-ordinated improvements are necessary. Government, National Grid and industry, are working to develop tactical and strategic reforms with the aim of radically cutting the connections queue. Both political parties seem to understand that major offshore transmission expansion is urgently required.

The UK will need to compete to attract investment in HVDC manufacturing and other infrastructure. This area has been overlooked thus far, neglected in favour of the wind farms themselves. Without a means to connect to the grid and sell power, these projects cannot move ahead.

There is a need for UK-based manufacturing capacity, which must be bulwarked by capacity, skills and workforce.

Offshore wind is a hot topic around the world. The UK has an early start in the field, but as a result is encountering problems that all must consider.

The country has an opportunity to build up expertise in offshore wind connections. It can profit from this both at home and by exporting this knowledge abroad. To seize this chance, though, there is only a narrow window.

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