By the end of 2018, offshore wind energy produced just 23 gigawatts of power, compared to 540 gigawatts which was produced from onshore wind energy projects. Given that wind speeds offshore are much better than on land, offshore wind energy production should have been more than the onshore production.
Offshore wind energy stems from the onshore wind energy farms. Increased wind speeds offshore are the main reason for this, however it produced more than 23 times electricity than its onshore counterpart. Offshore wind energy is a sector which has improved massively over the past 10 years; however, it is still a relatively new technology and has only had about 20 years of proper development and serious research put into it.
The increased offshore wind speeds mean that there is an underlying reason for production of offshore wind energy farms being so much less.
In recent years countries have increased their efforts and investment into offshore wind energy generation. Countries have brought in supportive policies and there have been great technological advancements made in the sector. Mainly the UK, the Netherlands, Germany and China have contributed the most to the sector and have made it an attractive prospect for investors.
Other countries such as Denmark and Norway have also made improvements to the sector. For example, they have removed penalties for project failure therefore giving companies a chance to try new things and learn from them. Other countries have made grants or subsidies to investors who are willing to make offshore wind farms happen, the UK have provided grants of around £10 million per plant to early offshore developers.
One country which has great potential to use offshore wind energy is India with its 7,000 km long coastline. Even though India has made some effort in using offshore wind power, more could still be done. In the last two years India have only added an additional 3.3 gigawatts of offshore power, representing a drop off in investment to the industry and as the world starts focussing more on using offshore wind technology India may start falling behind in the sector. This should be a wakeup call so that they make the most of their massive potential as soon as possible.
Another reason India is falling behind in the offshore wind energy sector is due to the tax burdens placed on the sector. Currently the burden is predicted to be around the 30% mark meaning developers have requested to the Indian government that they get rid of custom duties and impose only a 5% goods and services tax. This would make wind power in line with the oil and gas industries for taxation. This would be a major step in the right direction especially as most wind farm technology comes from overseas.
One of the main constraints with offshore wind projects is that they cost about 5 to 7 times as much as an onshore wind project. The capital cost of the wind turbine in an onshore project makes up around 60-80% of the total costs, however for an offshore project the wind turbine only accounts for 30-50% of the total cost. For offshore projects the cost in connecting to the grid is around 15-30% higher as cables have to laid below sea level to connect everything up. Governments must work on reducing these constraints by offering incentives or subsidies to investors so that more offshore wind farms or made.
If governments around the world take the correct steps then offshore wind power will be able to produce as much or even more electricity than onshore wind farms.