The Future of O&M: Who will do it, and how much will it cost, and how do we avoid the vessel bottle neck?
Carl Erik Gurrik
Fred. Olsen Windcarrier, Oslo, Norway
There are 3,300 wind turbines installed in European waters. A majority are 2.0 – 4.0MW. There are currently 39 vessels (approximately) operating within Europe. Of which 29 have a track-record of working with wind turbines either in the installation or O&M phases. Therefore, the O&M in Europe is a relatively competitive market: There is a wide range of capable vessel and a great deal of experience to ensure that the current fleet of WTGs keep generating.
The time of the 4.0MW WTG is over. From this point forwards almost all installations will be 8MW+. So what does this mean for the O&M fleet? Of the 29 vessels, only 12 have the capability necessary to handle the 8MW+ rated turbines. We must factor in that this group are likely to be required by the foundation installation market, the number of available O&M vessels is reduced further still.
In the early days of the 5.0MW – 8MW+ era, when the number of turbines in the water is small, this situation could be relatively sustainable. However, we must also consider that this O&M market will be in direct competition with the 8MW+ installation market that will almost certainly be more lucrative, and growing - as UK Round 3 opens up, the German market continues to grow, and the French market starts.
Question: Who is going to maintain the next generation of turbines in European waters? Are we facing a vessel ‘bottleneck’? And, are we likely to see O&M costs increase as a result?
An industry-wide analysis of the current European based jack-up fleet’s capability in terms of crane capacity, deck space, water depth capability, and turbine/O&M experience was undertaken. Based on a number of known parameters, the number of viable vessels were reduced according to the known requirements of recent and future offshore wind projects. The number was then further reduced to account for the known requirements of the parallel foundation market.
Lastly, the 8MW+ installation market was compared to the assumed requirements of the same O&M market in terms of the number of predicted interventions and the relative commerciality of the parallel markets.
The findings of this study suggest that although the general perception of the offshore wind jack-up market is that competition is high, only a handful of vessels have the capability to work in the 8MW+ market – from either an installation or O&M point of view. Naturally, the installation market is more commercially interesting than the O&M market. As a result, vessel owners and operators will focus on the more commercially interesting installation market and availability will become problematic for the O&M market.
Ever larger turbines will lead to a large proportion of the European Jack-Up fleet becoming incompatible with the offshore wind market. Of the vessels that can be modified to meet the requirements of the next generation of turbines, a large proportion will naturally gravitate towards the more lucrative foundation market. This will leave a very small number of suitable vessels to service both the growing installation markets and the associated O&M markets.
The conclusion of this situation is that we are headed for a vessel ‘bottle neck’, and O&M costs are likely to increase.
The question remains: How to maintain the next generation of turbines? Are we facing a vessel ‘bottleneck’? And, are we likely to see O&M costs increase as a result?
We are challenged every day on how we should invest for the future. Do we invest in ever larger vessels, or do we upgrade our existing fleet? Or, do both? Can large investment decisions such as these be based on speculation? Do the current markets and the associated subsidy regimes facilitate investment decisions of this kind? These questions are replicated throughout the supply chain, and the lack of clarity at the top will almost certainly result in delays in investment further down which further slows innovation and reduces competitive progress.
Can developers help to avoid the ‘bottle neck’, free-up investment throughout the supply chain by allowing the cost-out of the current generation of turbines before moving on to the next generation of even larger turbines?