Poland's push for offshore wind

leasing activity has ramped up dramatically, with six more auctions planned between 2022 and 2024.

Nevertheless, supply chain constraints are limiting the deployment of these projects. The Jones Act, a World War I era law, requires goods shipped between US ports to be transported by vessels built, owned, and operated by the US – thus creating a major hurdle for offshore wind farms. For the purpose of this law, the location of an offshore wind farm is considered a port and implies that any wind turbine installation vessel would have to be built domestically, leaving the industry unable to tap into existing European ships. The US has only one such vessel under construction which is set to create a bottleneck once all permitted projects start construction. For this reason. Rystad Energy estimates the US will end this decade with an offshore wind capacity close to the 22 GW

Figure 4. US interconnection request mix by ISO. Storage includes standalone battery, pumped-hydro, and other forms of renewable storage. Hybrid includes all storage that is co-located with generation. Other includes non-renewable capacity such as gas, coal, and methane.

Figure 5. US PV panel imports by country of origin.

Figure 6. Polysilicon capacity by country of origin in 2021.

AC

mark.

Policy adds pressure

While not impervious to supply chain constraints and policy, wind and storage could be in for above-average years in the short-term. Solar, however, less so. Delays due to supply chain constraints amid high commodity prices and shipping rates, as well as unfavourable policy have effectively shut down an entire industry in a matter of months.

On the 25 March 2022, the US department of commerce (DOC) decided to investigate a petition by a domestic PV manufacturer concerning composite silicon (cSi) solar PV panels sourced from Malaysia, Vietnam, Thailand, and Cambodia. The investigation claims that Chinese panel manufacturers are circumventing anti-dumping and countervailing (ADCV) rules by offshoring cell and panel assembly processes to the four countries while still using cheap Chinese raw materials. The looming sanctions risk undermining the US solar industry since 84.9% of 2021’s and 99.4% of January and February 2022’s panel imports were sourced from these four countries. The DOC is scheduled to declare a preliminary judgement on the issue in August, with results due by January 2023.

Historically, ADCV tariffs have been applied at different rates to different Chinese suppliers. In the 2012 investigation, the most applied rate was 30.66%, with some rates going as low as 24% and others as high as 250%. If the DOC determines a tariff extension will be imposed because of the latest probe, equipment imported after the announcement of the investigation would be allowed, but tariffs could be applied on imports dating as far back as November 2021. From November 2021 to February 2022, US buyers imported US$1.46 billion worth of panels from the four Southeast Asian countries under investigation. Depending on how the tariffs are applied, Chinese suppliers could be collectively liable to pay between US$365 million and US$3.6 billion in additional tariffs. Chinese panel manufacturers are unwilling to risk such prohibitively high fines so have opted to halt panel exports to the US. According to an industry survey by the Solar Energy Industry Association (SEIA), approximately 80% of respondents said their supply deals have been cancelled in the last month.

Anti-dumping probe and Xinjiang ban

The US PV industry began 2022 in a tough situation even prior to this latest probe. At end-2021, some 7.35 GWAC of solar PV was delayed by more than six months due to rising commodity prices, uncertainty over US federal tax credit extensions, and unfavourable policies. This included the US government’s decision in December 2021 to ban imports containing goods from China’s northwest region of Xinjiang due to human rights abuses committed against the Uyghur ethnic minority. With 40% of the world’s silicon production based in Xinjiang, this policy almost halves the number of panels that can be imported into the US, making it highly disruptive, though less so than the ADCV probe.

Marceli Tauzowski (Poland), Carla Ribeiro (UK), and Marie-Anne Cowan

(UK), Wood Thilsted, discuss the future of Polish offshore wind, considering how government targets will shape the country’s emergence into the sector.

Poland has set itself an ambitious offshore wind target to have 10.9 GW of installed capacity, either operational or under development, by 2027. This is enshrined in the recent Polish Offshore Wind Energy Act that came into force in February 2021.1 As bold as this target is, it raises many important questions; especially given the fact that there are not any offshore wind farms currently operational in Polish waters.

Is there enough space?

At first glance, the Polish Exclusive Economic Zone (EEZ), which covers an area of more than 22 500 km2 (approximately 6% of the total area of the South Baltic Sea) provides a good amount of sea floor for Poland to achieve its energy targets. However, when considering the competition offshore wind faces, with everything from fisheries to wildlife conservation, not to mention other energy sectors, is this a problem? The Polish government has already addressed this need for balance with the introduction of the Maritime Spatial Development Plan, in April 2021. The Plan co-ordinates spatial use of Polish waters, balancing economic and environmental needs and uses. The combined result of this Plan and the Offshore Energy Act is the designation of three offshore wind farm development areas, with fixed boundaries, which are consented and tendered by the government. At present, offshore wind energy can only be developed in these areas. Interestingly, although there are no defined fixed limits for capacity density generally set by the Polish authorities,2 one of the qualifying criteria in the ongoing seabed lease does set a minimum for this metric. That is to say 8 MW/km2 for any wind farm, and this does not include exclusions such as environmentally protected areas, wrecks, or existing infrastructure. A cursory glance would suggest this seems like an excessively high minimum, given the amount of seabed being offered up. Could this be from a desire to maximise the chances of meeting the ambitious 10.9 GW target? So, to answer the first question: ‘Is there enough space?’ – in short, yes.

The installed capacity required to meet the target of the act can comfortably fit in the three identified areas. The more complex question then is, what are the challenges caused by this capacity density threshold of the 8 MW/km2 set by the regulatory authorities? This article explores the overall technical feasibility of this target and opens up a key discussion on the potential challenges.

Figure 1. Offshore wind farm capacity density by country, size, and maturity. A sample of projects representative of each market has been used for the plot. Each sphere refers to a project, and the size of the spheres depicts the size of the project as installed capacity (MW).

Figure 2. Mean and range of wind farm capacity density per market.

Table 1. Selected countries regulatory schemes based on the Baltic LINes publication and WT experience4

Country Development areas Site boundaries Wind farm total rated power Capacity density

BE Fixed Fixed Developer’s decision Developer’s decision

DE Developer’s decision Developer’s decision Developer’s decision Developer’s decision

DK Limited (max) Pre-developed Fixed Limited (min)

NL Fixed Pre-developed Limited (max) Limited (min/max)

UK Developer’s decision Developer’s decision Developer’s decision Developer’s decision

PL Fixed Fixed Developer’s decision Limited (min)

Working out capacity density

To start this exploratory work, Wood Thilsted has reviewed the rules of the application process for Polish seabed leases and set them against five other major European offshore wind markets, looking at observed capacity densities for a comprehensive set of operational projects in these countries.

The review reveals those regulatory mechanisms in relation to exclusivity, including wind farm rated capacity, and capacity density requirements, which vary considerably among the markets analysed. This provides a thought-provoking spread in observed capacity density and size of wind farms, as shown in Figure 1.

However, variations and differing needs across sites and countries means developing generalised conclusions about capacity density is a challenge. From an engineering perspective, maximising array efficiency and therefore energy production is what will drive the design principals around capacity density decisions. In other words, lower capacity density generally delivers lower turbine interaction losses and so maximises energy production.

However, it is not actually that simple. Country siting regulations, as shown in Table 1, vary widely which, combined with the development area available, strongly affect the mean wind farm capacity density of each country. Belgium is a perfect example of this, where space is scarce for offshore wind. Developers therefore need to make the most of the available area, resulting in a higher capacity density. For countries with more seabed available, Wood Thilsted sees more freedom to use larger areas. And, in countries where the decision on wind farm installed capacity stays with the developer, lower mean capacity densities are the norm. The UK is a particularly strong example of this, due to its larger exclusive economic zone (EEZ).

So, what about Poland? By establishing a minimum capacity density for the ongoing lease auction, the Polish government seems to be signalling that its primary focus is on maximising the seabed, in order to achieve the targeted installed capacity for the country. This decision means that Poland may be following the Belgium model, despite the larger EEZ available in this market. However, there is more to it than that. As well as Polish projects having one of the highest turbine capacity densities, these projects are mainly at the upper end in terms of size (area) compared to other operational western European projects. For example, in the UK, projects of a similar installed capacity are being constructed, albeit with a much lower capacity density.

Furthermore, wind farms in Poland are being planned in clusters, where neighbouring wind farms will significantly impact each other. So, what does this all mean? In short, this is something the industry has not really seen before and so may require several technical innovations to meet the challenges.