Offshore Wind Journal 1st Quarter 2017

1st Quarter 2017 www.owjonline.com

Journal

DANES

LOOK BEYOND HISTORICALLY LOW BIDS TO

POST-2020 ENVIRONMENT France plans commercial-scale floaters but Rounds 1 and 2 making slow progress ETI and IRENA recommend greater emphasis on floating foundations

“Offshore wind is the most scalable, low-carbon generation source that can be built close to population centres. The next stage of market growth starts here” Bruce Valpy, managing director and founder, BVG Associates, see page 40

contents

1st Quarter 2017 volume 6 issue 1

06 08

Regulars 5 COMMENT 38 BEST OF THE WEB

Area reports

18

6 Having secured historically low bids for projects in 2016, Denmark is looking at the next stage of development of its offshore wind industry 8 The French authorities have declared plans for a tender for commercialscale floating offshore windfarms even before they have started building fixed foundation windfarms in Rounds 1 and 2 12 2016 saw the UK vote for Brexit: what might the effect of Brexit be on the country’s offshore wind plans?

16 Costs are falling in the UK as the government places offshore wind at the heart of its industrialization strategy

Floating offshore wind 18 IRENA says floating offshore wind could be a game changer

Foundations 20 A mini jacket foundation developed by TWD in The Netherlands with contractor GeoSea could have a number of advantages

Corrosion control 23 Best known for corrosion control solutions for the offshore oil and gas sector, Imenco in Norway has moved into offshore wind

37

Cablelay 24 The Carbon Trust has initiated a competition to find ways to protect cables in windfarms

Class/certification 27 Bureau Veritas has published guidelines for marine renewables, including floating offshore wind

Project focus 28 Burbo Bank Extension was the first offshore windfarm in the world to use new-generation 8MW turbines

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Offshore Wind Journal | 1st Quarter 2017

contents Testing/demonstration 30 Recent weeks have seen a number of developments in the UK and Germany that will enhance the ability of the industry to develop and test new turbine technology

Turbines & turbine technology 33 The global wind turbine market will experience a degree of turbulence over the next few years, says a research and consulting firm

Offshore access/walk-to-work 34 New generation walk-to-work systems can transport equipment as well as personnel and operate at a range of heights

Turbine support vessels 36 2016 was a year of sustained low rates for support vessels in the offshore oil and gas sector and was also a year that saw rates for vessels for offshore wind decline as a result 37 Technology on crew transfer vessels is evolving rapidly, but work on a crew transfer vessel can be very routine, with the risk that complacency can set in

Profile 40 Bruce Valpy, managing director at BVG Associates, says the next stage of market growth is about to get underway

Next issue Main features include: • area reports: United Kingdom, South Korea & Poland • turbine technology • turbine manufacturing • corrosion protection • offshore grid connections • insurance • trenching • project focus.

Front cover photo: A2SEA’s turbine installation vessel Sea Installer recently completed installing turbines on the Burbo Bank Extension offshore windfarm, the first in the world with 8MW turbines

1st Quarter 2017 volume 6 issue 1 Editor: David Foxwell t: +44 1252 717 898 e: david.foxwell@rivieramm.com Commercial Portfolio Manager: Bill Cochrane t: +44 20 8370 1719 e: bill.cochrane@rivieramm.com Head of Sales – Asia: Kym Tan t: +65 9456 3165 e: kym.tan@rivieramm.com Sales, Australasia: Kaara Barbour t: +61 414 436 808 e: kaara.barbour@rivieramm.com Production Manager: Ram Mahbubani t: +44 20 8370 7010 e: ram.mahbubani@rivieramm.com Subscriptions: Sally Church t: +44 20 8370 7018 e: sally.church@rivieramm.com Chairman: John Labdon Managing Director: Steve Labdon Finance Director: Cathy Labdon Operations Director: Graham Harman Editorial Director: Steve Matthews Executive Editor: Paul Gunton Head of Production: Hamish Dickie Business Development Manager: Steve Edwards

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COMMENT | 5

OFFSHORE WIND ENERGY IN A VIRTUOUS CIRCLE

2 David Foxwell, Editor

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016 was in many ways an amazing year for the offshore wind industry as the cost of projects sanctioned in The Netherlands and Denmark fell more steeply than even industry optimists expected.

Even in the US, where the president-elect is a climate change denier and has talked about tearing up the Paris Agreement, several states are pressing ahead with plans for large-scale projects. Despite a few scares along the way, the world did not stop turning in 2016, but it did keep getting warmer. The imperatives for decarbonisation remain as strong as ever, and the sector is never short of things happening.

2017 will see the UK’s second, long-awaited CFD auction, which will take place nearly three years after the first. This is widely expected to be an ‘offshore wind round’. Then there’s the effect of Brexit, and the UK’s much-anticipated industrial strategy, promised this year. It is said to have energy at its heart.

Levels of vessel activity in 2017 may not reflect the upturn, but from 2018 onwards, demand is expected to grow on the back of large-scale projects in the UK and elsewhere.

Outside Europe, other countries such as Taiwan, Japan and India are also showing keen interest in offshore wind and will be encouraged by what they see happening to costs in Europe.

As BVG Associates noted recently, the winning bid of €54.5/MWh for Borssele III and IV by a consortium of Shell, Van Oord, Eneco and Mitsubishi/DGE demonstrated that offshore wind costs appear to have achieved a significant and sustained reduction. A combination of advances in technology, effective supply chain collaboration and favourable finance costs have driven these low prices. As the company noted, it is now vital that the industry continues along this cost-reduction path to unlock additional volume, encourage innovation and reduce the need for subsidy.

BVG Associates’ Giles Hundleby’s analysis of the Borssele III and IV tenders is instructive.

As he notes, the winning bid for Borssele III and IV was 25 per cent lower than that achieved by Dong Energy in July 2016 for Borssele I and II. Firstly, he notes, with Mitsubishi Vestas Offshore Wind as nominated turbine supplier, the project can be assured of the latest and most costeffective turbine technology. Secondly, he notes, whilst Mitsubishi Vestas Offshore Wind and Mitsubishi Corp do not share a strict legal connection, there is enough ‘skin in the game’ from ‘team Japan’ to make it worth everyone’s while keeping the turbines running efficiently throughout their life, not just hitting availability targets to the end of the warranty period. “In the long run, finding the root cause of any problems and fixing them is the most effective approach for overall windfarm LCOE, and this should flow through to lower opex and higher energy production,” he notes. Finally, he says, we have to note that the only major lever available to the winning bidders with enough heft to enable this kind of reduction in cost to be achieved is the weighted average cost of capital (WACC).

With interest rates remaining stubbornly low (and even negative in some countries), it seems like the consortium has found a way to structure their project with WACC of 5 per cent or below, which also probably forms part of the explanation for the even lower bid from Vattenfall at Kriegers Flak.

As he concluded, the good news for offshore wind is that low cost capital can potentially be accessed by bidders on other projects and is technology neutral (within reason). This means that it should not have an impact on the ongoing drive to deliver technology-based LCOE improvements. Indeed, if lower prices unlock additional volume and/or accelerate deployment, low cost capital may drive faster technology development. OWJ

Offshore Wind Journal | 1st Quarter 2017

6 | DENMARK

DANES LOOK BEYOND HISTORICALLY LOW BIDS TO POST-2020 ENVIRONMENT

L

ate 2016 saw Danish Prime Minister Lars Løkke Rasmussen’s Liberal Party form a new cabinet with two other parties in a move aimed at strengthening Denmark’s single-party, minority government. This right wing coalition has many issues to address, among them a new energy agreement to replace the Danish energy agreement, which expires in 2020.

The process of outlining the government’s ambitions for the next energy agreement has begun, and a way forward is expected to become clear by the end of 2017. “One of the big discussions for the post-2020 energy agreement is what kind of technology the government supports,” Martin Bøndergaard, head of policy and analysis at the Danish Wind Energy Association, told OWJ. “Will it essentially be a technology-neutral approach, or will we see technologyspecific tenders for onshore and offshore wind and for

Low prices for Danish offshore wind projects awarded in 2016 have aroused interest around the world, but attention is already turning to the next generation of projects and the auction model that might be used to develop them

ABOVE: Kriegers Flak and Vesterhav Nord/Vesterhav Syd have emphasised how costs have fallen since projects such as Horns Rev 1 (shown here)

Offshore Wind Journal | 1st Quarter 2017

solar? That’s the main question.

“Another issue that the government needs to address is whether it wants to opt for single-site tenders or multisite tenders,” Mr Bøndergaard explained. Multi-site tenders might help reinforce the scale effect that helped drive down the cost of offshore wind energy projects in Denmark and elsewhere in recent months but might place smaller companies at a disadvantage to giants such as Dong Energy.

Another factor associated with the steep fall in the price of offshore wind in Denmark – and elsewhere, such as in The Netherlands – has been the contracting model adopted by the government. Strike prices achieved in Denmark and The Netherlands have been significantly lower than those in the UK, but a simple comparison of winning prices is inappropriate, as policies in each country differ, as do site characteristics. In Denmark, parties bidding into auctions

do not need to pay for grid connection, transmission or project and site development costs. These costs are paid by the government or the transmission system operator (TSO).

This strategy has worked very well to date in Denmark, but Mr Bøndergaard says it is possible that, come 2020, the government might feel that industry is ready to take on the grid connection risk it currently avoids. “I think it’s agreed here in Denmark that there needs to be a consultation on the lessons learned during the three most recent tender rounds so that the best way forward can be determined,” he told OWJ. November 2016 also saw an important agreement reached on a long-running dispute over Denmark’s public service obligation (PSO) support system. Agreement on the way forward paved the way for the recent nearshore windfarms and the 600 megawatt (MW ) Kriegers Flak offshore wind projects. Mr Bøndergaard said

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DENMARK | 7

that the agreement will see the PSO gradually phased out between this year and 2022, thus providing long-term stability for the development of the nearshore and Kriegers Flak projects by Vattenfall.

The Danish model has been a big success but could see changes in the new energy agreement. There have in fact been two Danish models – one typified by Kriegers Flak, the other by the nearshore projects – but both had in common the fact that the government identified the site and conducted the environmental assessments, with the Danish Energy Agency acting as what Mr Bøndergaard describes as a “one-stop shop” for this part of the process, including permitting and planning.

“The difference lies in the fact that the nearshore tenders were multi-site tenders,” he explained. “There were six possible locations for the nearshore windfarms – Vesterhav Nord, Vesterhav Syd, Sæby, Sejerø Bugt,

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Smålandsfarvandet and Bornholm – although only two were selected as only 350MW was stipulated in the tender. The other difference is that the role of the TSO differed between the two models. For the multi-site, nearshore tenders, the TSO was not responsible for grid connection.” For Kriegers Flak and the earlier Horns Rev 3 projects, the grid connection is constructed and paid for by the TSO. Looking ahead, it is possible then that, even though the Danish model for farshore windfarms has been an unqualified success, the model might evolve into one not unlike that adopted for the nearshore projects, if the government decided that industry can safely assume the additional risk involved in being made responsible for the grid connection.

Vattenfall was announced as the developer of the 600MW Kriegers Flak project in November 2016 with a winning bid of €49.9/MWh, only a couple of months after Vattenfall also won the tender for the Danish nearshore project, now approved by the Danish parliament, with a bid of €63.8/MWh. Given the very low price of the winning bid, state aid for Kriegers Flak will be far below the levels expected in the energy agreement.

As to how exactly the Danish tenders have come in at such very low numbers, Mr Bøndergaard attributes much of the steep fall in costs to the scale effect of increased market volume. A lot of discussion on this issue has focused on the role that larger turbines have played, but Mr Bøndergaard sees supply chain actors along the entire value chain benefiting from scale effects and what he called the “volume factor”.

These are forces that are now at work elsewhere in Europe’s offshore wind industry and not just Denmark, he notes. The

Danish model has undoubtedly also had a beneficial effect, and of course Vesterhav Nord and Vesterhav Syd are very close to the shore. With turbines as close as 4km, Vattenfall does not need an offshore substation – you can just bring the array cable strings onshore, which saves a lot of money in the transmission system.

As analysts such as BVG Associates have also pointed out, the sites also have good average wind speed, are reasonably close to potential construction ports and are very close to operations and maintenance ports. The sites are also suitable for monopile foundations but are not so shallow as to make construction difficult. This means that the starting point for the Vesterhav sites is lower than the range of levelised cost of energy for more conventional self-developed sites across different locations in European waters. As BVG Associates also pointed out at the time that deal was struck, under the nearshore model, the Danish Government undertook much of the preliminary development activity. Even though it will pass on some of these costs to Vattenfall, the overall development costs (and risks) are believed to be lower than normal. A further special feature of these Danish sites is that they are long in the crosswind direction and thin in the downwind direction. This means that they can be laid out with (nearly) a single row of turbines resulting in very low wake losses when the wind is in the prevailing direction.

Vattenfall’s fast-growing buying power has also played a role in the low prices bid for both projects, as have low interest rates and the low cost of capital, along with factors such as optimising construction schedules and taking advantage of falling equipment costs and costs throughout the supply chain. OWJ

BELOW: Even though the Danish model for offshore wind has been an unqualified success, that model could change when the next energy agreement enters force

Offshore Wind Journal | 1st Quarter 2017

8 | FRANCE

FRANCE PLANS FOR FLOATERS, BUT ROUNDS 1 AND 2 MAKING SLOW PROGRESS LATE 2016 SAW THE AUTHORITIES IN FRANCE INITIATE A PROCESS THAT COULD LEAD TO A TENDER FOR COMMERCIAL SCALE FLOATING OFFSHORE WINDFARMS IN 2018, BUT CONSTRUCTION OF ROUND 1 PROJECTS FOR BOTTOM-FIXED WINDFARMS HASN’T EVEN STARTED YET

The cost of as yet unexecuted Round 1 projects compares unfavourably with projects that have been awarded more recently elsewhere in Europe

Offshore Wind Journal | 1st Quarter 2017

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FRANCE | 9

W

ith a pipeline of six projects totalling 3 gigawatts (GW) awarded in the space of two years, two French-owned turbine OEMs and significant supply chain commitments, France’s offshore wind programme seemed in good shape at the end of 2014.

But a little over two years later, permits for Round 1 projects have been appealed, the consultation for some is only now getting underway, national turbine OEMs have changed hands and the latest energy plan from the French Government brought only vague targets for more offshore wind.

A third round of tenders is at last going ahead, but with an election looming that could see a centre right government elected, uncertainty abounds. Whatever kind of government France finds itself with later this year, it will need to crack on with the background work that is necessary to identify new zones for offshore wind.

Then there’s the cost of Round 1, the tenders for which were prepared more than six years ago, long before new technology began to drive down the cost of offshore wind as steeply as it has in the last 18–24 months. With a 20-year feed-in tariff north of 170 €/MWh – excluding grid connection – as yet unexecuted Round 1 projects compare particularly unfavourably with projects that have been awarded more recently elsewhere in Europe at or below 70 €/MWh. “Part of that difference is associated with wind conditions at French sites, which are 1 m/s lower than their northernEurope counterparts,” Jérôme Jacquemin, a partner at consultant Everoze in France, told OWJ. “Then there are less favourable ground conditions. Then there is additional cost associated with risk allocation and tax and local content peculiarities.” Added to that, much of the technology selected for the projects, if not obsolete, is dated in comparison with technology to be adopted in recently awarded projects in The Netherlands and Denmark. Then there’s the tender model used for Round 1 and the additional cost that resulted from local content requirements. As if that wasn’t enough, legal challenges launched last year against Round 1 projects at SaintNazaire, Fécamp and Courseulles-sur-Mer – rulings from which are not expected until mid-2017 – mean that, assuming they go ahead, they are unlikely to come on stream much before 2021.

The good news, says Mr Jacquemin, is that the upcoming tender for Dunkirk

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Of the manufacturing facilities planned in France, only the GE (formerly Alstom) plant has been built

(see box), which forms part of Round 3, provides an opportunity to set a new cost benchmark for the French tender model.

Site conditions are as close as they can be to northern European sites that produced such low winning bids in the latter part of 2016, and local content considerations will be much less important. “Dunkirk will set a new cost benchmark in France, which we hope will come close to 100 €/MWh,

‘Competitive dialogue’ for Dunkirk As highlighted elsewhere in this article, in late 2016, the French authorities launched a ‘competitive dialogue’ to select the contractors for a Round 3 offshore windfarm off the coast of Dunkirk. The process will enable the size and location of the windfarm to be determined. Contractors are also expected to put forward proposals that will contribute to economic development in the region. The dialogue also allows other interests – such as the fishing industry – to have a say in the proposals.

The Dunkirk project is for an offshore windfarm of approximately 500MW. The start of the competitive dialogue for this project follows a November announcement about another Round 3 project, of as yet unspecified size, off the island of Oléron on France’s Atlantic coast.

excluding grid connection,” Mr Jacquemin told OWJ. “This will provide a new cost basis from which further de-risking of the tender model can be implemented to narrow the gap.”

But there are other challenges that need to be addressed. In France, he says, the question of marine spatial planning for offshore wind and other forms of marine renewables is “unfinished business”.

Short spurts of work were conducted in 2012 and in 2014. “The latest round culminated in three zones for floating wind in the Mediterranean Sea and one small zone at Groix for a pilot-size floating wind project,” he explained. “However, for bottom-mounted offshore wind, the conclusion of that exercise was primarily that any new zone near Round 1 or 2 projects was undesirable at this stage. In the Atlantic, this ruled out for some time any new project save that lying off Oléron.

In the English Channel, low impact areas were identified, but the same arguments on proximity and collateral damage on public acceptance of Round 1 and Round 2 projects ruled out any new project other than off Dunkirk, so two years on, here we have no specific targets for offshore wind for the three main sea zones, large chunks of favourable seabed locked out until Round 1 or 2 projects have cleared planning approval and two potential sites off Dunkirk and Oléron.

“It is obvious to anyone with some knowledge in this sector in France that long-term development of bottommounted offshore wind at scale in France

Offshore Wind Journal | 1st Quarter 2017

10 | FRANCE

will involve a multi-gigawatt cluster northwest of the current Fécamp project, another south of Boulogne and perhaps additional projects off Saint-Brieuc and Saint-Nazaire,” said Mr Jacquemin.

As it moves slowly towards a new tender model more akin to that in The Netherlands, the French Government needs to find a way to unlock these areas, he says. “In addition, a proper large-scale zoning, sizing and phasing exercise is required. National and local administrations need such a plan to carry out upfront public enquiries and to commission environmental and technical surveys, and transmission system operator RTE needs long-term visibility to optimise and plan the required grid connection infrastructure.

Private-sector investors would also value that visibility.” All in all, he says, cherry picking small sites one after the other has been shown to have its limitations.

Ambitious plans for the industrial facilities required to build turbines and blades in France are also being affected by the uncertainty and by changes in the industry since the Round 1 and Round

Plans for floating offshore windfarms are being advanced even though Round 1 projects with fixed foundations haven’t been built yet

Offshore Wind Journal | 1st Quarter 2017

2 deals were announced. Apart from a factory to build nacelles at Saint-Nazaire, none of the other facilities has – or will – be built until Round 1 and 2 projects have consents. Mid-2016 saw GE roll out the first Haliade 150 nacelles from its SaintNazaire factory, but they were intended for Deepwater Wind’s Block Island offshore windfarm off the east coast of the US rather than a French project.

Mr Jacquemin says that, even if the Round 1 and 2 sites are consented, it is unclear exactly what manufacturing facilities will be built. In response to the local content incentives of Round 1 and 2, industrial commitments were made by Alstom (whose turbine business is now part of GE) and Adwen. For Alstom, this involved the nacelle assembly facility in Saint-Nazaire and a blade manufacturing facility in Cherbourg run by LM, which has also recently been acquired by GE. Adwen planned to build the same kind of facilities in Le Havre but, now owned

by Siemens/Gamesa, it has yet to break ground on the Le Havre facility. GE/LM has yet to build the blade manufacturing facility it planned at Cherbourg, and it is hard to see two different blade manufacturing facilities being built in France at all at the moment.

“Even if Round 1 and 2 projects tick along and Dunkirk is awarded promptly, the lack of strategic planning and vague new-award targets for 2023 beg the question as to whether outstanding commitments will be followed through,” said Mr Jacquemin. The new-award targets he described range from a paltry 500 megawatts to an upper limit of 6 gigawatts.

This vagueness could be interpreted as a stick with which to beat industry, he suggests – bring down costs and we might hold tenders for something approaching the upper end of the range, the French administration seems to be saying.

“In the context of industry consolidation, it’s hard to conceive all of these facilities being built. Which blade manufacturing capacity gets built may depend on what happens in the aftermath of the Siemens/ Gamesa deal, in particular, whether Siemens and other turbine manufacturers decide to continue sourcing from LM. The French Government and administration is a big boat to steer, so changes won’t happen overnight. There is broad understanding between the administration and industry as to what needs to happen now, but a new government could still opt for nuclear power.”

Floaters fast-tracked Late 2016 saw the French environment minister Ségolène Royal unveil the winning bids for two more pre-commercial floating offshore windfarms, bringing the number of such projects awarded to four. It also saw an announcement that tenders could be issued as early as 2018 for commercial scale floating offshore windfarms. Matthieu Monnier, who works for France Energie Eolienne, told OWJ that ‘macro sites’ in the Mediterranean and off Brittany in northwest France were being considered for floating windfarms. Mr Monnier said he expected that, if tenders are released in 2018, projects could be awarded as soon as 2019, after a pre-competitive phase.

The most recent awards for the precommercial floating wind energy projects went to the French and Portuguese utilities Engie and EDPR, with Caisse des Dépôts et Consignations (CDC), Eiffage, Principle Power and GE, which won a bid for the Leucate zone in the Mediterranean, The second went to a group comprising EDF EN with SMB and IFP for the Faraman area off Brittany. This latter group intends to use Siemens 8MW turbines. The other industry teams to win awards were EolMed, led by French developer Quadran, for a demonstrator in the Gruissan zone in the Mediterranean using Senvion’s 6.2M152 turbines and foundations from Ideol, and Eolfi and China General Nuclear, which will build a demonstrator in the Groix region, off Brittany, using GE’s 6MW Haliade turbines.

Interest in floating offshore wind is running at a high level given water depths in France’s Mediterranean cost and expertise in industry that is applicable to floating offshore wind. In January 2017, DCNS, parent company of tidal energy company OpenHydro, announced the creation of DCNS Energies, a marine energy business that will be fully financed by a fund managed

by Bpifrance and supported by Technip and BNP Paribas. It will be majority owned by DCNS and 36 per cent by the Société de Projets Industriels (SPI) fund of Bpifrance and will devote its activity to the industrial and commercial development of three marine energy technologies: in-stream tidal turbines, ocean thermal energy conversion and floating offshore wind. A total investment package of €100 million in equity has been provided by the partners. OWJ

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12 | UK

BREXIT WHAT IMPACT WILL IT HAVE ON THE UK OFFSHORE WIND INDUSTRY?

T

he recent UK referendum vote to leave the European Union (EU) has sent ripples through both political and investment circles, the potential implications of which were addressed by Norton Rose Fulbright late last year.

First and foremost, asked Norton Rose Fulbright, will UK renewable energy policy alter? Under many models for the withdrawal of the UK from the EU (other than using the European Economic Area (EEA) model), the UK would be released from its renewable energy targets under the EU Renewable Energy Directive.

PARTNERS AT LAW FIRM NORTON ROSE FULBRIGHT* ANTICIPATE THAT THERE WILL BE A NUMBER OF IMPLICATIONS FOR THE UK’S FAST-GROWING OFFSHORE WIND INDUSTRY ARISING FROM BREXIT

However, it is highly likely that renewable electricity will form part of the future energy mix.

This is because the indications are that the UK still plans to comply with its national emission reduction targets under the Climate Change Act 2008 and its international climate change obligations (although these obligation will need to be disentangled from those of the EU). On 20 July 2016 (almost a month after the referendum result), the Carbon Budget Order 2016 came into force, enshrining the 5th Carbon Budget covering the period 2028–2032 at an equivalent 57 per cent emission

reduction on 1990 levels into law. In addition to climate change considerations, there are other powerful drivers for renewable energy development such as security of supply and environmental benefits. The secretary of state responsible for the Department for Business, Energy and Industrial Strategy (BEIS), Greg Clark, has made statements supporting offshore wind and recognising that it will have a “big role to play”.

Following announcements regarding the shape of the second contract for difference (CFD) allocation round, which will open in April 2017, it appears that offshore wind will be the principal beneficiary of that funding round.

Will renewable energy support schemes alter? The UK is in the process of moving from one support mechanism to another. The old mechanism (that will continue to apply to projects that have already been accredited under it) is the Renewables Obligation (RO) (a ‘green certificate’ scheme).

It is being replaced with CFDs, a revenue stabilisation

UK | 13

mechanism that, in broad terms, fixes revenue at a contractual strike price, which are allocated competitively.

For Brexit to take effect, the European Communities Act 1972 (ECA), which provides for the supremacy of EU law, will need to be repealed. Repealing the ECA would bring an end to the constitutional relationship that exists between EU and UK law.

Moreover, the vast amounts of secondary legislation that have been passed with the objective and justification of implementing EU law would have to be considered by Parliament. The eventual repeal of the ECA will not affect the CFD legislation, which has the Energy Act 2013 as its enabling legislation. However, because aspects of the Renewables Obligation Order 2015 (ROO), which governs the RO, rely on the ECA as the primary implementing legislation, the UK Government will need to take some positive action upon repeal of the ECA to preserve the legal basis for the ROO. Whilst this is a formality, it is

nevertheless important that the UK Government manages the repeal of the ECA so as to preserve rights to support under the RO. The ROO is not the only secondary legislation affected in this way. Given the volume of legislation affected, the government is considering a Great Repeal Bill to grandfather existing regulatory regimes, retaining EU legislation that could then be amended or repealed as appropriate at a later date.

In many Brexit scenarios (other than the EEA model), the UK will be released from state aid rules, which have been influential in shaping the RO and CFD support regimes.

Both regimes have already received state aid clearance, and therefore Brexit is unlikely to have any immediate impact.

However, if the UK were no longer bound by EU state aid rules, the government may have more freedom in both the design and phasing out of renewable energy support regimes. The UK support regimes would, however, be open to bilateral responses from

countries that might believe that any subsidies run counter to principles under the WTO regime, although WTO rules restrict the actions that WTO members can take to counter the effects of subsidies. In the longer term, investors will also wish to consider how any changes in law introduced as a result of Brexit will affect the project’s power purchase agreement and/or CFD. However, this analysis will only be able to be carried out once any such changes are proposed.

Will EU merger control restrictions still apply? The UK offshore wind market has historically attracted a lot of interest from overseas investors. Merger control will be an important consideration for prospective investors in the UK offshore wind market.

If the UK remains part of the EEA, rules equivalent to those under the EU Merger Regulation would continue to have potential application to mergers, acquisitions and joint ventures in the UK under the EEA Agreement. In any other scenario, EU-based investors

in the UK market would need to consider the application of UK merger control rules. In some cases, both sets of rules might apply.

How will Brexit play out under the financing documents?

An offshore wind project with an existing funding commitment from both EIB and commercial lenders is unlikely to be in breach of its credit agreement directly as a result of the referendum vote or indeed the eventual withdrawal of the UK from the EU. It is unlikely that a specific provision relating to the UK’s continued membership of the EU is included in the documentation. However, investors and funders should monitor indirect triggers, which are often included in credit agreements, and, depending on how withdrawal negotiations play out, may be triggered at a later date. For example, many credit agreements contain material adverse change clauses that consist of representations or events of default relating to an event or circumstance (for example, a change in law), which has (or is reasonably likely to

It is likely that, once Brexit takes effect, the environmental standards applicable to offshore wind developments in the UK will change significantly

14 | UK

have) a material adverse effect (MAE). The drafting of these varies widely and is often heavily negotiated, so whether a MAE is triggered by the eventual withdrawal of the UK from the EU will depend on the terms of that particular clause. This can often lead to problems in interpreting provisions of the finance documents themselves.

At the time of writing, there has been no change to English law as a result of the Brexit vote.

However, it is anticipated that regulatory change will follow in the medium to long term as the UK seeks to decouple itself from the EU. As a result, lenders will also be monitoring whether any change in law would render it unlawful for a lender to perform any of its obligations under the financing documents or fund or maintain its participation in the loan, triggering a mandatory pre-payment.

How will Brexit impact EIB funding? EIB investment has played an important role in the construction of offshore windfarms in the UK. Projects that are already funded will need to examine the terms of their credit agreements to establish the impact of Brexit.

These contracts may include provisions requiring compliance with EU law, which exposes the offshore windfarm to the risk of regulatory mismatch to the extent that the UK and EU regulatory regimes diverge. The more significant implications may be for projects that have not yet secured financing.

In the short term, as an EU member state, the UK is still a shareholder of and contributor to EIB. In the longer term, however, EIB funding will depend on the terms of the UK withdrawal settlement and the extent to which the investment opportunity furthers EU policy.

EIB does invest outside of the EU and the EEA, for example, investing in renewable energy projects in South Africa.

How will performance under project contracts be

EIB investment has played an important role in the construction of offshore windfarms in the UK

affected? There is a possibility that the outcome of withdrawal negotiations results in some restrictions on the free movement of people, goods and services between the EU and the UK. Depending on their nature, such restrictions may affect future offshore wind projects in the UK but might also impact operational projects, for example, where technicians and components come from outside of the UK. Many operation and maintenance contracts and some engineering, procurement and construction contracts contain ‘change in law’ provisions that might be triggered as a result. Some such clauses refer to a change in law that affects the scope of the contractor’s services (so may not be affected by Brexit), but others just talk about causing the contractor additional cost (and so might be triggered).

How will contractual payments in euros be affected?

Since the referendum vote, the pound devalued dramatically against the euro, making eurodenominated contracts more expensive for UK offshore wind.

Where a project is incurring costs in euros but is receiving revenue in pounds, lenders will very likely have required the project to have hedged a proportion of that exposure at financial close for the term of the debt. The project’s exposure is therefore only in respect of any unhedged costs. This issue is particularly relevant to future projects where

Offshore Wind Journal | 1st Quarter 2017

a significant proportion of supply and instalment contracts are likely to be denominated in euros.

A mitigating factor will be the extent to which those elements can be sourced from within the UK. Will there be any impact on an offshore windfarm’s development consent? Consents for offshore windfarms between 1MW and 100MW are granted pursuant to section 36 of the Electricity Act 1989 and those over 100MW pursuant to the Nationally Significant Infrastructure Project (NSIP) regime under the Planning Act 2008. ‘Development consent’ is the term given to consents granted under the NSIP regime. Both forms of consent are granted pursuant to domestic legislation, and as such, existing consents will not be affected by Brexit.

In respect of future applications for consent, the main potential impact may be to the requirement to undertake EU-derived environmental impact assessments (EIAs).

While international treaty obligations make it likely that the government will seek to maintain a requirement for EIAs as part of the UK planning system, depending on the terms of the UK’s withdrawal from the EU, the government may have scope to alter the assessment process to suit circumstances in the UK. This may result in fewer obligations on developers and

planning authorities if the thresholds at which an EIA is required are increased.

Will there be a change to the environmental standards the project will be required to comply with? It is likely that, once Brexit takes effect, the environmental standards applicable to offshore wind developments in the UK will change significantly. Of particular relevance is the Habitats Directive 1992 and the Birds Directive 2009 (the EU Nature Directives), which require that specified sites containing certain species and their habitats are conserved. The EU Nature Directives require offshore wind developments that are likely to have a significant effect on protected sites to undergo assessment procedures to determine any relevant safeguards that should be put in place. It is likely that the EU Nature Directives will cease to apply to the UK once Brexit takes effect.

As the EU Nature Directives have been implemented in the UK by domestic legislation such as the Offshore Marine Conservation (Natural Habitats) Regulations 2007, the Conservation of Habitats and Species Regulations 2010 and the Wildlife and Countryside Act 1981, once Brexit has taken place, Parliament may decide to water down or repeal them altogether. It is important to emphasise that, until Article 50 has been triggered and the ensuing two-year negotiating period has expired, environmental legislation derived from European law will continue to apply. OWJ *Nicholas Pincott, Rob Marsh, Mark Simpson, Kathryn Emmett, Lucy Bruce Jones This article is based on an edited version of an article by the above-mentioned.

The full article can be found at: http://bit.ly/2jrZYTa

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16 | UK

STEEP FALL IN COSTS

SEES OFFSHORE WIND EMBEDDED IN INDUSTRIAL STRATEGY

A

report published on 24 January reveals that the cost of energy from offshore wind has fallen by 32 per cent since 2012 and is now below the joint UK government and industry target of £100 per megawatt hour (MWh) four years ahead of schedule. The report shows high industry confidence of continued rapid cost reduction to below levels set by any other large-scale, lowcarbon energy source.

The target, set in 2012, was expected to be met by 2020, but windfarms given final investment decision in 2015/16 are already achieving prices lower than this target. This rapid reduction is tracked in the third annual Cost Reduction Monitoring Framework report, delivered by the Offshore Renewable Energy (ORE) Catapult on behalf of the Offshore Wind Programme Board. The industry is now focusing on further cost reduction, growth and job creation, says the report.

UK Energy Minister Jesse Norman said: “The UK’s leadership in offshore

The government in the UK is to commission a report into how it can reduce the cost of green energy as part of its long-awaited industrial strategy, but offshore wind costs are already falling quickly, as a new report demonstrates

wind clearly demonstrates that it is an attractive destination for renewable energy investment. This growing industry will be an important part of the government’s new industrial strategy, and will be underpinned by £730 million of annual support for renewable energy

over the course of this Parliament.

“Thanks to the efforts of developers, the UK’s vigorous supply chain and support from government, renewables costs are continuing to fall. Offshore wind will continue to help the UK to meet its climate change commitments, as well as delivering jobs and growth across the country.”

Co-chair of the Offshore Wind Industry Council Benj Sykes said: “Offshore wind is a big success story at the very heart of the UK’s industrial strategy. The industry is cutting costs much faster than predicted, while creating thousands of jobs and stimulating investment nationwide. But this is a story that is just beginning. We remain committed to delivering further significant cost reduction, while working in partnership with government to put in place a sector deal and build a sustainable industry that will benefit the UK for decades to come. Our industry’s goal is to be cost competitive with other generation

Long-term certainty from policy framework had led to important new investments, such as Siemens’ turbine blade plant in Hull

Offshore Wind Journal | 1st Quarter 2017

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UK | 17

Supply chain plans required under the contracts for difference process are delivering significant growth for UK manufacturing

sources, and this new data shows that ambition is realistic and that we are well on the way to achieving it.”

Offshore wind costs have fallen sharply through the adoption of larger turbines, increased competition and lower cost of capital. Projects are reaching a final investment decision in 2015/16 with an average levelised cost of energy of £97/ MWh, compared to £142/MWh in 2010/11.

The report also revealed that UK content and jobs are a significant focus for the UK’s offshore wind sector, with the industry working hard to maximise its UK economic benefit. Supply chain plans required under the contracts for difference process are now delivering significant growth for UK manufacturing, and the report identifies further potential to increase both UK content and jobs through a more co-ordinated approach to industrial strategy.

The report was published as the UK government said it wants to find ways to further reduce the cost of green energy, including from offshore wind, but reconfirmed that reducing emissions is “settled policy.” It also wants to “closely connect” energy policy with opportunities for manufacturing and job creation.

In a Green Paper launched on 23 January 2017, the government set out a road map to minimise business energy costs. To do this it will commission a review of the opportunities to reduce the cost of achieving decarbonisation goals in the power and industrial sectors. The review will cover how best to support greater energy efficiency, and examine the scope to use existing instruments to support further reductions in the cost of offshore wind once current commitments have been delivered. It will also examine how the government can best work with Ofgem to ensure markets and networks operate as efficiently as possible in a

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low carbon system.

“While there is a clear role for the government in energy policy, markets are also crucial, inventing and spreading new techniques for saving energy, new and more efficient means of energy generation and storage, and new ways to finance clean technologies,” said the Green Paper. “It is the private sector that will ultimately be the driving force behind our low carbon economy.”

The report said the transition to lowcarbon – and the securing of energy supplies – “must be done in a way which minimises the cost to business and domestic consumers.” It noted that although energy costs on average account for 3 per cent of UK business expenditure, the impact is uneven. There are 15 sectors in the economy – including steel, chemicals, glassmaking and ceramics – where energy costs represent more than 10 per cent of total business expenditure.

“Subsidies and other forms of state support have played an important role in creating markets for new technologies and driving down their costs. But it is important that we move steadily to an operating model in which competitive markets deliver the energy on which our country depends,” said the Green Paper, noting that in renewable technologies, such as offshore wind, the long-term certainty of the policy framework had led to important new investments, such as Siemens’ turbine blade plant in Hull, creating a thousand new jobs and sustaining a supply chain of smaller businesses servicing the industry.

“The industrial strategy – and the combination of the policy portfolio of the former energy and climate change ministry with the business and industrial strategy brief – allows a more explicit strategic set of connections to be made,” it concluded.

RenewableUK welcomed the government’s commitment to “support

industries of the future” in its modern industrial strategy. This includes delivering affordable energy and clean growth, investing in science, research and innovation, upgrading infrastructure and boosting trade and inward investment.

RenewableUK’s executive director Emma Pinchbeck said: “The Prime Minster has taken a bold step by focusing specifically on innovative new industries where the UK is leading the world, and which are challenging the old order.

That’s exactly what our wind, wave and tidal energy industries are doing by delivering affordable energy and clean growth – key pillars which Theresa May has set out in her bold vision for modern Britain. Moves to increase the use of energy storage and battery technology – one of the most exciting fields which our member companies are pioneering – with the creation of a new research institute will also ensure renewables remain at the forefront of our power generation.

The global renewable energy market is worth US$290 billion a year, so it’s crucial that the final industrial strategy provides a strong sector deal for our wind and marine technologies.”

Scots set ambitious target A new target to deliver the equivalent of 50 per cent of the energy required for Scotland’s heat, transport and electricity needs from renewable sources by 2030 was unveiled on 24 January as part of a key consultation on Scotland’s first energy strategy.

The draft Scottish Energy Strategy sets out a vision for 2050 for Scotland to have a modern, integrated energy system that delivers reliable, low carbon energy at affordable prices to consumers in all parts of Scotland. The strategy will build upon the existing economic strengths of the energy sector in Scotland, while protecting energy security. As well as setting ambitious targets, the draft Scottish Energy Strategy also seeks views on issues including innovation in offshore wind, including floating wind, which the Scottish government says “will play a significant role in positioning Scotland as a world centre for energy innovation.” OWJ

Offshore Wind Journal | 1st Quarter 2017

18 | FLOATING OFFSHORE WIND

ETI AND IRENA RECOMMEND GREATER EMPHASIS ON FLOATING FOUNDATIONS

ADVOCATING FOR A GREATER FOCUS ON FLOATING OFFSHORE WIND, THE ENERGY TECHNOLOGIES INSTITUTE IN THE UK AND INTERNATIONAL RENEWABLE ENERGY AGENCY BOTH SAY THEY BELIEVE THAT FLOATING WINDFARMS HAVE HUGE POTENTIAL

IRENA says researchers should focus on cost and risk reduction in floating offshore wind

Offshore Wind Journal | 1st Quarter 2017

T

he Energy Technologies Institute (ETI) in the UK is recommending more emphasis is placed on floating foundations to access the best offshore wind resources in the UK to help bring costs down further as the International Renewable Energy Agency (IRENA) describes floating offshore wind as a potential game changer. Further highlighting the growing focus on floaters, the Carbon Trust recently launched a series of tenders to assess technology challenges associated with floating offshore wind.

The ETI’s recommendations came as it released data from its research into offshore wind in the UK including a front-end engineering design study into its floating platform demonstration project.

Reflecting on their 10 years of research, development and demonstration into offshore wind, the ETI recommends that more work should be carried out to develop floating offshore wind platforms alongside producing bigger, more durable blades that can be assembled close to site to reduce operational costs.

In waters less than 30m deep, ETI analysis points to fixed foundations offering the prime solution from a cost-effective perspective, but when you go more than 50m deep, floating foundations would provide the lowest cost solutions.

Larger turbine blades also make a difference to the cost of energy, but how they are constructed matters as much as the physical length in reducing capital costs per megawatt (MW) and enabling greater energy yield. Without manufacturing and material improvements, a longer blade will be heavier, and this can negate other performance benefits.

The ETI believes that, if manufacturing solutions can be found to allow for modular assembly close to deployment locations, this can also make a material difference to the operational cost of offshore wind. This was evidenced in its partnership with Blade Dynamics, a UK SME subsequently purchased by GE, that worked on an ETI project to develop larger blade technology through new design and manufacturing concepts by producing blades as a series of subsections to deliver improvements in quality, cost, transportability and performance.

Current developers of larger windfarms can also be constrained by the wishes and needs of multiple stakeholders, which has in the recent past restricted the deployment levels of offshore wind. The ETI believes that, by taking another approach and potentially absorbing consenting costs, this could become a game changer for the UK market by making offshore wind more attractive to investors.

In The Netherlands, for example, consenting costs are absorbed by the government (in July 2016, Dong Energy won a tender for new Dutch windfarms at €72 per MWh), and the ETI says that, if the UK was to follow this model, it has a ready-made solution for a consenting managing agent in The Crown Estate.

Commenting on their 10 years of offshore wind work, Andrew Scott, ETI offshore renewables programme manager, said, “Our work has consistently shown that offshore wind can have a significant role in the UK’s energy mix. To date, costs have come down significantly (approximately 50 per cent over the last 10 years), but we believe

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FLOATING OFFSHORE WIND | 19

they can come down further through the employment of new policy and technology levers.

“Offshore wind is not simply competing with other renewable sources but with other technologies generating low carbon electricity.

From our work, we see that there is a clear and credible trajectory to delivering subsidy-free UK commercial offshore windfarms as part of the UK 2050 energy mix.

“When we started work in this area, we modelled the role of offshore wind in a least-cost 2050 UK energy system to meet the country’s climate change targets. Then, it was seen as a hedging option to fill the gap if other technologies did not progress. But during the last decade, we have seen its role change. It is now a core component of a least-cost balanced 2050 energy system that delivers a low carbon transition alongside new nuclear, carbon capture and storage, bioenergy, gas and offshore renewables (predominantly wind) alongside efficiencies in the heating of buildings and transport fleets, both heavy-duty and light vehicles.

“If industry can find routes to more repeatable manufacture of bigger turbine blades – such as in ‘kit form’ close to site – it could lead to even further cost reductions as well as opening up export market opportunities. But there is also a continued need for the sector to learn by doing. The industry needs to increase its practical experience through even further deployment, development and demonstration of new technologies and learn from this to contain operational costs.

“We have identified that the consenting and approval process should be streamlined, as this can have a negative impact on developers wanting to build larger offshore windfarms. And our work shows that the advancement of floating technology also looks like it matters because it opens up more of the seabed, and we recommend that more emphasis should be placed on floating turbine development, as they should be more economic for high wind, deepwater sites – the best locations to exploit UK resources.”

During 2017, the ETI will be releasing additional technical data and reports from projects delivered across its technology programmes over the last 10 years. It has just released to its website material from its Offshore Wind programme in the areas of concept turbine designs, feasibility studies of tension leg platforms and wind turbine monitoring to help inform the debate in this area in the UK. Describing floating offshore wind as a game changer in a special supplement on the subject in its latest Innovation Outlook report, IRENA said participation from policy makers, investors, researchers and industry is imperative to the success of floating offshore wind.

What the ETI recommends • floating platform solutions should be further de-risked – at the moment, investors and developers still favour fixed foundation solutions • industry needs to continue to increase its practical experience in offshore wind through further deployment and learn from this to contain operational costs – there remains value in learning by doing • there should be greater consistency of consenting and approvals as the deployment levels of offshore windfarms can be restricted by multiple stakeholders, constraining the building of larger windfarms.

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For windfarms in waters more than 50m deep, floating foundations provide the lowest cost solutions, says the ETI

“Policy makers need to accelerate floating-specific project development frameworks to keep pace with technology development, recognising the time scales needed for project development,” said IRENA. “They also need to facilitate maximum private investment, including through continued use of proven mechanisms focused on pre-commercial technology, such as extending support to demonstration plants, and providing sufficient confidence and visibility in future markets.”

IRENA said investors “need to be patient” about returns on investment, and this would demand a deeper understanding of long-term potential and profitability. Researchers should focus on cost and risk reduction across the entire offshore wind project cycle.

This includes whole-system modelling and optimisation, taking well characterised site conditions into account, and learning from wind resource and power-output measurements from early projects.

“Industry needs to continue finding ways to collaborate and share risk and, in the longer term, to consolidate to bring the best technologies together at reasonable total cost and risk. Industry also needs to provide transparency regarding cost and risk to the other stakeholders,” said IRENA. The Carbon Trust has launched tenders as part of a joint industry project supported by the Scottish Government, Dong Energy, E.ON, Eolfi, innogy and Statoil to better understand the anticipated risks and opportunities of developing floating windfarms at commercial scale. Projects include assessments of electrical systems, mooring systems and logistical challenges in large arrays of floating wind turbines. “Floating wind presents an opportunity to harness strong wind resource in deepwater locations, unlocking new markets for offshore wind. However, a number of novel challenges will need to be addressed in order to deploy floating wind turbines at commercial scale. These projects will aim to assess these challenges and identify future innovation priorities for the sector,” said Rhodri James, a manager at the Carbon Trust. OWJ

Offshore Wind Journal | 1st Quarter 2017

20 | FOUNDATIONS

MINI JACKET FOUNDATION

COULD BE COST-EFFECTIVE SOLUTION WORKING CLOSELY WITH CONTRACTOR GEOSEA, THE NETHERLANDS-BASED TEMPORARY WORKS DESIGN HAS DEVELOPED THE DESIGN OF A NEW TYPE OF ‘MINI JACKET’ FOUNDATION THAT IT BELIEVES HAS A NUMBER OF ADVANTAGES COMPARED WITH MONOPILES AND CONVENTIONAL JACKETS

T

he mini jacket foundation is not a new idea, but it could have new applications in the offshore wind industry, says Dutch company Temporary Works Design (TWD), which has been exploring the application of the concept with installation contractor GeoSea. Simon Lembrechts, who works in business development at TWD, told OWJ he believes the concept has a number of

potential advantages for offshore wind turbines. He noted that the size and weight of monopile foundations has been growing to the point where they exceed the capacity of some installation vessels.

Jackets are an alternative to monopiles, but the complexity of jacket fabrication generally results in high foundation costs.

TWD foresees an installation process for the mini jacket (including the flange

for the tower) that starts with the mini jacket acting as the template supported by the jack-up barge and also used as the piling template. Lightweight, inclined piles are driven through the sleeves of the mini jacket, and the piles are connected to the sleeves by a grouted or swaged connection. Once piling has been completed and piles connected, the mini jacket forms the base for the tower.

“One of the biggest advantages of this concept is that you can use a single vessel for installation,” said Mr Lembrechts. “One campaign, with no pre-piling, and you can also use smaller jack-up barges of which there is a large fleet available. It also means that a jack-up can carry more foundations per trip, because the components can be easily stacked onboard. Another advantage is that the mini jacket concept weighs less than monopiles.

“Overall,” he explained, “the concept is less complex than a conventional jacket and lighter than a monopile. Smaller components mean that it is easier to fabricate, and more fabricators are available that can construct it. Smaller components also simplify supply scenarios. The mini jacket is easier to store, and requirements for load-out quays are simplified.”

Another big advantage of the concept is that installation costs are significantly reduced by as much as 30–40 per cent.

The company believes that, as the water depths in which wind turbines are installed, the distance from land over which the jackets have to be transported and the size of turbines all increase, the advantages of the mini jacket concept also increase. OWJ

TWD believes that the mini jacket foundation has a number of advantages compared with large monopiles and conventional jackets

Offshore Wind Journal | 1st Quarter 2017

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CORROSION CONTROL | 23

Oil and gas firm makes breakthrough order in wind power market

L

ate 2016 saw Imenco’s production facilities in Tysvær, Norway, in the process of finalising deliveries of cathodic protection for an offshore windfarm in the UK, not long after it had delivered similar equipment to a 67-turbine offshore windfarm in Germany.

The company has long been a supplier of equipment and engineering services to the offshore oil and gas sector, maritime industries, wind power and aquaculture and has offices at Tysvær and manufacturing facilities at Tysvær and in Ningbo, China, along with offices in Bergen, Lafayette, Aberdeen and Singapore. It provides design and assessment of cathodic protection systems together with Frazer-Nash Consultancy in the UK. By providing design and simulation capability, Frazer-Nash enables engineers to design, assess and optimise cathodic protection systems.

Together with Imenco’s cathodic protection systems and mechanical engineering, Imenco and Frazer-Nash say they can provide customised solutions to protect offshore assets at the lowest possible cost. These services include performance assessments of installed cathodic protection systems, optimisation of cathodic protection system configurations, concept design of impressed current cathodic protection and sacrificial anode-type systems, costbenefit assessments of cathodic

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Best known for its products for the offshore oil and gas industry, 2016 saw Imenco in Norway secure contracts for corrosion protection products for offshore windfarms in the UK and Germany protection solutions and assessment of human factors issues as they relate to operating procedures and practices.

Imenco’s breakthrough order in the UK sees it supplying corrosion protection technology for the 336-megawatt, 56-turbine Galloper offshore windfarm, which is being built off the coast of Suffolk.

Imenco’s scope of supply includes connection clamps and cables to connect the anodes to the foundations, equipment to lift and guide large anode banks into place and remotecontrolled lifting anchors to release the lifting equipment after the loads have reached

their final position.

Noting the fast growth in the offshore wind energy industry in the UK, elsewhere in Europe and in countries such as China, the Norwegian firm adapted its product offering from the offshore oil and gas industry to meet the needs of the offshore wind industry, providing sacrificial anodes for corrosion protection. The anodes are installed and connected to the foundation after the installation of the structure is completed. Imenco’s solutions enable a rapid and costeffective operation completely without the use of divers.

Imenco’s managing director, Geir Egil Østebøvik, said the deliveries to the offshore wind energy industry were “very important to our company” and would be reference projects in the growing market for offshore wind power. “They are especially welcome at a time when our traditional market in the offshore oil and gas industry is going through a very demanding period.”

Earlier in 2016, Imenco secured an NKr500,000 (US$62,500) grant from Innovation Norway to help it transition from the offshore oil and gas industry into the offshore renewables market.

The funds were invested in research and development of new products for offshore windfarms. Imenco also received a similar amount to help it transition into the growing aquaculture industry, enabling it to expand its technical expertise in aquaculture and to adapt existing products to another new market. OWJ

A grant from Innovation Norway helped Imenco transition its corrosion protection offering from offshore oil and gas into the offshore wind industry

Offshore Wind Journal | 1st Quarter 2017

24 | CABLELAY

CARBON TRUST LAUNCHES COMPETITION TO REDUCE LOSSES FROM CABLE DAMAGE THE CARBON TRUST’S OFFSHORE WIND ACCELERATOR (OWA) HAS LAUNCHED A COMPETITION TO FIND AND FUND THE DEVELOPMENT OF TECHNOLOGY THAT COULD MONITOR THE CONDITION OF SUBSEA CABLES TO ENSURE THEY ARE NOT DAMAGED DURING THE LOAD-OUT AND INSTALLATION PROCESS

D

amage to cables in offshore windfarms has long been an issue and one of the major causes of insurance claims on projects. Incidents relating to the installation and operation of high voltage subsea cables are also the most costly cause of financial losses in the global offshore wind industry. Incidents of this type led to insurance claims totalling more than €60 million in 2015, and cable failures are said to account for 77 per cent of the total global cost of offshore windfarm losses.

With this in mind, a new competition led by the Carbon Trust is aiming to solve this challenge by identifying and supporting the development of novel condition monitoring systems for subsea cables. Current solutions are not able to detect and monitor mechanical cable limits with the required accuracy, so the OWA is searching for new systems and technology ideas from complementary industries such as telecommunications, civil engineering, automotive and oil and gas that could be adapted for subsea cable application.

Looking at £213 million (US$260 million) in insurance losses from 28 UK offshore wind claims between 2002 and 2015, 68 per cent were directly due to cable faults occurring predominantly during the construction phase. Condition monitoring techniques used during the installation process have the potential to reduce

Offshore Wind Journal | 1st Quarter 2017

instances of these faults, as they can be used to monitor the cable condition and detect potential issues before they develop into failures. Developing a novel monitoring system could dramatically improve the reliability of offshore wind subsea cable systems by ensuring the

Damage to subsea cables has long been an issue in the offshore wind industry, one that the Carbon Trust hopes to find technical solutions to

cables’ mechanical limits are not exceeded in real time during load-out, installation jointing and windfarm operation.

Carbon Trust director of offshore wind Jan Matthiesen said, “Damage to cables during the installation of an offshore windfarm is unfortunately a common occurrence, which also results in unnecessary expenditure for the industry.

The challenge we face is finding a costeffective, easy to connect and operate, robust and reliable system, which can be used to monitor the condition of subsea cables throughout the cable installation phase. Through this international innovation competition, we are really interested in receiving applications from other industries around the world, which have capabilities in measuring and monitoring physical parameters that could result in cable damage.”

Based on recent experience, submarine cable procurement costs account for up to 7 per cent of total capital expenditure when building an offshore windfarm, with cable installation costing another 4 per cent. Longer cable lengths and more challenging conditions in sites further from shore, as well as new innovations such as floating turbines, will all increase the demand for cable condition monitoring during installation in the rapidly expanding offshore wind industry.

The competition entries will be assessed by an expert panel from the OWA. The Scottish Government and the nine OWA developer partners are providing up to £225,000 to support successful innovative concepts. Concepts that show the most promise could also receive further funding to take them to full-scale demonstration. The competition formally opened on 10 January and closes on 13 February 2017. Applicants can access full details of the competition at: http://bit.ly/2jkhg28 OWJ

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CLASS/CERTIFICATION | 27

CERTIFICATION SCHEME WILL HELP DE-RISK RENEWABLE ENERGY TECHNOLOGY BUREAU VERITAS HAS PUBLISHED A SET OF GUIDELINES ADDRESSING THE NEEDS OF MARINE RENEWABLE ENERGY BUSINESSES AND PROJECTS, INCLUDING FLOATING WIND FOUNDATIONS

P

ublished towards the end of 2016, NI 631 Certification Scheme for Marine Renewable Energy Technologies covers floating offshore wind turbines, current and tidal turbines, including sea and river turbines, wave energy converters and ocean thermal energy converters.

“The marine renewables sector is growing in importance, and the complexities are increasing as the sector continues to mature,” said Matthieu de Tugny, senior VP offshore at Bureau Veritas. “Bureau Veritas is taking a broad leadership position in the development of cleaner energy projects and technologies in the marine and offshore environments. We are helping de-risk these projects through our familiarity with and our capabilities in offshore engineering and knowledge of environmental realities and regulatory requirements for MRE projects.”

Many MRE projects are reliant on

Bureau Veritas provided approval in principle for WindFloat, the floating foundation for offshore wind turbines, and is involved in a number of renewable energy projects

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engineering expertise developed in the offshore oil and gas industry, and this expertise is vital as worldwide interest in floating and submerged MRE applications grows.

“As interest in marine renewable energy is increasingly expanding to options beyond fixed wind turbines, we are working on projects in harsher conditions and with heavier engineering demands drawing on our technical expertise,” said Mr de Tugny.

In April 2016, Bureau Veritas provided approval in principle for WindFloat, the floating foundation for offshore wind turbines, and is involved in a number of renewable energy projects, such as a wind turbine project in the Mediterranean for Principle Power.

Bureau Veritas’s certification covers entire projects, multiple units, type approval, components, concepts, prototypes and series production. In 2015, Bureau Veritas issued guidance notes dedicated to specific technologies, including NI 572 Classification and Certification of Floating Offshore Wind Turbines.

Highlighting the focus on floating offshore wind at classification/certification bodies, Principle Power has confirmed that ClassNK has issued an approval in principle (AIP) for a WindFloat offshore wind foundation designed for deployment in Japanese waters, featuring a 5 megawatt offshore wind turbine.

The engineering work was carried out under contract with Mitsui Engineering and Shipbuilding Co Ltd for a feasibility study performed for New Energy and Industrial Technology Development Organization.

The AIP indicates the WindFloat floating offshore wind foundation is conceptually feasible in accordance with the strict Japanese design and regulatory standards, risks have been properly analysed and that ClassNK is satisfied the engineering for the foundation is suitable for deployment in the offshore environment.

“The AIP from ClassNK added to AIPs

already received from the ABS and Bureau Veritas prove the versatility of the WindFloat design process in adapting to various regulatory standards and local requirements,” said Principle Power chief technical officer Dominique Roddier. The earlier AIPs are for projects off the coasts of the US, Portugal, France and Japan and feature different wind turbines in different environmental conditions under different regulatory regimes.

DNV GL certifies prototype of Siemens’ 8MW turbine DNV GL has awarded Siemens Wind Power a prototype certificate for its 8 megawatt (MW) offshore wind turbine, the SWT-8.0-154.

Prototype certification confirms all relevant safety features on the turbine according to the Danish Executive Order BEK 73:2013 and IEC 61400-22, allowing installation of the prototype to demonstrate its performance.

By erecting the turbine at the test centre for wind turbines in Østerild, Denmark, Siemens is able to perform the measurement campaign for the next phase of the type certification process. “We are pleased to have received the prototype certificate at this early stage, allowing us to install our SWT8.0-154 prototype according to plan,” said Morten Rasmussen, head of Siemens Wind Power Technology. The SWT-8.0-154 turbine is an evolution of Siemens’ SWT-6.0-154 and the SWT-7.0-154 turbines. The main changes from the SWT-7.0-154 to the SWT-8.0-154 are an upgraded generator and electrical system and an advanced control system. The upgrade of the turbine to 8MW was made possible through the introduction of new permanent magnet technology. 8.0MW. OWJ

Offshore Wind Journal | 1st Quarter 2017

28 | PROJECT FOCUS

New gear and new approach to mobilisation for Burbo Bank Extension Installing larger turbines places new requirements on turbine installation vessels, their crew and turbine manufacturers, as the Burbo Bank Extension project highlights. It also saw a new approach to mobilisation adopted by vessel owner A2SEA

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ecember 2016 saw A2SEA’s turbine installation vessel Sea Installer complete installation of the 32 MHI Vestas 8MW turbines on Dong Energy’s Burbo Bank Extension offshore windfarm, this being the first time that 8MW turbines have been installed offshore.

Speaking in late 2016, Flemming Ougaard, CCO at MHI Vestas Offshore Wind (MVOW), described installation of the first V164-8.0 MW offshore project as “a major milestone in the history of MHI Vestas, as well as our business partners”, a sentiment echoed by Claus Bøjle Møller, project director at Dong Energy, who noted that using more powerful turbines was enabling the company to bring down the cost of providing clean energy.

Installing the new, larger turbines is not without its challenges,

The challenges involved in installing the Burbo Bank Extension project weren’t only limited to handling new, larger turbines

Offshore Wind Journal | 1st Quarter 2017

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PROJECT FOCUS | 29

however, as Klaus Holm Nissen, A2SEA’s project manager, explained. “MVOW had their people onboard throughout the process of installing the turbines. “The crane operators and lifting supervisors were also MVOW people. Turbines have steadily grown in size,” he told OWJ, “and they are also getting heavier and taller. This brings new challenges.”

Not long ago, 3.6MW turbines were the new, big thing. When they first came along, some new thinking was required compared to handling 2.0, 2.3 and 3.0MW turbines. MVOW’s 8MW unit has 80m blades, each weighing 35 tonnes, and the nacelle is 20m long, 8m wide and 8m high, weighing approximately 390 tonnes. For the Burbo Bank Extension project, Sea Installer was loaded with four nacelles, four towers and a cassette with 12 turbine blades. This made for a tight fit on the deck of the vessel, on which lifting gear, tools, containers and ancillary equipment needed to be accommodated.

From a transport and installation perspective, there are similarities between Siemens’ 6MW (now 7MW) turbine and the MHI Vestas 8MW, says A2SEA. Dig a little deeper, though, and the differences begin to surface. To understand them, it helps to have seen more than one installation project in action, but the general principles are relatively simple.

Historically, however, the blade-handling process for the two manufacturers’ turbines has been completely different, because where Siemens handles its blades individually, MVOW loads blades via a cassette that requires two cranes for loading. The cassette with the 8MW blades holds three stacks of blades, each with four turbines in it, making 12 in total. In both cases, blades are handled using a lifting tool. But while the orientation is the same, the turning of the blade is different. The MVOW blade is horizontally oriented, whereas the blade for a Siemens 6MW is vertical because the ‘S’ yoke lifting tool handles the blade horizontally. The Vestas yoke is more like a forklift in its approach.

The cassette approach means that, for sea fastening, the vessel only requires a substructure into which the cassette can fit. This is in contrast to a Siemens blade stack where the sea fastening is a larger structure that remains in place throughout the project, with the blades being moved in and out as required. Siemens has also optimised the handling process for nacelles. A transport frame remains in place underneath the component from the factory to the vessel and out to the site, returning to the factory once the installation is complete. The frame has a low centre of gravity, meaning it is very stable on deck even in rough seas. In contrast, MVOW uses a road transportation frame that caters both for onshore and offshore nacelles, so sea fastening that uses more steel than the simple four-corner castings and a lashing are needed.

Mr Holm Nissen said that, despite those challenges, A2SEA made excellent progress throughout the project, despite having to work with a lot of new, specialised lifting equipment for these large components. Another challenge, apart from the size and weight of the components, was the seabed in the area. With a lot of clay and sand, as well as some silt, it was a tricky task to jack up securely.

“That kind of surface composition can be very sticky, which initially had us thinking we might have problems retracting the legs,” he said. “But it didn’t turn out to be much of a problem. There were, of course, some extended pre-load periods in order for us to compress the soil sufficiently and make sure it was able to support the vessel.”

In contrast, said Mr Holm Nissen, manoeuvring the vessel in the area was relatively straightforward. “We used the same vessel for West of Duddon Sands, gaining experience of the transit route and

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The cassettes used to store blades for the 8MW turbines can be seen on the deck of Sea Installer in this image

the surrounding seas. Returning to Belfast Harbour did, however, require both sophisticated dynamic positioning equipment (Sea Installer is a DP2 class vessel, so was well suited to meeting this challenge) and real skill on the part of the ship’s master because the seabed there was specially prepared to enable us to jack up at the quayside. The existing structure of the seabed was unsuitable, and we needed to place the vessel’s feet in the exact same spot – with a centimetre level of accuracy – in order to use the new structure and load the vessel.”

Mr Holm Nissen said the load-out was also very much a local operation. Mobilisation was performed at the Cammell Laird yard in Liverpool, where MVOW’s new blade stack system required a different approach to sea fastenings. A2SEA also had a site office in Belfast, which was manned around the clock. It was also the first time A2SEA had worked with MHI Vestas.

Jens Nielsen, head of procurement at A2SEA, told OWJ that this kind of local mobilisation had been a clear step forward in bringing projects and jobs to the region. “Mobilising our vessels for the Dudgeon and Burbo Bank Extension offshore windfarms were our first large-scale mobilisations in the UK,” he explained, “and were accompanied by a long list of firsts from both planning and logistics points of view.”

The mobilisation choices for the Dudgeon and Burbo Bank Extension projects fell on two shipyards: Cammell Laird in Liverpool and A&P’s Tyne yard. Each yard was contracted to provide more than 15,000 man hours each – a total of more than £5 million of contracts. “Of course, we have worked with shipyards in a variety of contexts before, but these two projects were significant because they mark an evolution in our overall approach to mobilisation,” Mr Nielsen explained.

“Normally, A2SEA retains full control over its mobilisations, dividing the project into a number of deliveries. For the Dudgeon and Burbo Bank Extension mobilisations, however, we departed from this approach, offering the entire process for tender as a single task and sourcing the manufacture, delivery and fitting of the sea fastenings from each yard.”

Asked if the new approach had worked well, Mr Nielsen said the nature and extent of the associated learning curves differed from yard to yard, but by and large, the new approach seemed to have paid off.

Sea Installer’s next project is turbine installation on the 580MW Race Bank offshore windfarm in the UK, also for Dong Energy.

Installation is due to start in early May 2017. OWJ

Offshore Wind Journal | 1st Quarter 2017

30 | TESTING/DEMONSTRATION

ORE CATAPULT

launches technology demonstration competition Recent weeks have seen a number of developments in the UK and Germany that will enhance the ability of industry to develop and test new turbine technology

T

he Offshore Renewable Energy Catapult in the UK is to run a competition for SMEs to gain access to its 7 megawatt (MW) Levenmouth offshore wind demonstration turbine to prove and commercialise innovative new sensing technologies. In a programme co-funded with the Scottish Government, the Catapult is developing a digital clone of the Levenmouth offshore wind turbine (CLOWT), fitting sensors to its blades, tower and substructure to monitor its behaviour in realworld conditions.

In parallel, it will provide the opportunity to a number of emerging technology developers to demonstrate and validate their latest innovations alongside existing best-in-class products. Entrants to the competition will be asked to propose sensor technology that can help with the monitoring of blades, drivetrains and foundations, essential to understanding the operational environment and further bringing down the cost of offshore wind. A lack of access to demonstration facilities has been identified as one of the major blockers to innovation and resulting cost reduction in offshore wind. It is believed that this will be the first time SMEs have had such an opportunity to gain access to a next-generation offshore wind turbine.

Fraunhofer IWES will use a prototype of Adwen’s AD 8-180 offshore wind turbine to help accelerate certification testing

Scottish Government minister for business, innovation and energy Paul Wheelhouse said, “Recent rapid growth in offshore wind brings with it the need for the sector to rethink how large megawatt turbines behave and to target lower costs through better design. Supported by the Scottish Government, this project lets SMEs gain access to ORE Catapult’s Levenmouth demonstrator turbine, helping them to better understand the challenges of operating in an offshore wind environment and drive forward further innovation in the sector.”

ORE Catapult senior partnership manager Cian Conroy said, “The continued growth of the offshore wind industry is providing opportunities for companies from sectors as diverse as

Offshore Wind Journal | 1st Quarter 2017

marine, oil and gas, aerospace and power generation. The challenges of operating in the hostile and complex offshore environment require innovative technology solutions, and through demonstration at Levenmouth, we can help the very best to accelerate their development and route to market.”

Early 2017 was due to see the Fraunhofer IWES research institute initiate operations at a new test site in Bremerhaven following a €18.5 million grant from Germany’s energy ministry. The facility will make use of a prototype of Adwen’s AD 8-180 offshore wind turbine. Testing is due to get underway at the facility this spring. Fraunhofer IWES said the Adwen turbine will also be made available to other research partners as a

research platform.

In a statement, Fraunhofer IWES said, “Comparison of field survey results with the data obtained on the largescale test rigs will significantly expand the opportunities for further optimisation of measuring and testing methods as well as risk mitigation for new turbine designs.” Luis Álvarez, an executive at Adwen, said Fraunhofer IWES’s DyNaLab would allow the company to “exhaustively validate” its technology, resulting in great confidence about the optimal performance and reliability of the turbine. “Research and development are key for further reducing the cost of offshore wind energy,” said Uwe Beckmeyer, parliamentary state secretary at the Federal Ministry for Economic Affairs and Energy. He said that, in making the grant, the ministry was “making a contribution to strengthening the role of offshore wind energy as an important pillar of the energy transition”.

Certification tests in the field usually require the operation of a wind turbine over the whole spectrum of wind conditions. The new facility will enable conditions to be reproduced exactly in the lab, making it possible to conduct certification measurements with a very high degree of accuracy and reducing the time needed for field test campaigns. This will help reduce development risks for new turbines.

BAM Infra says good progress is being made on the gravity base foundations for the 41.5MW Blyth offshore wind demonstration project in the UK. The lower shafts have been placed, and the roof panels are about to be mounted at the Neptune dry dock in the northeast of the UK. Five foundations are being built for 8.3MW turbines from MHI Vestas. OWJ

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TURBINES & TURBINE TECHNOLOGY | 33

GRID CONNECTION ISSUES

COULD SEE TURBINE MARKET PEAK IN 2019 The global wind turbine market will experience a degree of turbulence over the next few years, rising steadily from US$76.54 billion in 2015 to US$81.14 billion in 2019 and dipping to US$71.21 billion in 2020, according to research and consulting firm GlobalData

A

ccording to GlobalData’s latest report, technological development has paved the way for more effective and reliable equipment and machinery, making wind one of the most reliable sources of power in the energy market. The steady growth of the wind energy market up to 2019 will be fuelled by the falling cost of wind power generation, financial incentives by a growing number of governments and growing environmental concerns.

Swati Gupta, GlobalData’s analyst, said, “Despite initial yearon-year growth during the forecast period, the expiration of Production Tax Credits (PTC) in the US market in 2020 will have a negative impact on global wind turbine installation and market value in the same year. The PTC for wind energy (which applies almost exclusively to onshore wind in the US, at least for the time being), which pays US$23 per megawatt hour (US$0.023 per kilowatt hour), will remain until 2016, followed by incremental reductions in value for the years up to January 2020.” In terms of regional market share, China is set to continue its dominance of the sector throughout the forecast period and will be responsible for 26 per cent of the market in 2020, a long way ahead of second-place Germany with 10 per cent.

Of greater interest to the offshore wind industry are remarks Mr Gupta made about grid connection and its bearing on the market: “Upgrading electricity infrastructure to meet future transmission and distribution demands will be a major challenge for wind power development,” he said. “Existing grid infrastructure is insufficient, and there is an urgent need for modifications to be made to the existing grid and regulations to accommodate wind power.

Development of grid infrastructure requires massive investment, in terms of financial resources and time, which could reduce the market’s medium-term growth.”

Recent developments in the offshore wind industry have seen Areva complete the sale of its stake in Adwen, the joint venture between Areva and Gamesa. Areva described the sale, which became necessary as a result of the deal between Siemens Wind Power and Gamesa last year, as “part of the transformation plan undertaken by Areva to refocus its business on nuclear fuel cycle activities”. Areva said commitments made as part of the tender process for offshore windfarms in France will remain borne by Adwen. In an announcement on 15 September 2016, Gamesa said it would acquire Areva’s 50 per cent share in the joint venture for €60 million. The deal comes months after a merger was announced between the wind power business of Siemens and Gamesa. When Siemens and Gamesa agreed their merger in

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June 2016, they specified that Areva had three months to decide whether it wanted to buy out Gamesa’s 50 per cent Adwen stake or sell it to them or another buyer.

Dong Energy has placed a contract with MHI Vestas Offshore Wind for the 450 megawatt (MW) Borkum Riffgrund 2 project in Germany. The record-breaking order is the largest ever for MHI Vestas. The V164-8.0 MW turbines – rated with a capacity of 8MW – will utilise the turbine supplier’s ‘MAX Power’ mode.

Siemens has confirmed that it has been awarded a contract to provide the turbines for the Rentel offshore windfarm in Belgium.

The customer is Rentel NV, part of the Otary partnership, a conglomerate of leading specialists from the Belgian renewable energy industry including investment and development companies.

Siemens will supply, install, commission and service 42 SWT-7.0154 direct-drive wind turbines.

Senvion ended 2016 with its highest ever quarterly order intake.

Its total order intake in 2016 was €1,304 million. The company said another €241 million worth of conditional orders were expected to become firm orders in the first half of 2017. In the final quarter of the year, Senvion secured a number of international contracts. OWJ

MHI Vestas Offshore Wind’s contract for Borkum Riffgrund 2 was its third from Dong Energy for V164-8.0 MW turbines

Offshore Wind Journal | 1st Quarter 2017

34 | OFFSHORE ACCESS/WALK-TO-WORK

CARGO, VARIABLE HEIGHT

AND FOOTPRINT DRIVE DEVELOPMENT OF OFFSHORE ACCESS SYSTEMS MANUFACTURERS OF OFFSHORE ACCESS GANGWAYS SAY CLIENTS ARE LOOKING FOR SYSTEMS WITH GREATER CAPACITY – INCLUDING TRANSFERRING EQUIPMENT – AND THE ABILITY TO WORK AT A RANGE OF HEIGHTS WHILST HAVING A MINIMAL FOOTPRINT

W

alking to work across a gangway has become commonplace for technicians in the offshore oil and gas and offshore wind industries.

Early, first-generation systems provided the ability to transfer personnel from crew transfer

vessels (CTVs) and service operation vessels (SOVs), but a new generation of walk-towork technology has recently been introduced that enables technicians and their equipment to be transferred from a suitably sized vessel direct to a turbine or other offshore structure, such as a substation.

The ability to transfer personnel at a range of heights is an increasingly important feature of offshore access systems

Offshore Wind Journal | 1st Quarter 2017

Speaking to OWJ in January, Ben Webster, managing director of Osbit in the UK, highlighted the growing need to transfer equipment as well as personnel, whilst maintaining system compactness on deck. The other important trend in the walk-to-work segment that he highlighted is the need to be able to transfer personnel and equipment at a range of heights.

“The height at which transfers need to be undertaken can vary significantly,” Mr Webster told OWJ. “It depends on the height of the turbine or substation. Large tidal variation is not uncommon in the offshore wind sector either, so increasingly, you need to be able to provide stepless transfer and enable tools and other

equipment to be transferred.

This has led to the development of more capable systems that incorporate elevators and a tower within which an elevator is housed, along with stairs for emergency purposes.

There are a growing number of standardised walk-to-work systems on the market, but there is a growing demand for customised systems too. An example is a P-12R gangway that Osbit delivered to Dutch company Van Oord in 2016 for installation on the heavy-lift unit Svanen. The vessel has been initially deployed to support construction of the Burbo Bank Extension windfarm off the northwest coast of the UK. Osbit’s tailored offshore access system helped to streamline operations, enabling technicians to safely and reliably access the transition pieces in an area with significantly wide tidal range.

To overcome this challenge, Osbit’s engineers applied a roller system to allow vertical movement of the gangway without operator intervention, allowing the system to adjust to tidal conditions automatically.

The P-12R access system was also fitted with a swivelling end step to enable safe access, even when the gangway is not facing directly onto the transition piece’s boat landing access ladder, and enable Van Oord to safely transfer personnel in a range of offshore weather conditions.

New access systems

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OFFSHORE ACCESS/WALK-TO-WORK | 35

continue to enter the market, among them Van Aalst’s SafeWay walk-to-work access system, testing of which was completed at the end of 2016.

Early 2017 is expected to see The Netherlands-based Safeway begin demonstrating the capability of the system under the terms of an agreement with Assodivers Group to install the motion-compensated offshore access system on Aethra, a 94m construction support vessel with accommodation for 87 people. Safeway says the system’s roll compensation technology will provide yearround workability in North Sea conditions. The company also highlights the system’s 10m height-adjustable mast, which will ensure that all required landing heights can be safely reached with a level gangway. In addition to slewing, luffing and telescoping, Safeway introduces a fourth motion actuator, an independent roll compensation system at the bottom of the pedestal. With vessel rolling being the biggest constraint for conventional gangways, this provides improved workability whilst maintaining similar safety margins. The 10m elevation capacity of the gangway increases the number of installations on which a landing can be made.

Among the latest developments from Ampelmann in The Netherlands is the N-type gangway, which has been designed specifically for work in adverse environmental conditions. Late 2016 saw Ampelmann start the assembly phase of an Ampelmann N-type motion compensated gangway system that is capable of working in extreme conditions in temperatures as low as -28°C). It can also handle high levels of vibration and vessel motions whilst maintaining a safe, efficient and reliable means of transfer.

The N-type will be installed on one of Sakhalin Energy

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Walking to work across a gangway such as this one from Uptime in Norway has become common practice on SOVs

Investment Company’s new icebreaking standby vessels due for delivery in 2017. Production of the components for the N-type started last summer.

Oscar Calkoen, project director for the N-type, said delivery of the new gangway is key for Ampelmann’s innovation strategy. “The new technology required to winterise this system has been a joint effort with existing and new suppliers,” he said.

Uptime International in Norway has announced details of new contracts for walk-to-work gangways for the offshore wind industry. It recently signed contracts for two walk-to-work systems with the ability to transfer personnel and cargo in rough weather conditions. Østensjø Rederi acquired an Uptime 23.4m active motion-compensated gangway that was installed on its multipurpose supply vessel Edda Fjord, which was already working in the walk-to-work market, in late 2016. The second contract was from GC Rieber for another Uptime 23.4m gangway, which will be installed on its vessel Polar Queen. Polar Queen has been awarded a contract by Senvion to work on the Nordsee One offshore windfarm, supporting turbine commissioning.

Uptime has also entered the rental market with a range of gangways. Its rental stock includes 8m, 12m, 15m, 23.4m, 26m and 42.5m units.

The first rental contract for an Uptime 23.4m active motioncompensated gangway was with Norwegian shipowner Eidesvik Offshore for the vessel Acergy Viking, which has a nine month contract for Siemens Wind Power. Uptime has also contracted a 23.4m heave compensated gangway with Solstad Offshore, which has been awarded a 23 month plus option contract for Rem Installer, which will be working for Dong Energy Wind Power on the Gode Wind I, Gode Wind II and Borkum Riffgrund windfarms.

As is evident from the above, a growing number of owners of offshore support vessels are finding work in the offshore wind energy industry using vessels fitted as accommodation units and a means of transferring personnel.

January 2017 saw Simon Møkster Shipping in Norway secure another contract in the offshore wind energy industry.

The Norwegian shipowner signed a contract for the vessel Stril Server with VBMS, the subsidiary of Royal Boskalis Westminster. The contract will

start in April 2017 and is for five months plus options. The vessel will assist VBMS with operations in the North Sea. Chevalier Floatels says its vessels DP Galyna and DP Gezina benefit from being highly manoeuvrable and having low fuel consumption and costs compared with many units. “Some clients still believe that bigger is better, and of course, large oil and gas vessels with more horsepower do better in bad weather, but our vessels are more workable, even in bad weather. We have completed as many as 55 individual Ampelmann connections in 24 hours,” the company told OWJ. “This is way, way more than the large vessels can do. It is true that, in rough weather, our vessels have to stop working a bit sooner. However, our vessels work in 2m significant wave height (Hs), sometimes 2.2m Hs. Larger ones can work in about 2.5m Hs, but there is a point at which no one will be using a gangway, whatever the size of the vessel. In practice, we miss a few hours until larger vessels have to stop working, but on workable days, we get far more work done than the big boys and at up to 25 per cent lower cost. On top of that, our CO2 emissions are also much lower.” OWJ

Offshore Wind Journal | 1st Quarter 2017

36 | TURBINE SUPPORT VESSELS

Low rates reduce costs but market must remain sustainable 2016 was a year of sustained low rates for support vessels in the offshore oil and gas sector.

It was also a year that saw rates for vessels for offshore wind decline as a result

by Philip Woodcock*

S

uch has been the extreme nature of the downturn in the market for offshore support vessels in the oil and gas sector that ‘consumers,’ whether they are crew transfer vessels (CTVs) or service operation vessels (SOVs) or large subsea construction vessels are in a position of being able to dictate terms. As asset values fall there are also opportunities for investors to build fleets at heavily discounted rates, if they have the cash and the courage to go against market sentiment.

With the signing of the new windfarm concessions in The Netherlands and Denmark, there will be increased downward pressure on the supply chain as developers try and make money on these optimistically low strike prices.

Although direct parallels cannot be drawn between every part of the offshore oil and gas industry and the

challenges faced by the offshore wind support vessel market, similarities exist. A reduced number of projects in 2016, which were delivered more efficiently than ever before, absorbed fewer CTVs, which mirrors the reduction in work in the oil and gas industry brought about by the drastic reduction in spending on exploration and production.

Taking costs out of the supply chain is allowing previously non-viable oil and gas projects to become competitive. The dramatic reduction in the wages for dynamic positioning operators coupled with walk-to-work technology moving from being a niche sector to a commodity has moved the SOV concept from a luxury to simply being another tool in the offshore toolbox. Vessel oversupply brought about by easy access to credit is the most obvious common denominator between

the industries, banks and the shipyards having lowered the barrier to entry for vessel ownership to a level that has proved to be unsustainable.

In 2016, charter rates for CTVs experienced downward pressure similar to that witnessed in the platform supply vessel market in oil and gas. Those who could get work took what was available at whatever terms the client offered. Operators who averaged utilisation of in excess of 60 per cent in 2016 will count themselves fortunate, especially if some of that work was committed at 2015 rates. One operator recently commented that they experienced a 32 per cent rate reduction year-on-year for the same vessel doing the same job on the same windfarm as 2015. As fixed costs could not be limited in the same fashion the vessel worked for little more than OPEX, with no accrual for depreciation or future maintenance. Anecdotal evidence suggests that vessels are being fixed for 2017 on 24-hour projects at returns of less than £500 per million invested, which is half of what is considered a sustainable business case, especially if this is for short-term work and not 365 days commitment.

For the charterer this situation allows the short

Chartering vessels at historically low rates has helped reduce costs in the offshore wind industry, but the market needs to remain sustainable

term advantages of flexibility in vessel selection, minimum commitment lengths and low charter rates. This windfall, coupled with continued low fuel costs has greatly reduced expenditure on the marine vessel spreads. For vessel operators to try and remain in business they will have to find ways of reducing their fixed costs which will include reducing crew wages, hiring foreign, low wage crews, reducing or postponing vessel maintenance and eliminating investment in training and safety management systems.

While these efforts may slow the burn of cash, they will have a long-term negative impact on safety and efficiency offshore.

Windfarm operators need a sustainable supply chain to get the operational quality and reliability they need and to have contractors who will not fail financially mid-contract. To achieve a safe and sustainable supply chain, developers and contractors must resist the urge to squeeze CTV operators for every last penny and allow enough life to flow, either by offering sustainable day rates for short term work or returning to the era of long term contracts, which provide operators with certainty on capital costs. In today’s market, the latter option will give charterers a double windfall of long-term costs fixed at today’s low rates and a supplier who will be in business for the long run, providing service at a quality level needed for safe and efficient offshore operations. OWJ *Philip Woodcock is general manager at Workships Contractors BV

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TURBINE SUPPORT VESSELS | 37

Navigational complacency – does routine outweigh basic seamanship?

Technology on crew transfer vessels (CTVS) is evolving rapidly, but despite this fast pace of change, working on a transfer vessel can be a very routine job, with the risk that complacency can set in

by Philip Woodcock*

C

TVs have evolved in a very short period of time to having high technology bridges equipped with all the latest aids to navigation found in the maritime industry. Over the same period, standards of performance and competence have greatly increased. In the UK, STCW-certified masters are now the norm, not the exception. Most companies now operate to some form of approved management system, whether the ISM Code, ISO 14001 or OHSAS 18001, and many of these systems include competence management systems in accordance with guidance provided in IMCA C 017. These are all monitored to a high standard by client vetting and performance criteria including multiple audit schemes, which have grown exponentially in recent years. However, despite these improvements in technology and procedures, navigational incidents still occur.

In November 2012, two incidents occurred that many felt could have been the ‘Piper Alpha moment’ for the offshore wind industry. There was much discussion and industry debate over the findings in the subsequent investigation report issued by the UK Marine Accident Investigation Branch. Conversations with industry professionals recently have made it clear to me that, despite all of the improvements in procedure and technology, some of the changes recommended in that report haven’t happened.

One operator recently discussed an incident that occurred in an outbound port traffic lane where the master sailed in the wrong lane and did not hear radio calls from the vessel traffic system (VTS) operator. The master had transited that route countless times to and from a windfarm and knew the waters well. On this occasion, he needed to rendezvous with a support vessel in an offshore anchorage and so took the shortest route to that location without considering the fact that he was now in the wrong traffic lane. For ease of operation, he had the wheelhouse radios on dual watch and, on departure, had not checked the channels or confirmed that the volume was loud enough. He was small, fast and highly manoeuvrable and in good visibility, so what was the problem, he thought? The end result was a formal report and investigation being initiated by the VTS. Another operator mentioned a grounding incident that occurred on a new project, which resulted in hull damage. The project had recently commenced with the first crew on site preparing passage plans. On shift change, new crew joined and had the entire project and passage documentation handed over to them. The new crew were very experienced in windfarm operations and sailed for several days before one hit a rock, causing considerable damage but fortunately no injuries or pollution. My contact reported that the

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Masters of crew transfer vessels need to bear in mind that there are risks at every stage of a voyage, not just when transferring personnel

investigation found that the crews were not following the passage plan and were in fact following the previous tracks on the plotter.

As the plotter was set at the 6 mile scale, the isolated rocks did not show on the vector charts and thus the crews were not aware that they were sailing into danger.

All of the masters involved in these incidents had achieved their UK STCW II-2 Master Code Vessel CoCs in the previous 12 months, after operating for many years as yacht masters. They were experienced and appropriately certified and up to date with the requirements of passage planning and execution. They worked for companies that set a high standard of performance and have competence programmes in place, so why did these obvious navigational errors occur?

The conclusion reached by the companies involved was that the masters were, quite simply, complacent. All had rated highly on their performance in windfarms and were highly considered by clients for getting crews on and off the turbines. It seems that the care and effort they applied during the high pressure element of the transfer of personnel was not carried over to routine navigational passage making. The perceived risk was lower as nobody was stepping over the bow, when in fact the actual risk was elevated as the vessel was underway at high speeds. Basic, common-sense seamanship skills such as planning and preparing a passage and then executing that passage as per the plan were neglected with serious consequences.

CTV operators need to take heed and work with crew so that they do not become complacent when underway. The lessons learned in MAIB Report #23/2013 need to be reviewed and reiterated to all masters, so that they are aware that there are risks not only infield, when doing transfers, but also when on passage to and from port or, as the evidence seems to show, there is a higher risk during the passage, as that is when complacency slips in. OWJ *Philip Woodcock is general manager at Workships Contractors BV

Offshore Wind Journal | 1st Quarter 2017

38 | BEST OF THE WEB

BEST OF THE WEB

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Record year for offshore wind, but clean energy investment declined in 2016 Investment in clean energy worldwide fell 18 per cent in 2016 to US$287.5 billion, despite a record year for offshore wind finance, according to the latest figures from research company Bloomberg New Energy Finance (BNEF).

Offshore wind was the brightest spot in the global clean energy investment picture in 2016. Capital spending commitments to it hit US$29.9 billion in 2016, up 40 per cent on the previous year, as developers took advantage of improved economics resulting from bigger turbines and better construction knowhow.

Last year’s record offshore wind tally included the go-ahead for the largest-ever project – Dong Energy’s 1.2 gigawatt (GW ) Hornsea windfarm off the UK coast, at a cost of US$5.7 billion – plus 14 other windfarms of more than 100 megawatts (MW ), worth anywhere between US$391 million and US$3.9 billion, in British, German, Belgian, Danish and Chinese waters.

BNEF chief executive Jon Moore commented, “The offshore wind record last year shows that this technology has made huge strides in terms of cost-effectiveness and in proving its reliability and performance. Europe saw US$25.8 billion of offshore wind investment, but there was also US$4.1 billion in China, and new markets are set to open up in North America and Taiwan.” http://bit.ly/1QZurjC

Vattenfall to acquire Atlantis I development company Vattenfall has signed an agreement to acquire the project company PNE Wind Atlantis I from PNE Wind. PNE Wind Atlantis I is the owner of the Atlantis I offshore wind project in the German sector of the North Sea, 84km northwest of the island of Borkum. The project site allows for

Offshore Wind Journal | 1st Quarter 2017

2016 was a record year for investment in offshore wind energy, but investment in other types of clean energy declined

up to 73 multimegawatt wind turbines to be installed. PNE Wind will remain involved in the development of Atlantis I as a long-term service provider.

“Acquisition of Atlantis I is a very good start for us in 2017,” said Vattenfall senior vice president and head of wind Gunnar Groebler.

“After our successful participation in the tender rounds in Denmark, we are now well on track in the German market as well. In this context, we explicitly welcome the change towards the auction system under the new EEG regime in Germany. We can now apply our knowhow in terms of cost reduction for offshore wind in this country as well.” http://bit.ly/2j2MtcI

New energy record in UK as wind outperforms coal in 2016 Statistics released by analysts at Carbon Brief show that more electricity was generated by wind than coal in the UK in 2016.

This is the first time that wind has outperformed coal for an entire year, generating 11.5 per cent of the UK’s power,

compared to just 9.2 per cent from coal.

Overall, a quarter of the UK’s electricity came from renewable sources in 2016. http://bit.ly/2jg1FAC

Business and energy secretary sees first blade from new Siemens factory The secretary of state for business, energy and industrial strategy has visited Siemens’ new wind power factory in Hull in the northeast of the UK to see the first turbine blade to be manufactured. The Right Honourable Greg Clark MP visited the factory – the centrepiece of a £310 million (US$387 million) investment – as the first 75m blade was unveiled.

The blade is the first of hundreds to be manufactured in Hull every year for Siemens’ 7 megawatt (MW) and nextgeneration 8MW turbines and will be among the first supplied to Dong Energy for the Race Bank windfarm off the Norfolk and Lincolnshire coast.

The milestone comes less than two

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BEST OF THE WEB | 39

years after a groundbreaking ceremony to mark the start of construction on a huge site the size of 78 football pitches at Hull’s Alexandra Dock. Since then, Siemens and partner Associated British Ports have transformed the underutilised waterfront location into a world-scale hub for wind power manufacturing, logistics and assembly. The development is one of Siemens’ largest-ever investments worldwide in manufacturing facilities.

The factory has been delivered ahead of programme and within budget, with the new Hull workforce demonstrating rapidly their capability in world-class manufacturing and engineering. http://bit.ly/2gLW4RH

Atlantis plans move into floating offshore wind Atlantis Resources, a well known player in the tidal power sector, is establishing a new division that will look at opportunities in floating offshore wind. The division is being established as part of a diversification strategy that will leverage the existing skill set the company has accumulated during the progression of MeyGen, the world’s largest tidal power project.

Atlantis Energy, as the new division will be known, will initially focus on opportunities to develop floating offshore wind, subsea interconnectors, tidal barrage projects, tidal lagoon projects and pumped storage projects on behalf of infrastructure funds, investment banks and private developers who are looking

to invest in renewable and grid-related projects in the UK. It is expected that Atlantis Energy will be operational by the end of the first quarter of 2017. http://bit.ly/2jaK1AH

SB Submarine Systems awarded first offshore wind contract SB Submarine Systems (SBSS) has been awarded its first contract in the offshore wind industry, installing the export cables for the Binhai offshore windfarm in China. The award includes cable-laying and trenching works for the 300 megawatt windfarm in Jiangsu province, China. The project is owned and operated by China Datang Corporation. Three 23km, 220kV cables will be installed from the offshore substation to the grid ashore, with SBSS deploying a chartered-in dynamically positioned barge and jetting sledge to complete its section of the work scope. http://bit.ly/2j1rTso

SMST to build unique offshore access system for Acta Marine newbuild SMST Designers and Constructors in The Netherlands has been awarded a contract for the delivery of a motioncompensated gangway and 3D motioncompensated crane for Acta Marine’s

new offshore construction vessel, which is being built at Ulstein in Norway. SMST claims that the system will be the first of its kind “and offers a complete solution for offshore logistics.”

The system is mounted on an integrated tower including height adjustment and a lift for personnel and cargo. It is a complete package with an elevator and access bridge trolley system.

The trolley allows pallets carrying cargo to be transported onto the elevator, which can stop at different levels to optimise the performance of the vessel. http://bit.ly/2leSiSi

CS Wind to build tower manufacturing facility in the UK CS Wind is to build a new offshore tower manufacturing facility in Campbeltown, Scotland, as a result of a multimillion pound investment from Dong Energy.

The investment will give Dong Energy preferred access rights to towers for its offshore windfarms.

The new facility will be the first in the UK that can manufacture towers for offshore wind turbines and will be located adjacent to CS Wind’s current onshore facilities. It will be able to produce at least 50 towers a year, and 70 jobs will be safeguarded as a result.

The investment will enable the contract for the first 95 towers built by CS Wind, which Siemens Wind Power has agreed to take, and will help in the establishment of a tower manufacturing facility in the UK. http://bit.ly/1QZurjC

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Editor’s selection: Editor’s selection:

To upload a whitepaper to the Knowledge Bank, please email Steve Edwards at steve.edwards@rivieramm.com

Editor’s comment:

Jack-up vessels are widely used in the Predicting performance, Addressing jack-up safety through promoting offshore oil and gas and renewable transparency,

by International Paintenergy industries. Offshore wind, wave targeted research and development and tidal projects are introducing new Intertrac Vision: a new tool to predict the impact of fouling control coatings on and unique risks by moving further The key to safety in jack-up operations offshore into deeper waters and more ship efficiency. This is constant risk management.

Thispaper whiteexplains why hostile environments. The selection and thesome shipping industry needs an improved paper presents of the challenges vessel performance prediction facing the global jack-up fleet along with the tool. management of appropriate vessels is critical to ensure the safe and successful research and development efforts ABS has execution of a project. undertaken to address those challenges.

Acta Marine orders vessel Acta Marine in The Netherlands has signed a contract with Ulstein Verft in Norway for a dynamic positioning class 2 construction support vessel. The vessel is primarily aimed at the offshore wind market and is a new design from Ulstein Design & Solutions, the SX195. “With the X-Stern hullform, integrated walk-to-work gangway system, 3D motion compensated crane and high quality accommodation it represents our next step in responding to the market,” said Acta Marine’s managing director Rob Boer. http://bit.ly/2jeNHNO

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Offshore Wind Journal | 1st Quarter 2017

40 | PROFILE

More cost reduction to come, but pinch points developing

B

ruce Valpy founded BVG Associates more than a decade ago. He has almost 30 years’ experience in renewables. Looking back on 2016, and forward to 2017, Mr Valpy said of the offshore wind industry recently that ‘the next stage of market growth starts here.’

“We’ve seen the fall and fall of offshore wind prices, with auctions for Borssele, Vesterhav and Kriegers Flak, but still see ample room, in the long-term, for further cost reduction based on technology,” he told OWJ. “However, we don’t see so much more room to squeeze margins or take benefit of supply chain dynamics in a market that is consolidating, as the optimistic vision of scale in the next decade is tamed somewhat.”

A number of reasons have been evinced for the steep fall in prices that we saw in 2016. Mr Valpy believes that the auction systems adopted in Denmark and The Netherlands, new technology, the low cost of capital and an assumption of future volume have all played a part, and it may also be that bid price reductions are being driven in part by anticipated reductions in operational expenditure over the lifetime of an offshore windfarm that are not yet 'in the bag.'

“There have been big advances in areas such as offshore access systems and service operation

One of Europe’s leading consultants in the wind sector says he believes the cost of offshore wind will keep falling, but says consolidation is not without its issues

Bruce Valpy: “costs will continue to come down but consolidation is creating challenges too”

Offshore Wind Journal | 1st Quarter 2017

vessels in the last couple of years,” said Mr Valpy, “and there are more to come in these areas, as well as in monitoring and control.

With things like windfarmwide control systems on the horizon developers must be anticipating quite a significant decline in OPEX.” There are also further cost reductions to come in installation, he believes, not least from new types of foundations, with installation concepts that would see reduced need for high cost installation vessels.

Recent developments in the market for large, high megawatt (MW) offshore turbines have left three main players – Siemens, GE and MHI Vestas Offshore Wind – with a question mark over the future in the sector of Senvion, whose 6MW units are small in comparison. Mr Valpy said other examples of consolidation include effectively saying goodbye to Areva and Gamesa from the offshore turbine competitive landscape, but in his view, this potentially leaves current offshore wind markets in an awkward position for two reasons. “Firstly,” he said, “the small number of players is barely enough to drive competition. Second, the offshore turnover of each player in the market may not be enough to facilitate next-generation turbine development, which is one of the keys to ongoing cost reduction. Competitive auctions can partly mitigate

the first of these, but there is no substitute for the next generation of larger turbines, and that needs more market.”

As he also notes, it is not out of the question that – with three main players left in the market picking up the bulk of orders – capacity at one or more of those players could severely constrained in the 2018/2020 period.

“The Chinese remain reticent about pushing forward outside their immediate market,” he told OWJ. “It will take time for them to establish in the European market, and if they are serious about projects in the next five years they should be building relationships and looking for demonstration sites, but that doesn’t seem to be happening."

As he points out, another issue for Chinese manufacturers is that, unlike their European counterparts, they don’t have an established supply chain in Europe or an established O&M network to support turbines.

In 2017 he predicts that, based on recent auction prices and the prospect of further cost reductions, there will be a rapid expansion in the number of countries interested in establishing an offshore wind industry. “This will happen as they see that offshore wind is not just a curiosity in northern Europe, but in many cases the most scalable, low-carbon generation source that can be built close to population centres,” he concluded. OWJ

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