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02 MARKET AND INDUSTRY TRENDS
farther out, into deeper waters. 151 By year’s end, the distance from
shore and water depth of grid-connected projects in Europe
averaged 43.3 kilometres and 27.1 metres, respectively (up from
32.9 kilometres and 22.4 metres, respectively, in 2014), due largely
to increased deployment in Germany. 152
new regions or new areas of business. China Three Gorges and
state-owned SDIC (China) both acquired UK offshore projects
within a few months of each other. 136 Canadian pipeline and
energy company Enbridge bought a long-delayed wind project
in the US state of West Virginia. 137 In addition, the wind industry
continued moving into solar PV (and vice versa) – for example,
Suzlon (India) began developing a solar project in India – and
several solar PV-wind hybrid projects were under development
as of early 2016. 138
Wind energy technology continued to evolve, driven by several
factors, including: mounting global competition; efforts to make
turbine manufacturing easier and cheaper; the need to optimise
power generation at lower wind speeds; and increasingly
demanding grid codes to deal with rising penetration of variable
renewable sources. 139 To meet increasing demand from grid
operators for stable feed-in, Senvion launched a new turbine for
the German market. 140 Also in 2015, GE launched new software
to track and collect data from individual turbines for optimising
performance and increasing output. 141
To reach stronger winds and boost output, there is a general
trend towards larger machines – including longer blades,
larger rotor size and higher hub heights. 142 Such changes have
driven capacity factors significantly higher within given wind
resource regimes, creating new opportunities for wind power
in established markets as well as new ones. 143 During 2015, new
low-speed turbines were launched by several manufacturers,
including Gamesa, GE, Nordex, Siemens and Vestas. 144
Capacity ratings continued to rise in 2015, with the average size
turbine delivered to market up slightly to 2 MW. 145 Average turbine
sizes were highest in Europe (2.7 MW) – particularly in Denmark
and Germany – followed by Africa (2.4 MW), the Americas (nearly
2.1 MW) and Asia-Pacific (1.8 MW). 146 Turbines for use offshore
also are growing, as are project sizes, driven by the need to
reduce costs through scale and standardisation. 147 In Europe, the
average capacity of new turbines installed offshore was 4.2 MW,
up 13% relative to 2014, due to significant deployment of turbines
in the 4–6 MW range. 148 By late 2015, there were several orders
already on the books for 7 MW and 8 MW machines, and research
projects were looking at 10–20 MW turbines for offshore. 149
The offshore wind industry differs technologically and logistically
from onshore wind. 150 In addition to the deployment of ever-larger
turbines and projects, the offshore industry continues to move
The majority of substructures off Europe in 2015 continued to be
monopiles (97%), followed by jackets (3%). 153 However, to access
winds in even deeper waters – in the Atlantic and Mediterranean,
and just off Japan’s shore – the industry continues to invest in the
development of floating turbines (anchored by mooring systems),
which reduce foundation costs and other offshore logistical
challenges. 154 In early 2015, a few test turbines were floating
offshore worldwide; before the year was out, the world’s largest
(7 MW) floating turbine was operating off Japan’s coast, France
had launched the world’s first tender for floating turbines, and oil
and gas giant Statoil (Norway) had contracted Siemens to build a
30 MW floating wind farm off Scotland. 155
The most significant challenge facing the offshore industry is
the lack of policy stability in key markets, which is important for
achieving the scale and low-cost financing that are necessary
to reduce costs to competitive levels. 156 In the EU, the lack of
co-ordination of regulations across Member States is hampering
offshore development. 157
The price differential between fossil fuel and offshore wind
generation remains significant, and the industry is working to
close this gap. 158 In early 2015, manufacturers MHI-Vestas and
Siemens, and developer DONG Energy signed a joint declaration
for a united industry goal to drive the cost of offshore wind
energy below USD 112/MWh (EUR 100/MWh) by 2020. 159 During
the year, Siemens unveiled a new direct current (DC) solution
for connecting offshore wind turbines to the grid at lower cost;
the solution also increases transmission capacity and reduces
transmission losses. 160 In addition, the company adapted an
existing cargo shipping method for the transport of offshore
turbine components that reduces costs by eliminating the
need for a crane; the first such ship might be launched by late
2016. 161 Another significant development was the diversification
of financial structures used during construction and operation:
project bonds emerged in 2015 as a competitive financing tool in
response to reduced risk perception for offshore projects. 162
In the small-scale wind industry, five countries (Canada, China,
Germany, the United Kingdom and the United States) accounted
for more than 50% of turbine manufacturers as of 2014; aside
from China, developing countries still play a minor role. 163 UK
and US manufacturers continued to rely on export markets as
a source of revenue, but exports (in terms of units sold) were
down significantly for both countries in 2014 relative to 2013. 164 To
increase the competitiveness of small-scale wind, several leading
US small-scale and distributed wind companies have begun
offering long-term leases to build on the success of third-party
financing for solar PV. 165 In early 2016, Statoil and United Wind
(United States) announced a joint venture, securing Statoil’s
entry into the US small-scale and distributed wind market. 166
See Table 2 on pages 82–85 for a summary of the main renewable
energy technologies and their costs and capacity factors; see
also Sidebar 3 for a discussion of technology cost trends. 167
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