Subtittle if needed. If not MONTH 2018 Published in Month 2018 Boosting offshore wind energy in the Baltic Sea November 2019 WindEurope’s Baltic Taskforce is a network of Industry representatives and National Associations promoting offshore wind energy in the Baltic States. The Taskforce regularly engages with governmental institutions – at both national and international level – and organises targeted workshops in the Baltic countries. DISCLAIMER This publication contains information collected and then verified with relevant members of the industry ahead of publication. Neither WindEurope, nor its members, nor their related entities are, by means of this publication, rendering professional advice or services. Neither WindEurope nor its members shall be responsible for any loss whatsoever sustained by any person who relies on this publication. TEXT AND ANALYSIS: WindEurope Taskforce Baltic Mattia Cecchinato, WindEurope EDITORS: Iván Pineda, WindEurope Daniel Fraile, WindEurope DESIGN: Laia Miró, WindEurope COVER PHOTO: Baltic 1 Wind farm. Copyright: EnBW MORE INFORMATION: [email protected] +32 2 213 18 68 CONTEXT Offshore wind energy greatly contributes to containing projections of up to 450 GW of offshore wind capacity -in global warming and it is fundamental to reaching Europe’s stalled (EC - A Clean Planet for all, 2018). Installations in 2030 and 2050 Climate and Energy targets in a cost-ef- the Baltic Sea could reach 85 GW by 2050, according to fective way. WindEurope’s latest scenarios. This would make the Baltic Sea the second-largest basin for offshore wind in Europe, Today there are over 20 GW of offshore wind installed after the North Sea. in European waters, of which around 2 GW are in the Baltic Sea (Denmark 872 MW, Finland 68 MW, Germany The cumulative potential capacity identified in the Baltic 1,074 MW and Sweden 192 MW). By 2030, WindEurope Sea by the European Commission (BEMIP Final Report, expects that 9 GW could be easily deployed in the Baltic 2019) exceeds 93 GW, with a generation of 325 TWh/year Sea. With the right ambitions from Governments and (around 30% of the total energy consumption of the Baltic intensified regional cooperation, this could increase to countries in 2016). more than 14 GW. Members States shall define clear climate and energy In its recent 2050 Long Term Decarbonisation Strategy, targets to build the basis for the expansion of the internal the European Commission has identified wind energy as offshore markets and exploit the added value that the the dominant power generation technology by 2050, with sector brings. FIGURE 1 Map of online and planned projects (October 2019). Source: WindEurope interactive offshore map (www.windeurope.org) Boosting offshore wind energy in the Baltic Sea 3 WindEurope HOW CAN THE BALTIC SEA BECOME A RENEWABLE ENERGY HUB The wind energy industry is contributing to a fundamental transformation of the European energy sector. It provides clean, competitive and reliable energy while creating local and international value in terms of jobs and economic growth. This is now a critical moment: Member States have the possibility to take a big step forward in decarbon- ising the energy sector and increase security of supply. But to exploit these benefits, actions must be taken fast. This document provides an overview of benefits and ac- tions needed to exploit the full potential of offshore wind in the Baltic Sea. 1. Jobs and economic growth: 2. National Energy and Climate Plans: Offshore wind energy stimulates the economy by boosting EU Member States will plan their energy transition to- import and export, attracting significant international- in wards 2030 through the adoption of National Energy and vestments which support economic growth. Climate Plans (NECPs). These plans are a fundamental Offshore wind energy provides jobs. The industry already instrument to provide stable conditions and visibility for employs over 60,000 people all around Europe and this investments by defining clear volumes and timelines for number is expected to increase significantly with more offshore wind. installations. Individual countries are responsible for their own Other businesses, active in the supply chain, also benefit planning, consenting and overall development from the sector maturity and the experience acquired of their internal markets. over two decades of growth. Governments should provide visibility on future offshore The supply chain requires stable rates of manufacture and volumes with appropriate support mechanisms and installation for a minimum of 10 years in order to make ensure an increase in site allocation development and final investment decisions. In this way the supply chains consenting from 2020. It typically takes about eleven for components, vessels, ports services and Operation and years to get from the start of wind farm development to Maintenance Services (OMS) can amortise investment the completion of installation and start of electricity gen- over a reasonable period. eration (See Figure 2). 4 Boosting offshore wind energy in the Baltic Sea WindEurope 3. Regional cooperation: 4. EU Funding: Regional cooperation will be key in supporting national To support this growth the European institutions are growth in offshore wind through coordinated policy- making funding available. Different funding schemes making, especially in relation to grid development. A allow both governments and the private sector to boost long-term regulatory framework and the streamlining technological innovation, strengthen cooperation and of administrative requirements will give certainty to the share knowledge. Different funding schemes are available. market, enabling cost reduction and ensuring the stable Between 2014 and 2020, the EU has provided almost deployment of projects. Regional cooperation makes even €80bn in funding for research, mainly through its flagship more economic sense in the Southern part of the basin, research programme Horizon 2020. Another large part of where sites are more attractive due to higher market EU budget is managed in partnership with national and values for offshore wind power generation. regional authorities through shared management, largely through the Structural & Investment Funds. Grid development should anticipate major growth in both offshore and onshore wind energy. International coordi- Together with the European Commission, Member States nation and cooperation is a major challenge. Governments should exploit the potential of EU funding mechanisms for should foster hybrid offshore projects to optimise the receiving support in deploying cross-border projects. space at sea and promote the progressive development of meshed offshore grids. FIGURE 2 Offshore wind farms development stages e s LEASING CONSENTING FINANCIAL CLOSE INSTALLATION Pha Determine wind Early site survey Detailed design, supplier Manufacture Onshore and offshore y it work. Grid & building and pre-assembly v Environmental and permits, early site layout, of components technology review and farm commissioning Acti feasibility studies g 2 years 4 years 2 years 3 years min i T Support FID* allocation *Final investment decision Boosting offshore wind energy in the Baltic Sea 5 WindEurope Chapter name Copyright: EnBW 6 Boosting offshore wind energy in the Baltic Sea WindEurope 1. HOW DOES THE LOW CARBON Offshore wind to boost Polish economy TRANSITION TRANSLATE Wind energy already constitutes an important el- INTO ECONOMIC ement of the Polish energy mix. At the end of 2018, onshore installed capacity in Poland amounted to GROWTH, JOBS AND almost 5.9 GW, which corresponds to more than INDUSTRIALISATION? 14% of cumulated generation capacity in the National Power System. And the government has Offshore wind energy enhances energy independence shown positive signs to support further growth. and security as it prevents exposure to the volatility of oil, gas and coal prices and dependence on supply from other The first Polish offshore wind farms will start pro- countries. Offshore wind will also be key in the desynchro- ducing electricity around 2025; more than 10 nisation from the Russian power grid. GW of capacity installed in the Polish Exclusive Economic Zone is planned to be commissioned by Offshore wind energy brings concrete advantages in 2040. These ambitious plans attract substantial in- terms of local development, jobs and growth. All coun- terest among national and foreign investors. tries surrounding the sea basin would greatly benefit from developing offshore wind. In 2016, the wind energy Expert calculations demonstrate that the con- industry, and the activities related to it, added €36.1bn struction of 6 GW of offshore wind farms will to EU GDP in total. €22.3bn of this was a direct result of create 77,000 jobs in Poland, in particular on the activity within the wind energy industry: onshore and off- coast, bringing approximately PLN 60 billion (€ shore wind energy developers, turbine manufacturers, 14 billion) of added GDP value and PLN 15 billion component manufacturers, service providers and off- (€3.5 billion) of Corporate Income Tax (CIT) and shore wind energy substructures. Value-Added Tax (VAT) revenues by 2030. Wind energy creates jobs, not only in turbine manufac- A typical wind turbine tower requires 300–400 turing and electricity production, but also in many other tonnes of steel, with further 750–1,200 tonnes for industries and economic sectors. It is estimated that, in its supporting structure. 6 GW of offshore wind the scenario of 32 GW of offshore