Floating Offshore Wind (FLOW) is a nascent technology which offers diversification opportunities for the oil and gas industry and the supply chain.
The UK oil and gas industry has experience of adapting to similar technological change - including the development of Floating Production Storage and Offloading vessels (FPSOs) - as a cheaper, more flexible alternative to traditional fixed production platforms.
The potential to redeploy existing oil and gas industry expertise around floating technology into technologies such as FLOW offers a way in to the market at an exciting point in its development, while renewables operators have an increasing depth of experience.
According to the UK government’s energy white paper published in December, the UK currently supports around 10GW of offshore wind generation - the largest installed capacity in the world. The white paper set a new, increased target of 40GW of installed capacity by 2030, of which 1GW is planned to be FLOW.
FLOW can be installed further out to sea and in deeper waters than traditional fixed offshore wind arrays, meaning it can take advantage of stronger winds. Although currently considerably more expensive to install and maintain than its fixed counterpart, experience with onshore wind and solar shows how quickly costs can drop as the technology matures, and given the right support.
It is significant that the UK government will for the first time allow FLOW to compete for support by way of Contracts for Difference (CfD) when CfD allocation round 4 is expected to open for bids. The government plans to establish a separate funding pot for fixed offshore wind and has introduced a separate definition for FLOW, which will compete against other less established technologies such as geothermal, tidal stream and wave power in pot 2.
Inspiratia tracked 11 FLOW deals last year with a total disclosed transaction volume of $1.1 billion – a record number, according to the publication. Of these transactions, the majority were located off the coasts of France, Norway and the UK.
Part of the popularity of FPSOs stemmed from the cost savings against permanent structures like fixed production platforms. FLOW developers can similarly benefit from lighter, more cost effective equipment which can be assembled in port and towed to site rather than relying on large, expensive installation vessels to transport and erect heavy fixed bottom turbines.
The ability to assemble FLOW equipment onshore means minimising highly weather-dependent operations like offshore heavy lifts and assembly, saving time and costs, and reducing safety risks for offshore workers. Maintenance can often also take place in safer onshore conditions.
We are already seeing traditional energy companies announce their commitment to clean energy as part of their diversification plans, a shift that will continue to gain further momentum as part of the UK's transition to a net zero economy by 2050.
The UK's expertise in offshore oil and gas is recognised as world-leading. The challenge now is to redirect some of that expertise into an emerging floating offshore wind market with the associated benefits for the environment, the economy and jobs.
Gavin Farquhar, Partner and specialist in marine law at Pinsent Masons
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March 19, 2021 at 02:01PM
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Oil and gas technology goes with the FLOW - Gavin Farquhar - The Scotsman
"flow" - Google News
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