Dutch - American - German Offshore Wind Summit 2014 May 19 th, 2014

Transcription

1 Dutch - American - German Offshore Wind Summit 2014 May 19 th, 2014 Market Update Germany and Cost Reduction Potentials of Offshore Wind Power in Germany Peter Heinrich, Fichtner Water & Wind

2 The Fichtner Group Established in 1922 and family-owned ever since Germany s biggest independent engineering and consultancy enterprise for infrastructure projects Approximately 1800 employees worldwide 500 in our Home Office Project experience in more than 160 countries Over 1200 ongoing projects 500 of these in our Home Office Total turnover of 260 million in 2012 Capital investment volume now under planning in the home office: 87 billion of which some 32 billion is in renewable energies 2

3 Fichtner's Areas of Activity Energy Energy economics conventional power plants renewables district heating energy transmission and distribution I&C and power system technology smart grids electric mobility energy management oil & gas Environment Environmental management environmental information systems environmental studies permit management and strategy environmental protection technologies soil and water protection air pollution control emissions trading waste management Water & Infrastructure Total water management drinking water supply and sanitation seawater desalination integrated infrastructure concepts site development traffic, transportation and civil engineering mining and mineral economics Consulting & IT Studies organization and strategy consultancy privatizations project management financial modeling infrastructure management IT consultancy and services geo-solutions 3

4 Asia Africa Europe Germany Fichtner Group Companies Fichtner GmbH & Co. KG (home office), Stuttgart Fichtner Bauconsulting GmbH, Stuttgart Fichtner Carbon Management GmbH, Stuttgart Fichtner IT Consulting AG, Stuttgart Fichtner Management Consulting AG, Stuttgart Fichtner MEI Oil & Gas GmbH, Stuttgart Fichtner Mining & Environment GmbH, Essen Fichtner Solar GmbH, Stuttgart Fichtner Water & Transportation GmbH, Stuttgart Fichtner Water & Wind GmbH, Hamburg GefaÖ mbh, Walldorf IKG Fichtner GmbH, Ludwigshafen P&S Consulting GmbH, Duisburg SPE Unternehmensberatung GmbH, Mannheim Fichtner Consulting Engineers Ltd., Manchester Fichtner Energy s.r.o., Levice Fichtner Engineering S.A., Buchrest Fichtner Environment SRL, Bucharest Fichtner Italia s.r.l., Genoa Fichtner Management Consulting AG Schweiz, Zurich Fichtner Swiss GmbH, Zurich ACE Associated Consultants and Engineers Ltd., Sofia RESA - Recuperación de Energía S.A., Barcelona Fichtner Société Africaine d Ingénierie sprl, Kinshasa Fichtner Congo Sarl, Brazzaville Fichtner Asia Pte Ltd., Singapore Fichtner Consulting Engineers (India) Pvt. Ltd., Chennai Fichtner Engineering (Malaysia) Sdn. Bhd., Kuala Lumpur Fichtner Pacific Engineers Inc., Taipei Fichtner Vietnam Company Limited, Hanoi Together with our Stuttgart home office, 29 subsidiaries and affiliates as well as 68 branch and project offices, we are represented in more than 50 countries worldwide. 4

5 Range of Engineering and Consulting Services Analysis and Conceptual Design Feasibility studies environmental impact and siting studies economic and technical analyses masterplans integrated infrastructure concepts plant concepts preliminary planning and conceptual engineering operation management concepts IT concepts Engineering and Contract Award General planning basic engineering permit engineering detail engineering plant and functional specifications tendering bid evaluation contract award recommendation contractual negotiations contract formulation Implementation Check of drawings shop acceptances specialist site management and supervision coordination of commissioning final acceptance documentation trial operation and warranty support interface coordination project steering general project supervision health and safety coordination staff training Operation Process optimization environmental, risk and quality management maintenance scheduling optimization of deployment operation, management and environmental information systems Business Consultancy Market analyses tariff studies project development strategy and organization financial modeling project financing project management lender s engineering due diligence mergers & acquisitions IT consultancy sectorial IT solutions 5

6 Fichtner Water & Wind GmbH, Hamburg Areas of Business: Civil Hydraulics Maritime Traffic Engineering, Harbor Design, Coastal Protection and Flood Control, Dredging and Soil Management Structural Engineering Hydraulic Structures, Construction in Existing Building Stock, Civil Engineering, Detailed Design Geotechnics Soil Mechanics and Geotechnical Engineering Engineering and Hydrogeology, Soil Mechanics Laboratory, Dredging and Earthworks Offshore Wind Wind Farm Planning and Energy Yield Assessments, Design / Design Review, Lender s Engineering, Electrical Engineering, Installation and Logistics, Site Management Onshore Wind Design / Design Review, Lender s Engineering, Electrical Engineering, Installation and Logistics, Site Management WATER WIND 6

7 Market update Germany The installed capacity for power generation from renewable energies increased in 1990 to 2013 from 4,000 MW to 82,400 MW Entwicklung Installed der installierten capacity of Leistung renewable der Erneuerbaren energies in Germany Energien in from Deutschland 1990 to bis 2013 [MW bzw. / MWp] MWp] Geothermie Photovoltaik Bioenergie Windenergie Wasserkraft Source: wind:research, Briese

8 Market update Germany The main drivers have been wind power and biomas Electricity Entwicklung production der Stromerzeugung from renewable aus Erneuerbaren energies sort Energien by energy nach einzelnen source from Energieträgern 1990 to [GWh] bis 2013 [GWh] Geothermie Photovoltaik Bioenergie Windenergie Wasserkraft Source: wind:research, Briese

9 Market update Germany In the North sea, 568 MW in operation, 2,029 MW under construction In the Baltic sea, 48 MW in operation, 288 MW under construction Installierte Installed capacity Leistung (North Nordsee: Sea): 568 MW* 385 MW February 2014 operating Global Tech 1 (400 MW) BARD Offshore 1 (400 MW) Trianel Windpark Borkum (200MW, Ausbaustufe I) Alpha Ventus (60 MW) Borkum Riffgrund 1 (277 MW) Source: wind:research, Briese 2014 DanTysk (288 MW) Amrumbank West (288 MW) Nordsee Ost (295 MW) Meerwind Süd/Ost (288 MW) Borkum Riffgat (108 MW) no grid connection under construction approved commissioning in 1-2 years commissioning in 3-4 years commissioning in 5-6 years commissioning in 7-8+ years planned commissioning in <6-7 years commissioning in 8-9 years commissiong in years commissioning in 12+ years early concept * Without Hooksiel and Dollart Emden 9

10 Market update Germany DC Grid connection North Sea: 568 MW in operation, 8 GW by ,641 MW under construction/ordered 1,800 MW under procurement Source: TenneT,

11 Market update Germany The German regulatory framework is driven by the EEG Renewable Energy Act Erneuerbare Energien Gesetz EEG 2.0 (2014): Enforcement expected by Expansion target: 6,5 GW (allocation of grid connection capacity) plus 1,2 GW buffer Remuneration ( Stauchungsmodell ) : 19 ct/kwh first 8 years until 2019 Yearly deduction 1 ct/kwh from Structural approach: From fixed tariffs to auctioning 11

12 Market update Germany 0,6 GW in operation 2,3 GW under construction 7,2 GW under project development 28 OWP have received BSH approval 95 OWP have applyied for BSH approval OWP under construction MW OWP have received approval MW Amrumbank West 288 Butendiek 288 Borkum Riffgrund I 277 Gode Wind I 330 DanTysk 288 Gode Wind II 252 Global Tech I 400 Kaikas 581 Meerwind Süd/Ost 288 Veja Mate 400 Nordsee Ost 295 Albatros 400 Borkum West II 200 Borkum Riffgrund II 349 Baltic Borkum Riffgrund West I 270 Delta Nordsee I & II 402 Deutsche Bucht 210 HeDreiht 400 Hohe See 492 Innogy Nordsee Innogy Nordsee MEG Offshore I 400 Nordsee One 332 Nördlicher Grund 350 Sandbank Arkona-Becken Südost 400 Wikinger 400 Total 2324 Total 7208 Source: Bundesamt für Seeschifffahrt und Hydrographie 12

13 MW (installed capacity) Market update Germany Wind:research: Resulting from OWPs under construction/with FID, in Germany 6,6 GW are to be expected by 2020 Ausbau Expansion der Offshore-Windenergie of offshore wind energy in Deutschland in Germany Best-case scenario Reference scenario Worst-case scenario Current target of federal government until 2020 (6.500 MW) and 2030 ( MW) Previous target of federal government until 2020 ( MW) and 2030 ( MW) Offshore Wind Farm planned operating Source: wind:research, Briese

14 Market update Germany Challange of the year : Reasons for serious delays Skilled worker shortage Lack of qualified specialists Infrastructure deficiencies Port extension needed Withdrawal from nuclear withdrawal Set-back for renewable energies Source: wind:research, Briese 2014 Shipping capacities Lack of specialised vessels for the offshore industry Pile driving noise Protecting Porpoises Financing problems uncertainties by investors Grid connection (TenneT) various resources 2012 EEGamendment Uncertainty resulting from amendments to be expected EEG apportionment Altmeier-Rösler discussion 14

15 Market update Germany Key players for investment and financing will change in the future Previous fundings in Germany: Project financing Infrastructure and pension funds Construction enterprises Major utility companies Regional utilities Future developments: EPC Contractors New Asian players Insurance companies Funds Trend: Allocation of total project risks 15

16 Market update Germany Complex requirements of various market stakeholders and a permanently moving political and regulatory framework will drive the development of Offshore Wind Energy Complex and moving political, regulatory and legal framework Public financing support (EIB, KfW) Limited readiness to assume risks in investment and financing Offshore grid connection progressing, but still bottleneck In Germany and Europe slow progress on transmission network extension Increasing experience in all project development and supply chain processes Design, application and certification process, project implementation still case-by-case uniques Substantial cost reduction potential still to be mobilized 16

17 Cost Reduction Potentials of Offshore Wind Power in Germany

18 The study has been carried out over the course of three quarters including an intense exchange with the offshore wind industry Project related supervision by representatives of the principals Phase 1: Model setup and cost base Phase 2: Verification by industry and stakeholders Phase 3: Optimisation approaches and recommendations Determination of cost base for all sites and years Model setup for Levelised Cost of Energy (LCOE) Evaluation of preliminary results Result validation by an expert panel (survey and financing workshop) Analysis of verified results Development of optimisation approaches Derivation of recommendations for politics, industry and other stakeholders 2013 Prognos AG 18

19 The study analyses two market growth scenarios and three different sites in the North Sea Scenario definition Installed capacity Scen. 1 Scen. 2 Site A Water depth 30 m Distance to port 40 km Wind speed 9,9 m/s Site B Water depth 40 m Distance to port 80 km Wind speed 10 m/s Site C Water depth 50 m Distance to port 120 km Wind speed 10,1 m/s B Germany: 0,6 GW* Europe: 6 GW Germany: 0,6 GW* Europe: 6 GW A C Scenario 2 Scenario 1 B B GER: 3,2 GW EU: 13 GW GER: 5-6 GW EU: 25 GW A C A C B B GER: 6 GW EU: 20 GW GER: 10 GW EU: 40 GW A C A C B B GER: 9 GW EU: > 20 GW GER: 14 GW EU: > 40 GW A C A C Initial operation: * Expected value at the end of the year Prognos AG 19

20 Planning and construction periods of up to ten years require a long-term stable legislative framework Project development 4-6 years Preparation and constrution Operating phase Possible extension of operation phase Decommissioning Building permission 1-2 years Financing negotiation FID 2-4 years Initial operation 20 years 5 years 1-2 years Total project duration 27 bis 37 years 2013 Prognos AG 20

21 Costs of the support structure and installation drive down investment costs Entwicklung Specific investment der spez. Investitionskosten costs at Site B - am Scenario Standort 1 Bgiven - Szenario in k Euro 1 in Tsd. Euro 2012 /MW 2012 /MW -6% -13% -17% 4,169 3, , , , ,201 1,350 1,300 1, MW MW Entwicklung Specific investment der spez. Investitionskosten costs at Site B -am Scenario Standort 2 Bgiven - Szenario in k Euro 2 in Tsd. Euro 2012 /MW 2012 /MW -7% 4,169 3, , MW -17% 3, MW 3, ,201 1,337 1,251 1,093-27% MW MW MW MW Turbine Support structure Cable Cabel Transformer station Installation Certification/Approval Contingency 2013 Prognos AG 21

22 Increasing experience and improved logistic concepts will bring down O&M costs by 24 % to 43 % Entwicklung Specific O&M der costs jährlichen at Site spez. B - Scenario Betriebskosten 1 given in am k Standort Euro 2012 /MW B - Szenario 1 in Tsd. Euro 2012 /MW MW -16% MW Insurance Versicherung -18% MW O&M -19% MW Entwicklung Specific O&M der costs jährlichen at Site spez. B - Scenario Betriebskosten 2 given in am k Standort Euro 2012 /MW B - Szenario 2 in Tsd. Euro 2012 /MW % -28% -33% MW MW Insurance Versicherung MW O&M MW 2013 Prognos AG 22

23 External wake losses due to the German cluster approach limit the increase in the net electricity output for German offshore wind farms Entwicklung Specific energy der production spezifischen at Stromproduktion Site B - Scenario am 1 given Standort in MWh/MW B - Szenario 1 in MWh/MW 5,072 5,109 5,305 5,588 3,970 3,965 4,037 4, MW MW MW MW Entwicklung Specific energy der production spezifischen at Stromproduktion Site B - Scenario am 2 given Standort in MWh/MW B - Szenario 2 in MWh/MW 5,072 5,139 5,271 5,468 3,970 3,988 3,997 4,074 Gross Brutto Netto MW MW MW MW 2013 Prognos AG 23

24 Investment costs Scale up to larger turbines and an increased competition leads to a higher cost reduction of offshore technologies in the scenario Levelized cost of electricity, ct/kwh 2012, Site B -32% -39% , Scenario Scenario Turbine Support structure Cabel Cable Transformer station Installation Certification/Approval Contingency Operational costs Decommissioning 2013 Prognos AG 24

25 On average the LCOE can be reduced by 31 % to 39 % until 2023 Stromgestehungskosten nach Standorten in den Szenarien 1 und 2, in Cent 2012 /kwh Stromgestehungskosten Levelized cost of energy nach - Scenario Standorten 1 and in 2, den given Szenarien in Cent 1 und 2, in Cent 2012 /kwh 2012 /MW Windpark 2013 Site A ( A Windpark (30 m WD; m WT; A40 km km DTP) 2023 HE) Windpark 2013 Site B ( B Windpark (40 m WD; m WT; B 80 km km DTP) 2023 HE) Windpark 2013 Site C (50 C 2017 Windpark (50 m WD; m WT; 2020 C120 km km DTP) 2023 HE) Windpark Szenario Scenario A 1 Windpark Szenario Scenario B 2 Status Windpark quo C Szenario 1 Szenario 2 Status quo 2013 Prognos AG 25

26 Two third of the cost reduction potential is driven by the technology Scenario 1 Scenario 2 Financing costs 9.6% 8.4% Support structure Operation & Maintenance 5.5% 5.4% 6.6% 7.8% Installation 3.6% 5.0% Contingency (REL)* 2.3% 0.7% Contingency (ABS)* 1.8% 2.6% Transformer station 1.6% 1.7% Decommissioning Certification & Approval Other 0.9% 0.8% 0.4% Investment O & M Financing & Risk 1.3% 1.6% 0.6% Turbine 0.2% Decommissioning 2.4% TOTAL 32% 39% 0% 10% 20% 30% 40% 0% 10% 20% 30% 40% *Contingency (relative/absolute) for risks during project implementation (Weather, delayed delivery, grid connection etc.) 2013 Prognos AG 26

27 A continuous development of the market is a prerequisite for further cost reductions. Recommendations for the policy environment and regulatory framework: Create stable legal and policy frameworks Define standards for plant components and grid connections Simplify criteria for certification and permitting Recommendations to the industry for technological innovation: Optimize system technology for high capacity utilization or maximum wind yield Optimize existing support structures or develop new structures Improve installation logistics Intensify research and development Recommendations to the industry for improving efficiency: Develop joint maintenance and installation concepts with several operators Advance serial production 2013 Prognos AG 27

28 Contact Fichtner Water & Wind GmbH Hammerbrookstraße 47b Hamburg Peter Heinrich Tel.: +49 (040) Fax: +49 (040) Internet: