'The chasing pack' | How Southern European floating wind could tip the scales for EU energy

By Brussels’ latest calculus, Mediterranean waters could account for almost a quarter of offshore wind capacity by the end of the decade and over 75GW by 2050, much of it from floating megaprojects off countries including Spain, France, Portugal, Greece and Italy. And many of the biggest sector players are on board. Oil majors Shell, TotalEnergies, Equinor, Orsted, utilities Iberdrola and RWE, and start-ups such as Simply Blue, BlueFloat and Greenalia have all in recent months announced market-inspiriting development aspirations as these nations have unveiled plans for first commercial auctions.

But while this gigawattage is certainly possible — and indeed deemed necessary in light of the impact of the Russian invasion of Ukraine on the regional energy system’s dynamics and Europe’s RepowerEU programme, as many observers have underscored — question marks hang over the sector as it leaves harbour on one of the biggest industrial voyages in history.

“Spain has caught the attention of the offshore wind industry with attractive infrastructure including facilities to build floaters (see panel) and a number of pockets of really excellent wind resource. So, if [Madrid] gets its act together and follows through on the auction promised [in the roadmap] and it has a major developer in [Spanish utility] Iberdrola to push it, then I would feel quite hopeful that it would be able to provide additionality to southern Europe’s ambitions for offshore wind,” Urquhart says.

Current Spanish government timelines point to the possibility of the terms of a lead-off leasing round being finalised and pre-qualification of bidders this year, with the actual auction following in 2023 — but last June it paused all new offshore wind farm projects that had not already put in for “administrative authorisation”, which none had.

“UK and Norway are of course expected to be the floating wind superpowers but if there was a country that could leap forward to challenge them, it could be Spain — certainly for the stepping-stone 250-500MW projects if not the gigascale ones, which would require major port upgrades and so on.

But this is on the longer time horizon, he adds, noting that reports of Lisbon gearing up to hold a gigawatt-scope auction in 2023 is “very unrealistic”.

But even the Canaries, with its historically high-priced diesel-based energy systems might end up being “more for serial demonstration projects” that grow into “step-stone projects supporting green island needs” than utility-scale power production, says Urquhart.

Juan Amate Lopez — who formerly ran Iberdrola’s floating wind business and now heads up developer Greenalia, which has five projects off the Canaries in the works totalling 250MW of capacity — worries that “lawyers and not engineers” are setting the pace for expansion of the Spanish floating fleet.

“All the projects presented so far in Spain are at the ‘initial document’ stage,” he says. “But many of these are not really ‘real’ projects [backed by an engineering plan and environmental permits etc]. The current moratorium almost stops us all.

“Many people appear to be of the opinion that Spanish floating wind should start in the Canaries. The problem I see [as a developer] is that it isn’t ideal that you hold a first auction in an area where there are projects that are now advancing — even if the [paperwork submitted] is only ‘initial documents’. It would confuse the process.

“And the authorities are proposing to do this [hold a first auction next year] just as Spain is going into an election where the outcome is not certain and the government is not strong. Again, not ideal — not least when they are looking at water depths that are [in majority] deeper than 200 metres — when the projects so far have all been under 150 metres. It makes no sense.”

Lopez applauds the Canary Islands government for raising the bar on build-out targets from around 200MW to 430MW by 2030 but cautions that “you can’t prioritise a project over the supply chain” needed to construct it.

“Spain,” he underlines, “has a historical opportunity. We must not let it slip by due to moving too slowly.”

Carlos Martín Rivals, CEO of Spain-based BlueFloat, which has rapidly built up a pipeline of floating wind projects around the world, from Taiwan, through Europe, to South America, sees the Southern Europe play as “absolutely central” to the offshore sector boom lying ahead in the EU.

“Even what we are calling new [offshore wind] markets, including Italy and Spain, the importance of floating is materialising,” he says. “‘Collaboration’ is the keyword — to develop these first projects, to develop the vast supply chains needed, to develop these individual and global markets from nothing as they were into something fundamentally different from the bottom-fixed [sector]. Everything has to be done in parallel.

“Right now by far the biggest challenge — and opportunity — is in the supply chain,” states Rivals. “Look at Europe, you bring all the construction capacity together, what do you get? About 20-30 [floating wind] units per year. That won’t do it.”

This overall emergence of the sector in Europe from niche northern play into something “much bigger [with southern EU market development] is hugely encouraging,” he says. “Spain, Italy, both, could grow quickly if the right approach is used — which we believe is about local investment, local supply chain, local engagement as opposed to central administration on approvals and so on because that will follow if you get the people onboard in understanding the benefits of floating wind.”

Ditlev Engel, CEO of DNV’s energy systems division, notes: “DNV’s latest research shows that 51% of the energy sector’s senior executives in France, Portugal and Spain expect to increase focus and investment in floating wind in the year ahead, which shows how great the impetus is on the industry side in these countries.

“We welcome the emergence of great enterprises like Windfloat Atlantic, EolMed [off France] or the floating projects off the coasts of the Canary Islands and Cantabria, but countries like France, Portugal and Spain still need more ambitious and proactive policies if they are to maintain their advance in the field.

“They are still forerunners at this time, but it is worth noting that projects that were introduced later in South Korea, for instance, will be in operation sooner, thanks to fewer regulatory roadblocks and speedier procedures.”

Urquhart returns to the fact that “there is no shortage of huge capacity potential [in offshore wind in Southern Europe] but it remains a question of what will be supported by the EU and the individual country governments”.

“France — will it finally get moving meaningfully [after the until-now go-slow development of its bottom fixed wind farms]? Will Spain follow through and put real money into this — project subsidies and investment in ports and so on? Could Portugal, Greece, Italy surprise us? Could these first commercial auctions disappoint, and what impact would this have on market sentiment? The optics could look ugly.”

There is “overriding public interest” of offshore wind in the EU — for both climate action and energy security, agrees Urquhart, but he says that the European Commission’s ambitions can only be met with “concrete legislation” in the relevant member states.

Rivals agrees: “Once we have that we are going to see — in the same way we have seen a floating wind industry developing in the northern seas — a big industry developing in the Mediterranean. France, Spain, Portugal, Italy, Greece, it is all going to get moving very fast then in Southern Europe.”