Floating offshore wind rises despite high-cost concerns: "Growth is slow, but competitiveness is sufficient"

"Floating offshore wind is a sufficiently competitive market."

On the 2nd (local time), CEO David KARAkosa of Citec Offshore Technologies, met at 'BiMEP' near the coast of Biscay in the Basque Country, northern Spain, drew a line against views expressing concern over the high business costs of floating offshore wind. He stated that it is premature to judge economic viability based solely on the current situation, given that the market is still in its early stages. 'Citec Offshore Technologies,' established as a spin-off from Citec Engineering in 2016, developed 'SATH,' a concrete floating platform for offshore wind turbines. The company is currently participating in bids for offshore wind projects worldwide and pushing to expand its business.

Unlike existing fixed-bottom systems that anchor structures to the seabed, floating offshore wind involves installing wind turbines on floating bodies buoyed at sea and maintaining their position with mooring systems. It is attracting attention as a technology that can broaden the scope of offshore wind by enabling turbine installation in deep-water areas where fixed-bottom installation is difficult.

CEO David cited a floating offshore wind project currently operating in France as an example demonstrating price competitiveness. He explained, "Currently, electricity rates for one project in France are recorded at around 86 to 93 euros per MWh (megawatt-hour)," adding that this is a very interesting result considering that fixed-bottom offshore wind, which began in the 1990s, had not dropped below 100 euros per MWh until 2020. He further asserted, "As the market becomes fully active and large-scale projects increase, costs can be sufficiently reduced."

Citec Offshore Technologies is concretizing floating offshore wind projects in France, the United Kingdom, Japan, and elsewhere. Among secured orders is a complex in France featuring three 700 MW-class offshore wind facilities. CEO David emphasized, "In the future, we will reach the stage of supplying engineering solutions and manufacturing platforms."

The company continues testing at BiMEP, a grid-connected offshore demonstration test site located in the waters off Biscay, to refine SATH technology. BiMEP is jointly owned by the Basque Energy Agency and the Energy Diversification and Savings Organization (IDEA), and has been operational since 2015. The 'DemoSATH' installed there is Spain's first grid-connected floating offshore wind turbine, achieved in 2023.

CEO David predicted that the floating offshore wind market will fully open around 2032 to 2033. This is because large-scale commercial projects currently undergoing bidding in Europe are expected to begin full operation from this period.

In fact, companies in the Basque Country are expanding their operations to prepare for the blossoming of the floating offshore wind market. 'BCN Marine,' which has supplied mooring systems to major domestic shipbuilders such as HD Hyundai and Hanwha Ocean, as well as companies from various countries worldwide, recently expanded its scope into mooring chains for floating offshore wind. Javier Aguirre, Sales Director for Renewable Energy Projects at BCN Marine, met on the same day, stated, "If the market grows according to current forecasts, we will be able to supply a considerable volume of mooring chains annually." He added, "In the case of floating offshore wind, more chains are required than for existing Floating Liquefied Natural Gas (FLNG) production facilities or Floating Production, Storage and Offloading (FPSO) units, making profitability substantial."

The government and domestic companies are also engaging in R&D and demonstration for floating offshore wind, but they have not been able to gain much speed. The 'Firefly Floating Offshore Wind' project that Norwegian energy company Equinor had been promoting in Ulsan was also suspended. However, local industry officials had no disagreement regarding the long-term growth potential of floating offshore wind.

Director Javier said, "We are aware that the market's growth speed is slower than we expected," expressing confidence by adding, "If it passes the commercialization stage and related regulations in various countries improve, it can bring much higher value-added." He further added, "We expect related projects to be promoted in Korea, centered on coastal areas such as Busan."