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EU Blue Economy Observatory
  • News article
  • 30 October 2024
  • 3 min read

Ambition to transform the North Seas into “Europe’s green power plant"

Energy Ministers of the 9 North Seas countries have held their annual meeting in Odense, Denmark, reaffirming their ambition to transform the North Seas into “Europe’s green power plant.” 

They gave clear recommendations to the new EU Commission on how best to support that. It will discuss how to strengthen Europe’s wind energy supply chain. Also, ensuring hybrid offshore wind farms are moving – by defining a cost-sharing formula asap and creating a new dedicated offshore financing facility. They also highlight the importance of involving the UK in this.

At North Seas Energy Cooperation (NSEC) Ministerial Meeting in Odense, Denmark, European and national politicians as well as industry representatives reaffirmed the strategic role of the North Seas as Europe’s future renewable energy powerhouse.

In a joint NSEC declaration, the Energy Ministers of Belgium, Denmark, France, Germany, Ireland, Luxembourg, the Netherlands and Norway yesterday identified six critical areas of collaboration. Among them are the competitiveness of Europe’s offshore wind supply chain and the need to reinvent offshore wind financing.


Rethinking approach to offshore wind planning

With the large offshore wind volumes installed in the North Seas over the next years, national supply chain planning will not suffice. Investments in new and expanded factories require international cooperation and coordination at the sea-basin level. A strong European supply chain is a prerequisite for the further build-out of offshore wind. It’s good that the EU supports that now – with tighter pre-qualification criteria on cybersecurity, responsible business conduct and the ability to deliver on projects enshrined in law.

The NSEC recommendations call for a “digital transparency tool” that provides visibility for the entire wind energy value chain. The tool should serve as an overview of auction schedules, manufacturing capacities, equipment requirements and port capacities across the North Seas countries. Ultimately, it is envisaged that it will cover all of Europe, including the UK and Norway. Generally, the NSEC recommendations call for “a more effective and constructive cooperation between the UK and NSEC.”

Supply chain bottlenecks remain, especially regarding the availability of offshore wind installation and service vessels, port infrastructure, the expansion and reinforcement of onshore grid connections and the availability of skilled workers. But the European offshore wind supply chain is ramping up. By the end of 2025, Europe can manufacture 9.5 GW of offshore wind turbines a year.

European companies are investing at least €10bn to build new factories and expand existing ones – for everything from wind turbines to foundations, cables and grid equipment. Europe must continue facilitating access to capital, enabling a level playing field with non-European competitors, boosting the grid buildout – and the European supply chain will deliver.

Reinventing offshore wind financing

With the European Wind Power Package and the EU Grids Action Plan, the European Commission has taken a series of significant steps to back investments in the wind industry and its supporting infrastructure. The European Investment Bank (EIB) has stepped up to support for Europe’s wind industry with crucial counter-guarantees. But additional steps at regional level are needed to facilitate investments – not least in hybrid offshore wind farms which connect to two or more countries, energy islands and meshed grids.

The NSEC recommendations call for a new approach to offshore financing. Preliminary discussions on establishing an “offshore regional facility” to unlock financing at sea-basin level have started. The facility could support funding of meshed grid infrastructure and hybrid offshore projects and help overcome persisting questions on cost-, risk- and benefit sharing between the actors involved. Europe needs to set the regulatory framework and define a cost-sharing formula for hybrid offshore wind projects asap. Hybrid projects are the future of offshore wind in the North Seas, and the focus must now be on getting the first projects built.

The facility would be based on voluntary cooperation between the European Commission, Member States, private investors and possibly non-EU countries which could support offshore projects. WindEurope welcomes the proposed “offshore regional facility.”

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Publication date
30 October 2024