Significant savings on nearshore wind farms

There are significant savings to the community when it comes to developing nearshore wind farms, compared to that of offshore wind parks located more than 20 kilometres from the coast. This conclusion comes from a new analysis produced by the consulting firm KPMG for HOFOR and European Energy A/S. 

Denmark’s CO2 emissions must be reduced by 70 per cent by 2030. The nearshore wind farms can help achieve this ambitious target in a cost-effective manner, says the KPMG analysis. The analysis sets out a number of scenarios based on publicly available data, where the upcoming large Danish offshore wind farm “Thor” of 1000 MW is compared with five nearshore wind farms with a total corresponding capacity. The result shows a socio-economic gain of 2-14 percent for the combined nearshore wind farms, when compared to the larger park. The gain varies in the analysis according to different scenarios. 

“From this analysis, it is reasonable from a socio-economic point of view, to establish nearshore wind as part of the Danish energy mix. The green transformation of our energy sector is a gigantic task that requires extremely large investments. Coastal sea wind can contribute to reducing the cost of future Danish offshore wind turbine capacity by billions, “said Jan Kauffmann, Director of Economics and Business, HOFOR.

In particular, the shorter distance to the shore and lower water depth make it cheaper to establish the nearshore farms. 

Connecting to the electricity grid is cheaper
Currently, HOFOR is developing two nearshore wind farms, while European Energy is working on three parks in addition to a test park off Frederikshavn. All five parks are able to use existing onshore infrastructure to relocate the electricity produced to consumers, unlike the large North Sea parks where expensive offshore transformers and onshore grid reinforcement are needed.

 “In addition, the report does not include the costs of strengthening the electricity grid that is necessary when connecting a large offshore wind farm, which would be passed on to consumers. It is an expense that can run into billions, and is not needed for the nearshore wind farms, “said Knud Erik Andersen, CEO of European Energy

An energy mix with nearshore wind farms is necessary to reach the goal of the green transition as cheaply as possible. Both European Energy and HOFOR emphasize that it is obvious for Denmark to exploit the favorable wind conditions in the North Sea, but that both solar, onshore winds, nearshore wind farms and biogas have a natural place in the Danish energy mix, as each technology has specific advantages that complement the others.

 “We can’t count on offshore wind in the North Sea creating the entire green transition. It is too expensive and risky for security of supply, which becomes stronger when we have a mix of different technologies and renewable energy facilities. The analysis shows that nearshore wind is cheap, quick to establish, and easier to locate near the major cities where there is demand for power. Given how big a task the green transition is, coastal wind is an important solution to reach that goal,“ noted Jan Kauffmann. 

Finally, KPMG’s report confirms that the setup of several smaller nearshore wind farms will increase security of supply, as a breakdown of a cable connection to land will affect only one of the parked parks, as opposed to a large offshore wind farm where cable breakdowns can stop the supply of all electricity.

Facts: What are nearshore offshore wind turbines?
Nearshore wind turbines are – as the name says – turbines that are built closer to the shore. In KPMG’s analysis, the distance is set to between 5 and 15 km from land. The water depth at this distance to shore is lower (10-20 m.). These conditions save on the construction costs of the turbine foundation, cables, grid connection and maintenance. 

Facts: Benefits of nearshore wind farms:
• Lower CAPEX costs.

• Increased security of supply.

• Possibility for local residents to become co-owners (for turbines that are within 16 km of the coast, the purchase right scheme applies, and local residents can therefore buy shares in the turbines).

• Possibility of integration with the energy infrastructure in Copenhagen, where the wind turbine stream can support green district heating, for example, through the electrification of large heat pumps.