Although the E.U. is committed to take action for the climate and to meet the Kyoto and Paris Agreement requirements by using renewable energy sources like wind, current renewable capacity doesn’t guarantee energy supply security. To increase the capacity, the countries seek to conduct innovative onshore and offshore activities. For many years, offshore wind energy technology becomes more important for European energy policy.
Even if the North Sea countries have a serious capacity, most of them still aim to increase their offshore production levels. To realize this aim, Denmark, Germany, the U.K., the Netherlands, Norway, Sweden, and Belgium decided to build an artificial islands system to generate electricity from wind in the Dogger Bank area (Dutch Exclusive Economic Zone). This project is known as the North Sea Wind Power Hub (the NSWPH).
It is a long-term hub and spoke project. It is regarded as technologically and economically feasible due to the large wind capacity of the geography and relatively inexpensive and innovative cable connections to the territorial area. The project has three main goals: to develop a bridge that will provide electricity trade between the North Sea countries, to make the conversion and distribution of electricity easier, and to offer a place for constructors and maintenance operators who experience some difficulties in the offshore activities.
The NSWPH also requires detailed strategic plans of countries and companies together. There is a need for technological and cost-benefit analysis, which should be supported by energy security and climate policies. Even if the building this kind of power hub on artificial islands sounds unrealistic, many experts believe that it’s more important to put a vision and to start the feasibility studies immediately rather than to continue using the traditional energy sources. All these actions can be more effective with the national and the E.U. based support in terms of decisions and regulations.
The foremost point of this project is the emphasis on energy cooperation among these countries to fulfill climate change goals and energy sector developments.
The Consortium of the project mainly aims to make the offshore wind industry more sustainable and efficient by dedicating itself to ensure coordination and securing the supply and demand for energy without harming the environment. Thanks to this kind of project, Europe’s ambition on decarbonization can show marked improvement by the stronger national desire and international cooperation.
The Consortium has indicated that in the 2030s, the first hub of the NSWPH will be electrically connected to the shore. As a result, the European current installed wind capacity will be increased to 150-180 GW by 2045. However, due to the COVID-19 effects on politics, economy, and energy markets, the financial supports for the offshore wind projects that are framed by some practices like feed-in tariffs, regulations, and policies will be affected and maybe dramatically changed. It is expected that the Consortium, which includes several big energy companies like TenneT Netherlands, TenneT Germany, Energinet, Gasunie, and Port of Rotterdam, will face some financial difficulties.
It is also expected that the industry and the Consortium, will see a negative trend because the trillions of euros will be spent to stimulate the economies in the wake of the recession. Weaken climate change actions will emerge due to the possible reductions in Green Deal policies and investments. So, the E.U. and the U.K. as parties of the NSWPH will probably be evaluated as politically, institutionally, and economically unprepared for a crisis in their markets.
Moreover, there will be some problems in the equipment production process not only in Germany or Denmark but also in the U.S. and China as the biggest equipment producer and exporter for the first-mentioned countries. It is expected that the wind industry will face severe impacts of logistic problems too. One of the main reasons is that there is a mutual interdependency situation in the supply of wind turbines, and this project is a big-scale wind hub that requires so many exported turbines.
From a general perspective, it can be said that the recovery progress after the pandemic will be hard for the wind industry because construction activities and installations will depend on the length of national lockdowns, and some construction restrictions might delay the NSWPH’s schedules while increasing costs for developers.