European companies from the renewable energy sector said on Monday that Europe’s offshore renewable energy industry requires a jump in policy support and funding to get on track as it is currently not big enough to deliver governments’ goals to rapidly expand green power.
Companies from the sector made the joint call ahead of a meeting in Ostend, Belgium on Monday where leaders from nine countries including Germany, France and Britain are set to gather and expected to pledge to more than quadruple offshore wind capacity in the North Sea by 2030.
“Our industry is not large enough today to deliver the nine governments’ commitments and meet the rising demand for renewable electricity and renewable hydrogen,” more than 100 companies and industry groups said in a joint statement, and pledged their commitment to “do everything we can” to ensure new wind farms are manufactured in Europe.
The signatories which included energy firms Orsted, Shell and Equinor, wind turbine manufacturer Siemens Gamesa, Britain’s National Grid, renewable hydrogen equipment manufacturer Nel, and industry group Wind Europe said European industries can manufacture seven gigawatts of offshore wind per year as at 2023 and hitting countries’ targets will require adding more than 20GW per year in a few years’ time.
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Record-high inflation, soaring interest rates, increased seabed leasing fees and volatile energy markets faced by developers in 2022 led to a plunge in final investment decisions in European offshore wind farms.
Although investment has improved so far this year, the companies called for further support without which Europe’s renewables sector could struggle to deliver the build-out needed to hit targets – raising the risk of an increased reliance on imported parts.
Part of the support they want in the sector include increased government and EU funding to expand Europe’s manufacturing of renewable energy components, and inflation-indexed prices in government auctions to support wind farms.
The companies warned the EU against extending its cap on power generators’ revenues, which is due to expire in June. The scheme was introduced last year to claw back cash from soaring power prices and return it to consumers, but was opposed by industry who said it deterred investors.
Story was adapted from Reuters.
