The global acceleration of offshore wind installations is driving the need for dependable infrastructure to transmit the generated power onshore and into the electrical grid.
This surge has ignited a significant demand for offshore substations, especially in Europe. Rystad Energy’s research and modeling indicate that 137 substations, requiring a total investment of $20 billion, will be deployed in continental Europe this decade.
A majority of these facilities, over 120, are slated for installation between 2024 and 2030 at an estimated cost of $18 billion. This translates to a steady increase in annual spending on offshore substations, escalating from an average of $1.4 billion between 2015 and 2023 to a peak of $8.4 billion in 2030.
Crucial Role of Substations in Offshore Wind
Substations play a pivotal role in the offshore wind industry, collecting the power generated by wind turbines, boosting the operating voltage, and transmitting the electricity to shore.
The primary electrical system of an offshore substation comprises switchgears, transformers/converters, a reactive power compensation system, and an earthing system.
These substations are especially advantageous for projects exceeding 200 MW in capacity and located over 15 km from the shore, as they help minimize power transmission losses.
Additionally, they are valuable for other energy initiatives, such as electrifying offshore oil and gas platforms.
Drivers of Substation Growth
The growth in substation development is fueled by the increasing scale of offshore wind projects and their distance from the shore, with projects surpassing 1 GW in capacity necessitating multiple substations.
Ambitious offshore wind installation targets set by many European countries are transforming the continent into a hub for substation activity. Europe is poised to install eight new offshore substations in 2024 alone, doubling the number from last year.
While this year’s new installations will be limited to projects within 50 km of the coast, a notable increase in installations beyond this distance is expected in the latter half of the decade, further driving the need for offshore substations.
Spending Surge and the Rise of Floating Wind
Petra Manuel, Senior Offshore Wind Analyst at Rystad Energy, predicts a substantial increase in spending within the offshore substation market this decade.
This surge is tied to the growing installed capacity in Europe and will be further amplified with the rise of floating wind technology. The distant location of floating wind turbines from the shore could lead to the first floating substations by the early 2030s.
Components of Offshore Substations
Offshore substations consist of two main components: the topside, housing the main electrical power system, auxiliary systems, and the topside housing; and the foundation, supporting the weight of the topside structure.
Jackets, fixed to the seabed with piles at each leg, have been the preferred foundation concept for most offshore substations due to their ability to support larger and wider structures. However, some projects have also utilized monopiles driven directly into the seabed.
Historical Trends and Future Outlook
The topside of an offshore substation can be substantial in size and weight, much heavier than a wind turbine. Of the nearly 100 offshore substations installed in Europe between 2014 and 2016, jackets dominated with an almost 70% share, while monopiles accounted for less than a quarter. The foundation concepts for some substations planned for 2025 and 2026 are yet to be determined, noted as unspecified in Rystad’s research.