Offshore Wind Faces Installation Vessel Shortage – Rystad Energy

The market for vessels capable of installing large offshore wind components is quickly being outpaced by growing demand from the global development pipeline, a Rystad Energy analysis shows.

With offshore wind booming, the global fleet of wind farm installation vessels will be insufficient to meet the demand after 2025, according to Rystad Energy. The analysis excludes offshore wind farms in China and inter-tidal wind farms.

This, Rystad Energy said, will open room for more specialized vessel orders and other oil and gas heavy lift vessel conversions.

When translating the volume of offshore wind projects into vessel years for installation scopes, Rystad Energy estimates that the demand for foundation and turbine installations in 2020 is approximately eight and 13 years, respectively.

On the supply side of the equation, there are currently 32 active turbine installation vessels, with additional five units ordered, and 14 dedicated foundation installation vessels, with another five vessels ordered.

For the past few years, this has effectively resulted in a relatively oversupplied market, especially in Europe.

However, the scale is clearly expected to tip towards an undersupply of installation vessels by the mid-2020s. With more offshore wind projects down the line, Rystad Energy expects installation vessel demand will be four to five times higher than today’s figure by 2030.

Moreover, there are currently only four vessels capable of handling the next generation of turbines, such as GE’s Haliade-X which is expected to be commercial in 2021. As technology advances and future-generation wind turbines will get even bigger, the existing fleet of vessels is not likely to have enough capacity to install them, according to Rystad Energy.

“We identify the heavy-lift vessel segment as the key bottleneck for offshore wind development from the middle of this decade, and the need for next generation vessels may slow the cost reductions expected in offshore wind,” said Alexander Fløtre, Rystad Energy’s Product Manager for Offshore Wind.

From 2014 onward, offshore wind turbine sizes began to increase substantially, especially in Europe, and with them the need for larger crane capacities and lifting height. Early players in the vessel market were able to anticipate this shift and optimize fleets to serve these larger projects. Nevertheless, it is evident that competitive features that were considered “high-spec” only three years ago are already outdated, Rystad Energy said.

“Looking ahead, vessels will have to serve the initial construction phase of projects, in addition to maintaining and periodically replacing the active base of equipment. The segment that will succeed in serving the future needs of the offshore wind industry will be able to offer this valuable synergy to support a healthy fleet utilization,” Fløtre said.