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Cost reductions for offshore wind power: Exploring the balance between scaling, learning and R&D


  • van der Zwaan, Bob
  • Rivera-Tinoco, Rodrigo
  • Lensink, Sander
  • van den Oosterkamp, Paul


Offshore wind electricity generation is prospected to increase substantially in the near future at a number of locations, like in the Baltic, Irish and North Sea, and emerge at several others. The global growth of offshore wind technology is likely to be accompanied by reductions in wind park construction costs, both as a result of scaling and learning effects. Since 2005, however, significant cost increases have been observed. A recent surge in commodity prices proves to constitute one of the main drivers of these cost increases. This observation begs the question whether wind turbine manufacturers should return to the laboratory for undertaking R&D that explores the use of alternative materials and bring offshore wind energy closer to competitiveness. It is demonstrated that if one abstracts from material price fluctuations, in particular for metals such as copper and steel, turbine production plus installation cost data publicly available for a series of offshore wind park projects (realized in several European countries since the 1990’s) show a cost reduction trend. Hence various other sources of cost increases, such as due to the progressively larger distances from the shore (and correspondingly greater depths at sea) at which wind parks have been (and will be) built, are outshadowed by cost reduction effects. When one expresses the overall cost development for offshore wind energy capacity as an experience curve, a learning rate is found of 3%, which reflects a mixture of economies-of-scale and learning-by-doing mechanisms. Also the impact is quantified on offshore wind power construction costs from the recent tightness in the market for turbine manufacturing and installation services: without the demand-supply response inertia at the origin of this tightness it is estimated that the learning rate would be 5%. Since these learning rates are relatively low – in comparison to those observed for other technologies, and in view of the high current capacity costs of offshore wind in comparison to onshore wind energy – a renewed focus on learning-by-searching or R&D is recommended.

Suggested Citation

  • van der Zwaan, Bob & Rivera-Tinoco, Rodrigo & Lensink, Sander & van den Oosterkamp, Paul, 2012. "Cost reductions for offshore wind power: Exploring the balance between scaling, learning and R&D," Renewable Energy, Elsevier, vol. 41(C), pages 389-393.
  • Handle: RePEc:eee:renene:v:41:y:2012:i:c:p:389-393 DOI: 10.1016/j.renene.2011.11.014

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    References listed on IDEAS

    1. McDonald, Alan & Schrattenholzer, Leo, 2001. "Learning rates for energy technologies," Energy Policy, Elsevier, vol. 29(4), pages 255-261, March.
    2. Snyder, Brian & Kaiser, Mark J., 2009. "A comparison of offshore wind power development in europe and the U.S.: Patterns and drivers of development," Applied Energy, Elsevier, vol. 86(10), pages 1845-1856, October.
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    Cited by:

    1. Ederer, Nikolaus, 2015. "Evaluating capital and operating cost efficiency of offshore wind farms: A DEA approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 42(C), pages 1034-1046.
    2. Levi, Peter G. & Pollitt, Michael G., 2015. "Cost trajectories of low carbon electricity generation technologies in the UK: A study of cost uncertainty," Energy Policy, Elsevier, vol. 87(C), pages 48-59.
    3. Wei, Max & Smith, Sarah J. & Sohn, Michael D., 2017. "Experience curve development and cost reduction disaggregation for fuel cell markets in Japan and the US," Applied Energy, Elsevier, vol. 191(C), pages 346-357.
    4. Wüstemeyer, Christoph & Madlener, Reinhard & Bunn, Derek W., 2015. "A stakeholder analysis of divergent supply-chain trends for the European onshore and offshore wind installations," Energy Policy, Elsevier, vol. 80(C), pages 36-44.
    5. Lion Hirth, 2015. "The Optimal Share of Variable Renewables: How the Variability of Wind and Solar Power affects their Welfare-optimal Deployment," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    6. Zountouridou, E.I. & Kiokes, G.C. & Chakalis, S. & Georgilakis, P.S. & Hatziargyriou, N.D., 2015. "Offshore floating wind parks in the deep waters of Mediterranean Sea," Renewable and Sustainable Energy Reviews, Elsevier, vol. 51(C), pages 433-448.
    7. Voormolen, J.A. & Junginger, H.M. & van Sark, W.G.J.H.M., 2016. "Unravelling historical cost developments of offshore wind energy in Europe," Energy Policy, Elsevier, vol. 88(C), pages 435-444.
    8. Sascha Samadi, 2016. "A Review of Factors Influencing the Cost Development of Electricity Generation Technologies," Energies, MDPI, Open Access Journal, vol. 9(11), pages 1-25, November.
    9. repec:eee:rensus:v:82:y:2018:i:p3:p:2346-2364 is not listed on IDEAS
    10. Madariaga, A. & de Alegría, I. Martínez & Martín, J.L. & Eguía, P. & Ceballos, S., 2012. "Current facts about offshore wind farms," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(5), pages 3105-3116.
    11. Enevoldsen, Peter, 2016. "Onshore wind energy in Northern European forests: Reviewing the risks," Renewable and Sustainable Energy Reviews, Elsevier, vol. 60(C), pages 1251-1262.
    12. Gernaat, David E.H.J. & Van Vuuren, Detlef P. & Van Vliet, Jasper & Sullivan, Patrick & Arent, Douglas J., 2014. "Global long-term cost dynamics of offshore wind electricity generation," Energy, Elsevier, vol. 76(C), pages 663-672.
    13. Schwanitz, Valeria Jana & Wierling, August, 2016. "Offshore wind investments – Realism about cost developments is necessary," Energy, Elsevier, vol. 106(C), pages 170-181.
    14. Schmitz, Matthias & Madlener, Reinhard, 2012. "Economic Feasibility of Kite-Based Wind Energy Powerships with CAES or Hydrogen Storage," FCN Working Papers 16/2012, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
    15. Marisa Beck, Randall Wigle, 2014. "Carbon Revenue: Recycling versus Technological Incentives," LCERPA Working Papers 0079, Laurier Centre for Economic Research and Policy Analysis, revised 13 Jan 2014.
    16. Felix Groba & Barbara Breitschopf, 2013. "Impact of Renewable Energy Policy and Use on Innovation: A Literature Review," Discussion Papers of DIW Berlin 1318, DIW Berlin, German Institute for Economic Research.
    17. Zhao, Xin-gang & Ren, Ling-zhi, 2015. "Focus on the development of offshore wind power in China: Has the golden period come?," Renewable Energy, Elsevier, vol. 81(C), pages 644-657.


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