Many energy experts agree that the majority of future wind energy projects will go offshore, especially because of the constantly decreasing costs in the sector. In 2021, the cost of installed offshore wind energy worldwide averaged 2,858 U.S. dollars per kilowatt, which is a decrease of over 12 percent compared to 2020. In 2011, for instance, the cost of installed offshore wind turbine was at more than 5,500 dollars per kilowatt.
Offshore wind energy projects have one big advantage over the wind energy projects on land, namely more frequent and more powerful winds. Some recent studies have showed that offshore winds blow 40 percent more often offshore than on land which means that offshore wind farms can relatively easy outpace wind projects on land in terms of installed capacity.
The main disadvantage of offshore wind energy farms are higher construction costs compared to the wind farms on land. Offshore wind energy projects need to be powerfully built in order to withstand rough weather conditions; the costs of installing a wind turbine on land were 1,325 U.S. dollar per kilowatt in 2021, which means that offshore wind projects still have a long way to go before being cost-competitive with wind energy projects of land. This is the main reason why offshore wind farms need to be built large, or otherwise they are not economically viable.
Offshore wind energy market despite is constantly growing despite the high construction costs of new offshore wind energy projects. Some recent studies have calculated that that return on investments for offshore developments can be as high as 18 percent which gives some certainty to investors, especially in combination with incentives and other tax benefits. But in average targeted returns for offshore wind projects are in the 7%-8%.
Offshore wind technologies are still in the relatively early phase of the development, and further technological advances should make future offshore wind energy projects much more commercially viable compared to the current offshore wind farms.
Offshore wind farms have significantly smaller negative impact on aesthetics of the landscape compared to wind farms on land because most offshore wind farms are not visible (or barely visible) from shore. From the environmental point of view, when constructing offshore wind farms constructors have to make sure not to disturb nearby marine ecosystems too much. The constructors also must be careful not to build offshore wind farms in areas where they would interfere with shipping lanes, or in fishing areas.
Another advantage that offshore wind energy projects have over wind energy projects on land is transport. The transport of big wind turbine components such as tower sections, nacelles, and blades is significantly easier with ships as they can handle large cargo more easily than trucks or trains, and there is no traffic jam on sea like there is on land.
Offshore wind energy is clean, renewable energy source that can reduce the need for fossil fuels, and by doing so help tackle climate change and air pollution.
Global installed offshore wind capacity reached 54.9GW by the nd of June 2022, with more than half oh this capacity being installed in EU (28.4 GW).