Inbalance in electricity demand and supply could jeopardize offshore wind business case

Eneco Luchterduinen. © MHI Vestas

The Dutch government and industry should take action to keep a healthy business case for offshore wind energy in the future. According to the research ‘The Offshore Wind Business Case and Supporting Intervention’, an inbalance in renewable electricity demand and supply could lead to a negative business case for offshore wind.

The research was performed by research company AFRY, by order of the ministery of Economic Affairs and Climate Policy. It follows from an agreement between the government and the offshore wind industry, as part of the Dutch Climate Act. The goal of the research was to identify the deciding elements in keeping offshore wind cost-effective in the future without subsidies.

An outcome of the research shows that demand and supply should remain in balance. At the moment, the supply of wind energy is growing at a higher rate than the demand. As a result, the business case for offshore wind is under pressure. This could also put the 2030 target (11.5 GW) for offshore wind under pressure.

For offshore wind to continue to grow, so does the demand for green electricity. This should come from the industry or, for example, by a growth in the production of green hydrogen. Measures are required to ensure the demand will grow accoridngly.

Over the next months, the government, offshore wind sector and the industry will investigate what measures will have to be taken to enable offshore wind to remain subsidy-free.

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