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Earth Power

Norfolk Coast Giant Offshore Windfarm Halted Due To Spiralling Costs 63

Slashdot reader sonlas writes: The government's green energy plans faced a setback as the Norfolk Boreas offshore windfarm project by Vattenfall was halted due to soaring supply chain costs and rising interest rates. Vattenfall's chief executive Anna Borg said: "It's important to understand that our suppliers are being squeezed. They have problems in their supply chain so it's not so easy to mitigate these situations."

The 40% increase in expenses was driven by high global gas prices impacting manufacturing costs, making the project unprofitable. The decision to halt work on the Norfolk Boreas windfarm has cost Vattenfall £415 million, but Borg said the move was "prudent" given the impact of costs on the project's future profitability.

In a related news, energy majors BP and TotalEnergies have won a 7GW offshore wind site auction in Germany worth a record $14.1 billion. However, even back in 2022 market experts were warning governments that those additional costs for energy producers have negative impacts. It is important to bear in mind that negative bidding places extra financial burdens on wind farm developers. These additional costs need to be transferred to someone else, either to consumers through increased energy bills or to suppliers, as the developers have less money to invest in the turbines.

Those two news are related in the sense that what has been shown so far is that in a world where fossil fuels are cheap and abundant, renewables, and especially offshore windfarm, are cheap and easy to deploy. However, signs are pointing toward a world where fossil fuels supply is not as cheap and abundant as expected, and that may have an impact on plans made by governments to reach Net Zero, or to even just reduce their CO2 emissions.
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Norfolk Coast Giant Offshore Windfarm Halted Due To Spiralling Costs

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  • A link and a quote (Score:5, Informative)

    by ndsurvivor ( 891239 ) on Saturday July 22, 2023 @03:40PM (#63707362)
    https://www.reuters.com/sustai... [reuters.com] "Vattenfall logo is seen on its headquaters in Stockholm, Sweden April 18, 2016. REUTERS/Pontus Lundahl/TT News Agency/File Photo LONDON, July 20 (Reuters) - Swedish utility Vattenfall (VATN.UL) is stopping the development of the 1.4 gigawatt (GW) Norfolk Boreas offshore wind project off the coast of Britain, designed to power around 1.5 million homes, it said in an earnings statement on Thursday. The company said the decision would have an impact on earnings of 5.5 billion Swedish crowns ($537 million). The project won a contract-for-difference (CfD) in an auction last year, guaranteeing a minimum price of 37.35 pounds per megawatt hour (MWh) in 2012 prices for the electricity produced, which equates to around 45 pounds/MWh today."
  • Where is this (Score:4, Insightful)

    by test321 ( 8891681 ) on Saturday July 22, 2023 @03:46PM (#63707370)

    The government's green energy plans faced a setback as the Norfolk Boreas offshore windfarm project

    Which government, and which Norfolk?

  • by ffkom ( 3519199 ) on Saturday July 22, 2023 @03:55PM (#63707386)

    The 40% increase in expenses was driven by high global gas prices impacting manufacturing costs, making the project unprofitable.

    That sounds kind of ironic. Was wind energy not supposed to replace ever more expensive fossil fuels?

    • The 40% increase in expenses was driven by high global gas prices impacting manufacturing costs, making the project unprofitable.

      That sounds kind of ironic. Was wind energy not supposed to replace ever more expensive fossil fuels?

      They are only "ever more expensive" if you factor in all the carbon taxes, and subsidies on everyone else.

      • by gtall ( 79522 )

        To be balanced against the cost of global warming because people like you are too dim to see the connection.

        • No, the taxes actually do jack shit about global warming, in fact worsen the problem by encouraging production to move from West, where they are subject to some regulation, to China, where they can pollute with impunity all they want. Sorry to burst your bubble, but that's always what happens when you put leftists in charge: wealth transfers instead of actual solutions.
          • by drhamad ( 868567 )
            Then the solution to this would seem to be to tariffs, no?
        • Correct. The calculus goes something like this. The wind farm will stop global warming. The wind farm will cost $x (sorry, no pound sterling symbol on my keyboard). Global warming if unchecked will cause extinction of all life on earth. Therefore global warming will cost $infinity. Therefore wind farm should be built because x infinity.

    • by Luckyo ( 1726890 ) on Saturday July 22, 2023 @05:11PM (#63707482)

      Wind power increases usage of expensive fossil fuels, because it requires spinning reserve for 100% of power it produces. Just look at German Energiewende progression vs number CCGTs built and spun up to back it up. And gas everywhere but in couple of overproducing nations of the world is much more expensive than coal. UK which is the country this story is about isn't an overproducing country as an example.

      It decreases usage of slow ramp up forms of power however. So nuclear, geothermal, trash burners, coal. Granted if you're Germany and allowed Greens to dictate policy, you end up with lignite backup for wind. At which point you get to cooking books to at least pretend you're not committing a crime against nature, because coal must be spun up and under nominal load to be able to take load in reasonable amount of time when wind cuts out. Which Germans decided not to count as emissions from their electric grid power generation, because coal isn't generating power. It's producing waste heat into a brake, waiting for wind to drop off so it can take the load.

      The sheer amount of propaganda about wind that is diametric opposite of reality is frankly staggering. My personal favorite is when Germans recently had to increase the size of a lignite mine to feed those wind backup power plants, which ironically resulted in axing a wind farm.

      • What makes you think Germany has "spinning reserve for 100% of power" generated by wind. Not seeing any cites.

        Show evidence that "much more expensive than coal".

      • by AmiMoJo ( 196126 )

        In the UK, renewables have reduced coal generation to near zero, with gas falling too.

        The issue here is nothing to do with "spinning reserve", which the UK doesn't use. It spools up plants as needed based on short term predictions of renewable energy.

        This is to do with the same supply chain issues that have been affecting manufacturing in general. Particularly the difficulty getting hold of raw materials and electronics.

        The same thing has delayed the new nuclear plants that are being built in the UK too.

        • There are only a few very backyard grids that use spinning reserves.
          In fact I don't know any from the back of my mind. Australia perhaps, or Hawaii, and that basically was it.

      • because it requires spinning reserve for 100% of power it produces.
        That is wrong, as Germany shows.

        Or does have Germany 100% spinning reserves for its wind? Obviously not.

        No power company actually is using "spinning reserves", that is extremely uncommon since the 1970s already.

        Perhaps you should read a book about how power production and power grids and power companies actually work.

        Just look at German Energiewende progression vs number CCGTs built and spun up to back it up.
        Exactly. How many? I think abou

  • by oogoliegoogolie ( 635356 ) on Saturday July 22, 2023 @04:06PM (#63707398)

    Each wind turbine uses ~100 gallons of oil in it's gearcase/crankcase/transmission, and that oil needs to be changed once a year. Average windfarm size
    is 100 turbines so that amounts to 10,000 gallons of oil needed in a year. A gallon of synthetic engine oil is ~$50 so a very rough estimate for annual wind turbine "oil changes" is $500,000 for a windfarm with 100 towers.
    Plus other moving parts need to be regulary greased, which also comes from oil.

    Price of oil goes up, price of renewables also goes up. Oh the irony!

    • They should shop at Walmart, 5 quarts of full synthetic can had for $25. And why would a gearbox need so frequent of changes - do they not have filtration?

      They blamed increased manufacturing costs though and not maintenance costs, so this is all moot.
      • They should shop at Walmart, 5 quarts of full synthetic can had for $25. And why would a gearbox need so frequent of changes - do they not have filtration?

        Filtration is not enough.

        Oil contains long hydrocarbon chains, and over time the individual molecules get broken apart by the physical action of the moving parts.

        Also the gearboxen are running 24/7. Your car is probably running an hour each day, so 1/24 of the usage time. Also also the wind presents unpredictable and very strong shearing forces on the shafts and bearing surfaces, which causes the oil to wear out more quickly than the relatively constant shearing forces on the bearings inside your car engine

        • But it is a gearbox, so comparing to a transmission would be more apt instead of an actual engine that has contaminating ignition residuals and all that heat exposure.

          Oil and ATF fluid has become so dependable that modern car transmissions only need changing 1/20 the frequency of the engine. The gearbox in my hybrid doesn't even have a drain because it is expected to last the lifetime of the vehicle (it has no torque converter or clutch to contaminate things). Hydrostatic drives almost never need changin
          • The problem with the gearbox oil is that a thin film between the gear faces experiences shearing forces sufficient to pull the long chain hydrocarbon molecules apart. The same applies to the bearings where the main shaft is supported. Higher loads and more runtime directly affect the rate of degradation. The result of all this breakdown is that the oil becomes less viscous, and less effective as a lubricant over time. While filters will remove metal particles and solid contaminants they cannot remove thes

        • Oil contains long hydrocarbon chains, and over time the individual molecules get broken apart by the physical action of the moving parts.
          That is just nonsense.

    • by whoever57 ( 658626 ) on Saturday July 22, 2023 @04:36PM (#63707444) Journal

      Your calculations appear to have a number of problems.
      1. You assume retail cost of synthetic oil is relevant to commercial bulk usage in wind turbines.
      2. Only 80 gallons of oil used at most:
      https://greensolver.net/wind-t... [greensolver.net]
      3. Drain and refill is typically 36 months or longer:
      https://www.mobil.com/en/indus... [mobil.com]
      https://leadstories.com/hoax-a... [leadstories.com]

      I can believe that the oil is sampled for testing annually and replaced if appropriate -- this is probably the source of the false information you are repeating.

    • Just another point in favor of moving away from fossil fuels as energy. Oil and gas have so many more useful applications that it should be considered a colossal waste burning it just to make stuff hot.

      In a world with less fossil fuel energy the idea of using 100's of gallons as lubricant is a non-issue as we will have so much more to use for it.

      • by dryeo ( 100693 )

        Currently, a lot of these lubricants are basically by-products of refining fuel, which makes me wonder if we'll need to replace refineries that are used for fuel with more specialized ones. Be in the future anyways and with planning not likely a problem.

    • by tragedy ( 27079 )

      Each wind turbine uses ~100 gallons of oil in it's gearcase/crankcase/transmission, and that oil needs to be changed once a year. Average windfarm size
      is 100 turbines so that amounts to 10,000 gallons of oil needed in a year. A gallon of synthetic engine oil is ~$50 so a very rough estimate for annual wind turbine "oil changes" is $500,000 for a windfarm with 100 towers.
      Plus other moving parts need to be regulary greased, which also comes from oil.

      Price of oil goes up, price of renewables also goes up. Oh the irony!

      A few things. First, as another poster pointed out, you're probably overstating the cost of the oil by 100% or more. If you can buy gallon jugs of Mobil One full synthetic for $26.97, you can almost certainly get it in bulk, wholesale for even less than that per gallon. Realistically, you're probably overstating the cost per gallon by about 300%. Then there's the fact that you mentioned this for a wind farm with 100 towers. That's a pretty arbitrary (and quite large) number. Why not say that it's a thousand

  • Go nuclear. SMRs. (Score:4, Informative)

    by memory_register ( 6248354 ) on Saturday July 22, 2023 @04:16PM (#63707412)
    Small modular reactors are the future. Cheap, reliable, carbon free energy. If you have not researched them, go spend 20 minutes learning.
    • by Luckyo ( 1726890 )

      Large ones are just fine. France has by far the lowest power generation carbon intensity in the world because it mainly generates from large nukes. Ironically large part of the carbon intensity of power generation there comes from the relatively small portion of wind and solar, which require fast backup, which means CCGTs for 100% nominal output capacity. Which unlike with nuclear where backup turbines can stay shut down almost all of the time, with wind they need to be spun up and take the load many times

      • Sorry, that is just nonsense.
        Read a book about production.

        Or face it: you are an idiot. As long as you do not read up: you stay an idiot.

        Good luck in your life.

    • by AmiMoJo ( 196126 )

      Problem is they aren't cheap. In fact they may end up being more expensive for a given amount of energy output.

      You still need a containment building and cooling pool. The pool must be leak-proof in the most extreme earthquake possible at the site, and there is a whole debate about what magnitude of earthquake you need to design for.

      The only SMRs actually being prototyped are NuScale ones, and they use more fuel than normal reactors. It has to be replaced more frequently too. So you have to build an even big

    • Small modular reactors are the future.

      Yes they are the future. The long distant future that has no impact on climate change or any hope in hell of making any significant difference.

      If you have not researched them, go spend 20 minutes learning.

      Spend more than 20minutes. It sounds like you only just got through the marketing materials, just enough to buy the fantasy that these things exist and are viable today. They are not. Your post may be more relevant in 2050. Assuming we're still around and haven't annihilated ourselves with wars fought over climate change.

    • No one has researched them. And the people promoting them neither. Otherwise everyone would know: they only exist on paper. Because: no one has researched them in the sense of what an engineer calls "research", aka having results that lead to engineering aka lead to construction etc.

    • by tragedy ( 27079 )

      If you have not researched them, go spend 20 minutes learning.

      Is that what you did? Spent 20 minutes learning about them and then made up your mind? Maybe spend a little longer. There are economies of scale in nuclear plants and an ideal range of sizes. Build a plant that's 1/10th that ideal size and you'll get way less than 1/10th the power out of it. Why build 20 SMRs when you can build one regular size plant for less money and get more power out of it for lower maintenance costs? Of course, for that matter, why build a nuclear reactor at all? They're slow, expensiv

  • Spiraling costs? Well, I think i see your problem right there. You should have been using toroidal propellers, not spiral.

    • Spiraling costs? Well, I think i see your problem right there. You should have been using toroidal propellers, not spiral.

      Article title could have said that Costs Were Spinning Out of Control...then the propellers would not modification.

  • Wind farm power costs are pretty much all capital costs. Fossil fuel plants are a combination of capital plus fuel costs. As these two numbers change, the break-even point changes to make what was an economically sound project become less so.

    Capital costs are particularly insidious. Once the money has been spent, you've got to keep making payments. With fuel, if that cost goes up, you can shut the plant down and mitigate some of the expense.

    • by tragedy ( 27079 )

      Wind farm power costs are pretty much all capital costs. Fossil fuel plants are a combination of capital plus fuel costs. As these two numbers change, the break-even point changes to make what was an economically sound project become less so.

      Capital costs are particularly insidious. Once the money has been spent, you've got to keep making payments. With fuel, if that cost goes up, you can shut the plant down and mitigate some of the expense.

      Which would seem to make fossil fuel plants the worst of both worlds, because the only portion of the expense you can mitigate with the fossil plant by shutting it down is the fuel cost. The capital costs remain, just like with the wind farm. The big difference is that the wind farm keeps producing power, and therefore revenue, while the fossil plant just sits there, eating money through capital costs. So you've made a pretty good economic argument for renewable plants that use no fuel over fossil fuel plan

      • by PPH ( 736903 )

        The big difference is that the wind farm keeps producing power, and therefore revenue,

        If someone wants to buy your power. The renewables crowd have yet to come to terms with how utilities schedule resources. By matching supply with demand.

        An interesting thought experiment is to imagine a power plant that has no capital expenses. Only fuel costs. That would be the perfect power plant. Back in my days in the utility biz, we searched for ways to minimize these capital costs. But we were hampered by the old timers thinking that all our generation typically belonged to us. Until some forward thi

        • by tragedy ( 27079 )

          If someone wants to buy your power. The renewables crowd have yet to come to terms with how utilities schedule resources. By matching supply with demand.

          Your assumption that no-one will want to buy the power aside, that/s not really relevant to the You actual argument you were making. You're just changing horses midstream. Basically, your argument was that there are capital costs and fuel costs (also maintenance costs, but you didn't really go into those) and wind power has maintenance and capital costs, but not fuel costs. So, because wind power doesn't have fuel costs, it's all capital (and maintenance) costs. You basically made the argument that capital

  • Shouldn't a link to the original article have been included? I have to think this was deliberately omitted. And then there was 'related news' from elsewhere, which doesn't appear to be related at all.

    Here's the article;
    https://www.theguardian.com/bu... [theguardian.com]

    Inflation, supply chain problems, high interest rates are what was mentioned. The high cost of NG in the EU drove all prices up there, which means they need to move away from that unreliable energy source ASAP.

  • by VeryFluffyBunny ( 5037285 ) on Sunday July 23, 2023 @05:01AM (#63708340)
    They forgot to mention that BP is pretty much a co-owner of the Tory Party & so the Tories have been allowing BP to price-gouge, without restriction or any threat of windfall taxes, in the UK ad-infinitum. They've been making record profits while households & businesses struggle to pay the bills. This is simply a corrupt government allowing corporate profiteering at the expense of everyone else. Meanwhile the Tories are grinding public institutions like the NHS, education, & the judicial system into the ground. Doctors, nurses, teachers, heads, & lawyers are leaving their professions or going overseas in their droves as a result. It's not long before the UK degrades into a 'formerly' developed country. Well, as long as the Tories' sponsors get even richer, it's all alright, isn't it?
  • In the UK the national grid has been slow to provide connection to the grid, which has hindered many projects. Also, for no good reason, the royal family owns the sea bed and gets paid for the licence. This cost should be eliminated to encourage new wind farms. As for the other troupes wheeled out here (variability means more costs more in fossil fuels etc) these are long debunked.

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