Future costs of key emerging offshore renewable energy technologies

Srinivasan Santhakumar, Hans Meerman and André Faaij

Renewable Energy, 2024, vol. 222, issue C

Abstract: A detailed understanding of the technological development pathways of energy technologies will reduce the risks of public energy policy and private investment actions. However, such assessments for emerging technologies, critical for achieving global decarbonization targets, face numerous shortcomings. These shortcomings include limited information at an early development stage, uncertainty in design convergence and performance improvements, and the application of aggregated methodologies in projecting their cost developments fails to explain underlying cost drivers and foresee potential radical changes. This study applies an improved methodology leveraging the merits of quantitative and qualitative methods and shows the technological progress expected for the tidal stream, wave technology, and biofuel production from seaweed in a detailed manner. Tidal stream LCOE declines from 264 €/MWh at 0.1 GW to 61 €/MWh at 50 GW cumulative capacity, with CAPEX, capacity factor, and OPEX contributing to 38 %, 33 %, and 16 % of LCOE reductions. Wave technology LCOE declines from 365 €/MWh at 0.1 GW to 54 €/MWh at 50 GW, with CAPEX, capacity factor, and OPEX contributing 28 %, 59 %, and 7 % of LCOE reductions. For grid connection costs, we assessed several integration choices for both technologies and concluded that sharing grid connection capacity among several installations would lower the transmission costs and serve as a policy incentive for the uptake of such emerging technologies. Further, the bioethanol production cost from seaweed declines from 17.1 €/l at 0.1-million l cumulative output to 4.5 €/l at 50 million l, a 73 % cost reduction in 9 doublings of cumulative output. Identifying fermenting organisms capable of converting the heterogenous monomeric sugars in seaweed is a major limiting factor, resulting in a wide variation in bioethanol yields. Lastly, we also summarized the uncertainties involved in the assessment, their causes, and their impacts on results to improve the understanding of potential development pathways of these technologies.

Keywords: Technological learning; Offshore energy; Cost reduction; Energy policy; LCOE; Decarbonization (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:222:y:2024:i:c:s0960148123017901

DOI: 10.1016/j.renene.2023.119875

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