In the competitive landscape of renewable energy, a turnkey solution isn't just appealing; it's essential. As market dynamics shift and pressure mounts, only those who adapt will thrive.
We're now seeing a strong appetite among owners and operators for one supplier to provide multiple services for a given wind farm, which is being driven by a number of factors disrupting the sector.
Firstly, the emergence of investment companies and new entrants seeking supply chain partners to support the operations and maintenance of their wind farms has significantly altered the landscape of the marketplace.
Whilst still with the lion’s share, the development of new construction in offshore wind is no longer exclusive to energy utility giants the way it once was. With an already established and mature operational capability, their model was to build, own and operate their own assets. Many developers are now reconsidering the longevity of existing operational models, identifying seasonal underutilisation of staff and a growing need for leaner, more efficient operations to ensure the long term success of the offshore wind market.
This, combined with the scarcity of qualified personnel available to perform essential tasks, has increased OPEX costs putting pressure on financial returns across the sector. My concern is that if specialist service providers fail to adapt to market changes and diversify their service offerings, how do we remain relevant as the renewable energy sector continues to evolve and mature?
The ageing of assets has provided yet another catalyst for a turnkey approach. Round 1 wind farms are fast approaching the end of their predicted life cycle, yet they continue to operate reliably and efficiently. Many operators are seeking licence extensions which has further highlighted the need for long term, sustainable OPEX models for new entrants and longstanding operators.
Alongside the assets themselves, the very nature of the offshore wind market is maturing too. As with any industry when it begins to reach maturity, the offshore wind supply chain is consolidating with mergers and acquisitions, alliances and partnerships all seeking to provide increased value through comprehensive turnkey service offerings.
The price to build a wind farm per MW is significantly less than it was 15 years ago, and as vessels, techniques and services continue to mature, efficiencies are being identified, forcing the supply chain to continuously innovate and identify new areas to add value in order to survive. As we move into the new world, can any service provider afford to ignore the growing demand for a comprehensive high value service offering?
A turnkey solution will, by its very nature, unlock economies of scale and the cost efficiencies operators are desperately seeking. Having as few commercial interfaces as possible makes day to day operations smoother and allows technicians to deliver multiple services in a single visit to a wind turbine.
Not only is this extremely cost effective, but the safety and environmental benefits a turnkey approach provides are significant. Fewer personnel and vessels required to go offshore results in reduced risk and lower fuel consumption, which is what many organisations are striving for alongside cost efficiencies and commercial considerations.
By grouping services together to provide the full range of balance of plant services, customers gain much better value overall. Within our group structure, for instance, we deliver a range of high voltage services through Ventus Energy, and top side balance of plant services through RTS Wind.
This collaborative approach has recently helped Ventus Energy secure a contract with SSE Renewables at Seagreen Wind Farm. We have the opportunity to implement a turnkey model that will provide the blueprint for efficient operations by the long term owner. By providing the full range of services, we’re setting up the asset for an easy transition into the OFTO phase of the operation.
Right now there’s a huge opportunity for Ventus Energy and its sister companies to leverage its collective range of service offerings, providing a long term sustainable business model which is not only successful, but provides maximum value to our clients.
We’re determined to continue disrupting the marketplace with new innovative solutions; we believe we have a critical role to play in the supply chain as the industry evolves. As a group, we have ambitious plans to continue to expand our service offering, seeking to bring further value to the market.
The long term sustainability of renewable energy depends on our sector's ability to innovate and streamline. If the industry continues to find these efficiencies, renewable energy has a bright future, solidifying its role in the global energy mix to deliver the ambition of net zero.
Turnkey solutions are not just the future - they are the only viable way forward.
