How Expensive Is Expensive Enough? Opportunities for Cost Reductions in Offshore Wind Energy Logistics.

Thomas Poulsen, Charlotte Bay Hasager

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Abstract

This paper reveals that logistics may conservatively amount to 18% of the levelized cost of energy for offshore wind farms. This is the key finding from an extensive case study carried out within the organization of the world’s leading offshore wind farm developer and operator. The
case study aimed to, and produced, a number of possible opportunities for offshore wind cost reductions through logistics innovation; however, within the case study company, no company-wide logistics organization existed to focus horizontally on reducing logistics costs in general. Logistics was not well defined within the case study company, and a logistics strategy did not exist. With full life-cycle costs of offshore wind farms still high enough to present a political challenge within the European Union in terms of legislation to ensure offshore wind diffusion beyond 2020, our research presents logistics as a next frontier for offshore wind constituencies. This important area of the supply chain is ripe to academically and professionally cultivate and harvest in terms of offshore wind energy cost reductions. Our paper suggests that a focused organizational approach for logistics both horizontally and vertically within the company organizations could be the way forward, coupled
with a long-term legislative environment to enable the necessary investments in logistics assets and transport equipment.
Original languageEnglish
Article number437
JournalEnergies
Volume9
Issue number6
Number of pages23
ISSN1996-1073
DOIs
Publication statusPublished - 2016

Bibliographical note

© 2016 by the authors; licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC-BY) license (http://creativecommons.org/licenses/by/4.0/).

Keywords

  • Offshore wind
  • Logistics
  • Logistics innovation
  • Organization
  • Levelized cost of energy
  • LCoE (levelized cost of energy)

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