Aluminium giant signs world's longest wind contract; UK targets 2 GW offshore installs per year

Our pick of the latest wind power news you need to know.

Aluminium group Norsk Hydro signs 29-year wind contract

Norwegian aluminium company Norsk Hydro has signed a 29-year wind purchase contract with a subsidiary of Macquarie Group for a new 235 MW onshore wind farm in Sweden.

The contract is believed to be the world’s longest corporate wind power purchase agreement (PPA), Norsk Hydro said in a statement July 19. The deal comes a year after Macquarie and Norsk Hydro partnered on the 650 MW Markbygden Ett onshore wind farm, Europe's largest onshore wind project.

The new contract was signed between Norsk Hydro subsidiary Hydro Energi and Macquarie subsidiary Green Investment Group (GIG) and supports the construction of a new wind farm near Sundsvall and Ostersund in Sweden.

The contract secures baseload supply of 0.3 TWh per year for the period 2021 to 2031 and 0.55 TWh/year for the period from 2031 to 2050. In total, the wind farm is expected to generate around 0.8 TWh/year.

Siemens Gamesa will supply the turbines and provide operations and maintenance (O&M) services through a 25-year agreement.

Norsk Hydro has now secured 4.5 TWh/year of wind power from 2021 onwards, supplementing contracted hydro power supplies and captive power generation.

Norsk Hydro has purchased 100% of its Norwegian primary aluminium power needs from renewable sources. Around 70% of its global primary aluminium production power needs is sourced from renewable energy plants.

Healthcare companies sign PPA for Denmark's largest offshore wind farm

Global healthcare company Novo Nordisk and biological solutions group Novozymes have signed a long-term power purchase agreement (PPA) with Vattenfall for its 600 MW Kriegers Flak offshore wind project in Denmark, Vattenfall said in a statement July 13.

The Kriegers Flak project was awarded in late 2016 at a record-low offshore wind price of 49.9 euros/MWh. The plant will be Denmark's largest offshore wind farm and is scheduled to be fully operational by the end of 2021.

The PPA with Novo Nordisk and Novozymes will cover approximately one fifth of Kriegers Flak's total output.

The PPA enters into force from January 1, 2020. Before the start-up of Kriegers Flak, the power will be sourced from other Vattenfall wind farms in Denmark.

"We are experiencing an increasing demand from businesses to buy 100% renewable energy. This agreement is a result of that," Branislav Slavic, Vice President of Business Sales Nordic at Vattenfall, said.

UK to tender up to 2 GW offshore wind capacity per year

The UK is to hold offshore wind tenders every two years from May 2019 in a bid to install up to 2 GW of new capacity per year, the UK government announced July 23.

The government confirmed it would provide 557 million pounds ($731.1 million) of support in the next tender through contracts for difference (CfDs) and the amount of capacity allocated will depend on the price achieved.

For the first time, onshore wind farm projects on remote islands will be able to bid into the auction. These projects have particular characteristics which entitle them to subsidies, including higher transmission costs, potential for larger projects and higher load factors than mainland wind projects, the government noted.

UK onshore wind projects have been excluded from CfD auctions, effectively exposing new projects to market prices. In 2016, the government also accelerated the expiry of renewable obligation certificates (ROCs) for onshore wind capacity. New onshore wind installations surged in 2017 ahead of ROC expiry deadlines, but this is not seen as a long-term trend unless there is a major policy shift.

Around Europe, offshore wind tenders have increased competition between developers and accelerated price reductions.

In the last UK tender held in 2017, the government awarded Dong Energy and EDP Renewables (EDPR) 15-year contracts for difference (CfDs) for two new UK offshore wind projects at prices of 57.50 pounds/MWh.

The CfDs were half the price of contracts awarded in the previous UK offshore wind tender in February 2015, highlighting how growing economies of scale, installation experience, and technology advancements are driving down costs.

    Europe offshore turbine market shares (cumulative, end of 2017)

                                                        (Click image to enlarge)

Source: WindEurope

Russian hackers penetrate US power control rooms through suppliers

Russian hackers gained access to the control rooms of U.S. electric utilities by first penetrating the networks of suppliers who had trusted relationships with the power companies, the Wall Street Journal reported July 23, citing officials at the Department of Homeland Security (DHS).

The hackers got to the point where they could have "thrown switches” and disrupted power flows, Jonathan Homer, chief of industrial-control-system analysis at DHS, reportedly said. The cyber attackers claimed “hundreds of victims” last year, according to DHS officials.

The comments show federal officials are looking to increase the awareness of cyber security threats.

Since March 2016, Russian government hackers have targeted multiple U.S. government and critical infrastructure facilities including nuclear power systems, the U.S. Department of Homeland Security (DHS) and Federal Bureau of Investigation (FBI) said in March. The coordinated attack was carried out by a group known as Dragonfly.

According to Homer, the hackers exploited special relationships between utilities and vendors with special access to update software and run equipment diagnostics.

The attackers used conventional techniques such as spearfishing emails and watering hole attacks to compromise the networks of suppliers. This allowed them to gain access to utility networks, Homer said, consolidating information provided by the DHS and FBI in March.

DHS is currently investigating whether the hackers are automating their attacks, which could lead to larger-scale operations.

The DHS' National Cybersecurity & Communications Integration Center (NCCIC) will conduct a series of webinars between July 23 and August 1, to discuss recent cyber activity against critical infrastructure and mitigation techniques.

US Interior wind boom has driven down costs: EIA

U.S. average wind installation costs fell from $2,360/kW in 2010 to $1,587 in 2016 as technology, manufacturing and installation processes improved and more projects were installed in the lower-cost U.S. Interior region, the U.S. Energy Information Administration said.

Projects in the U.S. Interior represented 46% of new capacity in 2010 and by 2016 this had risen to 90%, EIA said.

Developers in the Interior have benefited from more favorable wind resources, large expanses of flat developer-friendly land, and transportation access to growing regional manufacturing hubs, EIA said.

                           US wind installations, costs by region

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