What does wind energy have to do with electric cars? Is building grids really cheaper than having batteries? Why is offshore wind energy about to have a renaissance? And why will the dream of relying on renewable energy remain a dream for the next 30 years? In light of the recent COP26 summit, we asked Dr. Andreas Schroeter, former Executive Vice President and Managing Director at DNV GL, to share some insights about the future of renewable energy in our latest podcast episode
Dr. Andreas Schroeter is a former executive vice president at DNV GL, the world's largest classification society and provider of services to the maritime, oil and gas, and renewables sector. Schroeter is the managing director of DNV GL's advisory business in Central, Eastern, and Mediterranean Europe and Latin America. With a background in engineering, Schroeter has more than 25 years of experience in telecoms, offshore projects, and renewables.
Full Transcription:
Marina Guimarães:
Our podcast today discusses renewable energy and wind force. To talk about it, we invited Mr. Andreas Schroeter. Mr. Schroeter is the former executive vice president of DNV GL, and is working now as a private consultant. He is skilled in renewable energy and business development. Mr. Schroeter, thank you so much for being here.
Dr. Andreas Schroeter:
Thank you for having me.
Marina Guimarães:
So, we are now just past COP26. We heard promises coming from world leaders. Therefore, we would like to talk to you about renewable energy sources, more specifically, wind energy. So, when we talk about wind power, what challenges are companies that sell or are engaged with wind energy are facing right now?
Dr. Andreas Schroeter:
Well, there are a couple of challenges. I mean, on the one hand side we see a lot of demand towards renewable energy and wind energy, so a lot of gross potential. And at the same time, we also see that some of the players are having financial difficulties. So, the challenge is basically to grow the organization, to develop new turbines, but also to be profitable at the same time.
Marina Guimarães:
And if you could say, let's say, three goals for wind energy in the next, I don't know, 5-10 years, which goals would you say and which obstacles are you facing that are not necessarily related to the cost?
Dr. Andreas Schroeter:
Well, there are a couple of developments in wind energy, and one has to distinguish between the place where those wind turbines are being installed. So we have onshore wind, for basically land-based installations. Then we have offshore wind, that is basically bottom fixed installation, meaning the wind turbines, in the end, are fixed to the CBAT, and then we have an upcoming market of floating offshore wind. So even though they all have wind turbines, the challenges for all those three are quite different. So one of the big challenges for floating wind and also for offshore wind is to find the right size of the turbines.
Dr. Andreas Schroeter:
So we have seen bigger turbines coming and, of course, a bigger turbine brings more energy, a higher energy yield. At the same time, of course, it involves a lot of development costs, new materials, new physics. And so the right balance to find. I would say, this is one of the biggest challenges for wind turbine manufacturers. On the onshore wind side, apart from the cost element, of course, we see that in some parts of the world, we see a lot of opposition against wind. Wind turbines, they have a visual impact that cannot be neglected.
Dr. Andreas Schroeter:
And so, those developers have to deal with the general public, have to deal with politicians, and in the end, find a common way forward. Because if you want to decarbonize, the only way to get to decarbonize societies, and we have seen in the current COP event a lot of promises. In my view, some of the countries promised to be carbon neutral too late. So in order to get there, one big element is developing further wind turbines. And this involves also online wind installations, not just offshore wind installations. And the last element, I would say, this was the third challenge, is to make sure that the use of renewable energy is keeping at the same pace.
Dr. Andreas Schroeter:
So, meaning, the best thing would be for society. And also for the effectiveness of renewable energy, and wind in particular, is that, at the time we develop new wind parks, we have also the users basically next door. And there are too many use cases, but let's say two big use cases that are currently discussed. One is to use electric cars. So to use electricity wind turbines directly to power electric cars. And the second one that is hyping right now, I would say, is green hydrogen. Because hydrogen is seen as a perfect energy source with a high energy density and to be carbon-free.
Dr. Andreas Schroeter:
And the idea is of course then to generate this hydrogen from electricity coming from wind or solar and not from natural gas as it is coming right now. So, the challenge is that we keep up the pace on the production of green hydrogen while we construct more wind parks, and at the same time, that the growth of electric cars goes at the same pace while we build more wind turbines.
Dr. Andreas Schroeter:
Maybe one last challenge I forgot to mention is a grid, because there's a saying that building grids is much cheaper than having batteries. But building a new grid is quite difficult.
And it's much easier to deploy a battery with a limited certainty capacity. But building the right grids and interconnecting countries to make sure that we also have wind energy available, let's say, in the North Sea, if you speak about Europe and then deploy this available electricity to other parts of Europe, for instance, in the cold winter season, we don't have sun, we don't have any wind, so that locally those countries cannot produce their own electricity. So the way to transport the energy is wire grids. And this is something where we are lacking right now and which is maybe also one of the big challenges.
Marina Guimarães:
Yeah. My next question was going to be exactly about that. If there's no wind, how cheap is it to transport the energy?
Dr. Andreas Schroeter:
Well, the cost depends on the availability of the grids. And of course also depends on the market price. The idea is to have, in Northern Europe or in Europe, the so-called copper plate, where basically the entire continent is connected to each other, but we are far from this state. So it may be cheaper and it will be cheaper for the transition period to have, if no renewable resources are available, if the batteries are depleted, to use still technologies like gas, fire, power plants that can easily be ramped up and also ramped down. Having said this, it's important to mention that the dream of having everything, whether we produce in electricity or energy and overall, but in particular electricity just coming from wind or renewables resources like wind solar and hydro, this is just a dream.
Dr. Andreas Schroeter:
This is something that will be a dream that cannot be fulfilled within the next 30 years. We will need other sources of energy in this transition period. So if we have cold winter months, let's say, end of November, typically here in Northern Europe, where I'm living, then we may need gas fire power plants if we don't have any renewable sources available. On the other hand, it's important to mention that there may be no wind on land and there may be no sun in the cold winter months in the Northern hemisphere. However, usually, there is wind offshore. So that's the reason why offshore wind will see... renaissance, one might say. Here in Germany, where I'm living, we just had general elections and it's expected that we will ramp up our targets towards installations of offshore wind.
Dr. Andreas Schroeter:
Because offshore wind can serve as a so-called baseload. Because there's always some wind in the sea, and if it's not in the North Sea, then you can use the Baltic sea. So offshore wind will be a possibility to cover those dark non-windy months in maybe January, February, but we will not be able to do this without gas and with other produce forms of electricity production. And we have seen, of course, also countries like France promoting renaissance of nuclear. This might be an option for some countries, for other countries it will not be an option. So if you don't want to have nuclear, and if the wind installations are not there yet, if the grids are not there yet then we will need other forms. And natural gas is a good way to get there.
Marina Guimarães:
And another criticism that wind energy faces is the wildlife: are they threatened? You have wildlife that lives where the installation takes place. Is there a way to avoid the threatening of wildlife?
Dr. Andreas Schroeter:
Well, it cannot be neglected that there is an impact. This is true. On the other hand, just to give you one anecdotal example, here, where I'm living, we have no sea eagles here in the Northern part of Germany because of all the pesty seeds that we used in agriculture over the last 30 or 40 years. Now we have maybe 50 or 60 couples of sea eagles. And yes, maybe sometimes a sea eagle or another bird will be impacted by a wind turbine. But wind turbines can be planned in a proper way that certain species are not so much affected. Secondly, I've seen a study and it's quite public domain, that more birds are killed by cars and actually more birds are killed by cats. So if you want to probate wind turbines, you should then also probate that people are having cats. So yes, there is an impact, but I would say it's a price that we have to pay and it's an impact that we can manage.
Marina Guimarães:
Okay. And now looking at the future, how can we increase use? Is there a specific strategy that comes to your mind? Is it doable? Can a country rely 100% on wind energy or only on renewable energy sources?
Dr. Andreas Schroeter:
Well, I would say 100% we will be there at one point in time. But I think the most important thing is not to try to switch and to threaten and to let the society switch off everything that is not renewable right now, but rather to do it as fast as possible and to use as little as needed resources from fossil fuel. Yes, by the end of the century, maybe in some countries by the mid of century, we will be entirely free of any electricity production from coal and gas. And in many countries also nuclear, but it's about the way, how fast we get there. So there are projects, for instance, DNV publishing energy transition outlook in August and September that we will have like 70% to 80%, depending on the country of electricity produced from renewable resources.
Dr. Andreas Schroeter:
I think that's a big step. We are far below 50. Some countries are around 20. Some countries are just around 10% or even less. So the idea is not to be, let's say, go from zero to one, but rather the pathway towards renewable and an understanding that we have an exponential growth of renewables that will gradually just push out other sources out of the mark. Like for instance, electric cars that very much go in line with the installations of renewables. Right now electric cars are still the minority along the roads. But we will see a drastic shift over the next 10 to 20 years. Many countries have announced, and even manufacturers have announced to stop manufacturing combustion engine cars and just go entirely electric. And this of course will propel the demand for further renewables.
Dr. Andreas Schroeter:
So, my view, it is not about, let's say, going from zero to one, meaning from almost no renewables to a lot of renewables, to 100% renewables, but to go there as fast as we can. And at the same time also be realistic and also mindful of the cost to use sources like gas if needed to cover up in times or areas where it's not possible to get the electricity from renewables there. And maybe it's not just about electricity production, we have to look at the entire, the CO2 and also myths and impact that society has. So the electricity sector is just one. We have others like transport, we have agriculture, we have buildings. So if you want to achieve the targets that are discussed right now in the current COP summit in Glasgow, we have to look at the entire system, the entire primary energy resources that come from, first, the fields.
Dr. Andreas Schroeter:
So it doesn't help to be 100% renewable in the electricity sector, and still not being efficient when building or when the agriculture sector. So everything has to be looked at. And of course, renewables can help also in the other sectors like producing green hydrogen, as I mentioned. Solar is also a good form to produce green hydrogen that can then be used in other sectors. So, I think it's important to mention that we have to look at all sectors. Because in the end, the CO2 or the other gases admitted to atmosphere, they really don't mind where they come from.
Marina Guimarães:
So, you mentioned Glasgow. Last question, which governments right now are more likely to invest in this clean source of energy? And do you see a possibility of change after COP? Should we be hopeful?
Dr. Andreas Schroeter:
Well, I don't have the exact list of the commitments of all countries at hand. I would say it is good that big countries, important countries like the United States committed themselves. I've heard that maybe some countries like China and India didn't bring all those commitments that they were asked to do, but I'm very positive. And I tell you why. The investment into renewables and into, let's say, carbon-free future is not just about, let's say, for the survival of mankind. Actually, it's a good business case. Installing renewables right now, in particular, wind right now is much cheaper in most cases than even running existing gas or coal fire power plants. So for the economic rationale of installing renewables, this will improve every basically day, every year. So we are having like 10%, 50% growth in event installations year over year, hence the cost will go down.
Dr. Andreas Schroeter:
New technologies will come. We will have entire ecosystems that will develop, and this will then propel further investments. And also politicians to understand that it's just good business. And if it's good business and helping the, let's say, environment, I think that's the best-case scenario for us as a society and for our planet. I'm very confident with the case. And we see it, we see it. I mean, countries like maybe from a political side against renewables, heavily investing in those technologies, in particular, wind, because they just see it's a good business case. So just see apart from the political world, is the desire to do something good for the next generations, wind, solar, in particular, will just convince more and more investors, politicians, because of the economic rationale. So I'm rather optimistic about the next development. And I think we will reach those targets much earlier than maybe promised right now by some politicians in Glasgow.
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