Wind Parks as “Wind in Our Sails”

Wind Parks as a Fusion of Ecological Imperative and Technological Achievements

Wind energy represents an increasingly significant segment of the global energy market, currently covering about 3% of the world’s electricity consumption. In addition to being an environmentally responsible technology, harnessing wind offers significant economic benefits. In the face of unprecedented climate challenges and escalating concerns about energy security, the wind energy sector emerges as a key player in the global energy transition. In recent years, we have witnessed exceptional growth in this sector, with Europe emerging as a significant driver alongside other leading regions in this sphere.

Climate Uncertainty as a Catalyst

Due to sudden temperature spikes and growing climate uncertainties, Europe, along with the US and Asia, has experienced record heatwaves, intensifying the urgency of the need for sustainable energy solutions. Recognizing the role of wind in achieving climate goals, governments worldwide have spurred investments to strengthen energy security and initiate decarbonization efforts. China, in the field of wind-generated energy, is far ahead of the competition with an additional capacity of 23.8 gigawatts in the first half of 2023. India, Brazil, and the United States also record significant increases, each with over 2 gigawatts of added capacity. In Europe, Germany and France lead the growth, with each country adding more than 1 gigawatt of capacity.

Instalisana snaga vetroelektrana
Wind industry statistics and growth - World Wind Energy Association (WWEA) Report

One of the key reasons for the global expansion of wind energy usage is its competitive price. Electricity generated by wind often represents the cheapest option. According to reports, the costs of producing a kilowatt-hour of electricity in new onshore wind farms range from 5 to 9 cents, making this price attractive and wind increasingly favored as an energy source. While at first glance, kilowatt-hour prices in new fossil fuel power plants may seem competitive (around 7 cents), the actual production costs are significantly higher. It is well known that emissions from fossil fuel power plants have a significant negative impact on human health, resulting in high costs for the healthcare system. Studies by the European Union and the German Ministry for the Environment estimate that the actual costs of electricity production from coal are double the nominal price. Similarly, this applies to other fossil energy sources, the total cost of which far exceeds the costs of wind energy production.

Wide Range of Applications and Market Potential of Wind Energy

Technological advancements in the field of wind energy have enabled the design of various types of wind turbines tailored to specific locations and needs. Wind parks with turbines on land (“onshore”) and offshore wind farms, located at sea, differ. Additionally, in regions with lower wind speeds, modern wind turbines have larger blades for optimal energy utilization, while in areas with higher wind speeds, taller towers are used to harness the full potential of the available wind resource.

Floating Wind Turbines - Offshore Wind Farms

Large offshore wind parks represent a significant source of clean energy. Although they offer high potential, their construction and maintenance are challenging and expensive. The cost of electricity from these farms, taking into account all lifecycle costs, is approximately twice as high as onshore wind turbines. However, the technological synergy between offshore wind turbines and carbon capture and storage (CCS) systems can become a significant tool in the fight against climate change.

Studies indicate that integrating CCS technology with offshore wind farms could have a dual positive effect:

  • Reduction of CO2 Emissions: By capturing CO2 emitted during energy production in offshore parks and storing it underground, this technology would contribute to a significant net reduction of carbon dioxide in the atmosphere.
  • Cost Optimization: Utilizing excess energy from offshore parks to power CO2 capture facilities could significantly reduce the operating costs of CCS systems.

This synergy presents a promising concept for improving the sustainability and economic efficiency of offshore wind energy, contributing to a faster transition to clean energy and a reduction in the global carbon footprint.

Small Wind Turbines - Local Solutions and Market Perspective

The trend of developing small wind turbines for private homes, smaller communities, and industrial facilities represents a significant market segment. To date, around half a million such systems have been installed, mainly in China and the United States. Although their electricity production cost is relatively high, for many consumers in underdeveloped or isolated areas, it represents the only way to obtain electrical power. In developed countries, this option is becoming increasingly attractive as its cost can still be more competitive than the prices of commercial electricity suppliers. Experts predict significant long-term growth in the small wind turbine market.

The World Wind Energy Association (WWEA) has released a report highlighting significant growth for the 2023 period. According to this report, the data is as follows:

  • During the first half of 2023, 38% more new capacity was installed compared to the same period in 2022.
  • From June 2022 to June 2023, 100 gigawatts were added, bringing the total wind power capacity to 976 gigawatts.
  • The annual growth rate is 11.4%.
  • By the end of 2023, at least another 110 gigawatts of new capacity is expected to be installed.
  • The expected total capacity by the end of 2023 is 1 million megawatts.
Global Installed Capacity of Wind Parks 2010-2023

Development of the Wind Power Sector in Serbia

The commercial development of the wind power plant sector in Serbia began over the last five years, although initial studies and site investigations had been conducted earlier. Favorable regulatory and financial frameworks in 2015 and 2016 enabled significant sector growth. The construction of large wind farms like Čibuk 1, Kovačica, Alibunar, and Košava, realized with the support of international financial institutions and commercial banks, provided a significant incentive for further investment. Research shows that Serbia has considerable wind potential beyond the built capacity. Besides South Banat, promising areas for wind park development include Eastern Serbia, Zlatibor, and the Pešter Plateau. So far, 8 wind farms with a total installed capacity of 398 MW have been connected to Serbia's power grid. In parallel with the operating production capacities, the design and development of wind parks with a total planned capacity of 4.2 GW are underway.

Wind energy utilization stands out as a rapidly growing and profitable source of electricity. In addition to being a sustainable alternative to fossil fuels, its low cost makes it an increasingly attractive option in global energy strategies.

As long-time insurance brokers, we at EuroSolutions recognize the growing importance of environmental protection and the need for renewable energy sources like wind. In this regard, we pay special attention to the development of wind farm insurance, as wind farms are technologically complex structures that require a specialized approach to insurance and additional considerations.