Europe celebrated an encouraging milestone by adding 2.1 GW of new offshore wind capacity in the first half of 2023, contributing to a total offshore wind capacity of 32 GW. The Netherlands led the charge, with substantial contributions from the UK, Germany, and Norway.

To reach the set objectives, the EU is targeting an average annual offshore wind installation of 11 GW until 2030. There is a clear understanding that greater strides will be made in the latter half of this decade.

In other words, North Sea wind power is huge, and set to accelerate. Globally, clean energy investment is extending its lead over fossil fuels, with the IEA reporting that for every dollar invested in fossil fuels, around 1.7 dollars are going into clean energy. The potential is enormous, with the IEA reporting that “the next generation of floating turbines capable of operating further from the shore could generate enough energy to meet the world's total electricity demand 11 times over in 2040”.

Nine European nations committed earlier in 2023 to vastly expanding offshore wind farm capacities in the North Sea. Their goal is to increase the combined capacity from the current level to 120GW by 2030 and an ambitious 300GW by 2050. This plan, announced at a summit in Ostend, Belgium, involves building more wind farms, creating "energy islands" at sea, and investing in carbon capture initiatives.

The investment needed for this expansion is substantial, estimated at around €800 billion to achieve the 300GW target by 2050. Challenges related to the supply chain for turbine parts currently limit the annual offshore wind capacity growth to 7GW, despite the ambition to develop 20GW of output each year, according to WindEurope.

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Big investments require substantial insurance cover

This trend is great news for energy insurers and brokers (both marine and land-based) who are looking to move into offshore renewables insurance.

With capabilities on both land and sea, Noria is well-positioned to help insurers and brokers ride this exciting green wave. The wind power domain has long belonged to land-based insurers, but offshore wind farms require insurance system capabilities with objects from both the land and marine insurance worlds. We are helping insurers who want to enter this market – or land-based insurers, who want to follow wind farms out to sea – do so in the correct way.

We are also seeing some new needs and challenges emerging. Before an offshore wind farm begins generating electricity, numerous elements—both tangible and logistical—must align: transporting massive towers and blades using specialised vessels, embedding foundations into the seabed or establishing floating platforms, erecting onshore and offshore power substations, and laying enormously expensive and failure-prone cables between the turbine and the shore. Additionally, there are environmental considerations such as climate impacts and lightning strikes which pose common risks to wind turbines. Insurers are looking for the capture of new types of data and new methods of analysis.

Noria systems are prepared

Noria has decades of experience in “old energy” in the form of offshore oil platforms and installations, along with experience in renewable energy through hydroelectric plants. We have some of the first on and offshore windfarms in our system.

With large energy suppliers on land and energy brokers offshore using our PARIS system, Noria is well-positioned to support the critical need of financially securing the coming wave of large investments in renewables.

Change on this scale presents a huge opportunity for insurers and brokers. Noria is prepared to assist you, on both land and sea. Contact us to learn more.