Asian Pacific countries have been warned not to “overdo” local offshore wind content rules if they want more European investment.
Adam Thomsen, head of market and business development at developer Skyborn Renewables, told the second day of the Seanergy conference in Paris that, although understandable, such rules add to the challenges European firms face when entering the Asia Pacific region.
According to recent reports Taiwan requires 60% local content with Japan aiming for 70% local content.
“We listen to our stakeholders who want to develop local jobs and services, but our message is don’t overdo it,” he said.
“There are 200,000 different components in a wind turbine. If you have to localise that production, you can get into trouble. Asian Pacific countries should be more realistic.”
He said that over time, given the increasing size of offshore wind assets like foundations, that localisation will happen naturally.
“Our foundations at our Yunlin offshore wind farm in Taiwan are 1,800 tonnes. That is difficult to transport around the world, so the economics will determine the creation of regional hubs. But that will come over time,” he said.
Thomsen said the company had learned a number of lessons from Yunlin.
“We struggled with issues such as soil conditions and pile runs,” he said.
“All of the financing, politics and supply chain issues were all new. If you go into Asia Pacific with just a European mindset you are in for a rough ride.”
However, he sees great potential in the region, mainly Japan, South Korea and Taiwan, given that it needs green energy not just for transition purposes but as “raw power” to drive growth.
“They are all advanced economies with consumers who want green products,” he said. “The sun is rising in the East for offshore wind.
Patrick Charignon, Vice President Asia Pacific at EDF Power Solutions, agreed with Thomsen’s list of Asia Pacific countries, adding Australia and the Philippines as areas of interest for EDF and European developers.
“Yes, local content is the elephant in the room and European developers have to establish local factories and teams on the ground. But European firms can bring three decades of experience to Asia Pacific. They know how to develop projects and supply chains, talk to fishermen and get consent. They can bring innovation,” he said.
“All of this can be brought and still meet local requirements.”