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Corporate

Sustainable energy trends put wind in Prysmian’s sails

EVP PROJECTS BU HAKAN OZMEN SEES STRONG COMPETITIVE ADVANTAGE IN WIND FARMS, SUBMARINE TELECOMS


An irreversible trend towards renewable energy will continue to fuel growth Prysmian Group’s submarine cables business in the coming years, as offshore wind technology becomes more reliable and spreads to new geographic regions, says Hakan OzmenPrysmian Group EVP Projects Business Unit.

The world is changing,”

he says.

“There is a huge trend towards renewable energy as it becomes increasingly efficient. This is good for the planet. I feel the fact that our core business in submarine power cables is built around renewable energy is an additional motivation for us.

The Viking Link contract announced by Prysmian July 23 is a good example of these trends and of Prysmian’s competitive advantage. The €700 million submarine contract calls for cabling a distance of 1,250 km, the longest ever, and will help bring sustainable energy to 1.4 million households in the UK and Denmark. 

Wind energy was Europe’s second largest form of power generation capacity in the EU28 in 2018, and is likely to overtake natural gas installations this year, according to figures from WindEurope, an industry group. In 2018, wind energy generated enough to meet 14% of the EU’s electricity demand. Denmark had the highest share of wind generated energy in Europe (41%), followed by Ireland (28%) and Portugal (24%). Germany was the leader in installations.

 
Onshore wind investments hit a record level of €16.4 billion in 2018, and offshore spending continued its strong growth trend reaching €10.3 billion, according to WindEurope, as price drops and technology improvements have spurred growth.
Prysmian is playing a leading role in the development of offshore wind farms in Europe, with projects like, MerkurHelwin1 & Helwin2BorWin2BorWin3Horns Rev 3 and Wikinger as well as the recently awarded DolWin5, several offshore wind farms in France, Hornsea Two, and Borssele III and IV. The Projects Business Unit specializes in turnkey cables solutions and had revenue of €1.8 billion in 2018, of which 55% came from submarine energy cables and 40% from high voltage cables.

Offshore wind capacity is expected to almost triple to nearly 52 GW in 2023, with half the growth driven by the European Union and the other half by China and other Asian countries,

said the International Energy Agency in its Renewables 2018 report.

Offshore wind farms are particularly suited towards conditions in Northern Europe, where the world’s largest, Hornsea One, came on stream earlier this year. Prysmian is a supplier to Hornsea Two, which will be up and running supplying 1.3 million families in 2022, located 89 kilometers off the Yorkshire coast in the UK.

Both water depth of wind farms and distance to shore have increased over the years and are expected to further increase in the future, according to industry groups. This trend works in Prysmian’s favor, since distances of over 100 kilometers from shore is an area where the group has expertise with DC systems thanks to its long-distance interconnection experience, says Ozmen.

The United States will become potentially a very large market for offshore wind, says Ozmen, as investors and utilities discover its advantages. Prysmian has been recently awarded a contract worth approximately €200 million by Vineyard Wind Vineyard for a submarine power cable system which will deliver clean energy to the mainland power grid in the US.

The move to floating windfarms will be the next big step for the industry, says Ozmen, as the costs fall and the technology improves. Prysmian, which already holds a considerable market share and targets 30% in the near future, is well placed to reap benefits from future growth in this area because it makes dynamic cables that can resist the wear and tear of a floating turbine. These cables are already installed at Kincardine Offshore Floating Wind Park, and will be used by EDF for Provence Grand Large, a floating offshore windfarm project off the coast of France in 2021.

Offshore floating is going to be the next-generation energy source. It can be installed very far from the shore independently of depth, which will be also, from the aesthetic point of view, more and more preferred once the technology has been matured.

he predicts.

Another growth area for Prysmian in this sector will be submarine telecommunications cables, which accounted for just 1% of the Project BU’s revenue in 2018. Thanks to the acquisition of General Cable, Prysmian Group has returned to this sector with turnkey solutions for optical fibre submarine telecom cables that will be produced at the Norddeutsche Seekabelwerke GmbH (NSW), installed by its vessel fleet and managed by its project management team. The Projects BU has created a new business unit called Telecom Submarine to deliver growth in this business.

Telecoms providers have traditionally driven this market. Now most of the tech giants included in GAFA have invested in building their own submarine cable capacity, and this trend is likely to continue. Industry reports estimate double digit growth rates over the next four to five years in this segment. More online content and faster internet speeds have led to increasing demand higher bandwidth and therefore for submarine communications cables.

Prysmian Group’s Projects BU’s market offering will get a huge boost from its new cable installation vessel to be inaugurated in the second half of 2021, says Ozmen. The new vessel will be the most technologically sophisticated in the market, and will enable Prysmian to offer clients new advantages of cost savings and time savings. With 2 rotating platforms of 7,000 and 10,000 tons, the new vessel can ensure the highest carousel capacity in the market, enabling a reduced transportation time from the factory to the site, thus improving overall project efficiency.

Moreover, the new vessel will install Prysmian’s lighter armoured cables, enabling it to lay cables at a depth of 3,000 meters. These cables are made at the Group’s Arco Felice plant and are being installed for the first time in the Cyclades Islands in Greece.

The combination will be the best revolution in the market,

says Ozmen.

You cannot beat it.