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The green energy revolution is gathering speed. Under existing policies and market conditions, global renewable capacity is forecast to reach 7,300 gigawatts by 2028. And increasingly, the distance that green energy needs to travel is getting longer. In the quest for higher wind yields, turbines are being pushed ever deeper out to sea, while countries want to be able to buy electricity from those with sunnier or windier weather. This can smooth out surges and lulls in locally generated power and be cheaper.
One example, the potential Xlinks project which by 2030 aims to bring green electricity from Morocco to Devon. A distance of 3,800 kilometres. The cable carrying that energy will account for nearly half of the venture's £20bn budget. The most efficient cables, which are high voltage direct current or HVDC, lose about 3 per cent of their energy per 1,000 kilometres. Proponents argue that long distance projects such as Xlinks can be cost effective. Xlinks has said it is seeking a contract from the UK government for 25 years, guaranteeing a price of £56 to £64 per megawatt hour in 2012 prices.
That's lower than the maximum price the government has said it is prepared to pay offshore wind developers in the next auction round of £73 per megawatt hour in 2012 prices. Demand for high voltage cables for offshore wind projects is expected to significantly increase over the next 10 years. With the appetite for cross-border interconnector cables also growing, the consultancy 4C Offshore estimates current plans will result in a shortage of high voltage DC cables outside of China by the second half of this decade. China has domestic manufacturers, which mostly supply the Chinese market, but in the rest of the world there is a paucity of suppliers. Three companies account for more than 75 per cent of the market.
Moves are being made to alleviate the supply problems. For example, several cable plant projects are planned in the UK. But boosting supply won't be quick, easy or cheap. Cable manufacturing facilities require high capital costs, unconventional industrial buildings and deep water access to load their cables on the cable laying ships, as well as a well trained staff. Renewable energy capacity may be rising, but actually getting plugged into grids could prove a greater challenge than generating the power itself.