In most European countries with offshore wind farms, the respective transmission system operators (TSOs) are responsible for connecting these offshore facilities to the onshore grid, which they also operate. The TSCNET shareholders affected by this arrangement include the north-eastern German TSO 50Hertz, the Danish TSO Energinet and the Dutch-German TSO TenneT. But obviously this handling is not the only one possible. In the UK, for instance, the developer of the particular offshore wind farm is also responsible for its grid connection.
In concrete terms, this means that in the UK the offshore grid connection after its completion is sold to commercial investors and a so-called OFTO (Offshore Transport Owner) is established. But which model, the TSO model or the OFTO model, causes the lowest costs for consumers and thus for society?
The internationally accredited registrar and the world’s largest classification society, DNV GL, has investigated this question in more detail. The main outcomes of this study are that in the OFTO system the costs for the development of offshore connections are significantly higher than in Denmark and the Netherlands. In contrast, the Levelised Cost of Energy (LCOE) of the Dutch and Danish offshore connections is significantly lower. The LCOE assesses the average total cost of constructing and operating an energy generating asset over its lifetime divided by its total energy output over that lifetime.