PEAKWINDANDBCGUnlockingValueThroughOperationsandMaintenanceSevenLeverstoBoostOffshoreWindProfitabilityJuly2024MalteHippeMattiScheuRobertHjorthLarsConradsenThisarticleunderscoresthepivotalroleofoperationsandmaintenance(O&M)inenhancingtheoperationalperformanceandprofitabilityofoffshorewindfarms.Asthesefarmstransitionfromsupplementarygreenenergysourcestoprimaryenergyproviders,theemphasisonefficientO&Mpracticeshasbecomemorecriticalthanever.Despitethetraditionalfocusonexpansionandtimelyprojectdelivery,thisarticlehighlightstheuntappedpotentialinoptimizingexistingoperationalfleetsforgreatervaluecreation.Theevolutionofturbinetechnology,coupledwithagrowingemphasisonrevenueovermereproduction,necessitatesashifttowardmorerobustpredictiveandrevenue-focusedO&Mstrategies.Thisshiftiscrucialnotonlyforreducingoperationalexpendituresandenhancingassetavailabilitybutalsoforadaptingtomarketvolatilitiesandachievingsustainablelong-termassetmanagement.Byredefiningoperationalpracticesandleveragingtechnologicaladvancements,offshorewindfarmoperatorscanboostprofitability,optimizeenergyproduction,andsupporttheburgeoningroleofwindenergyinglobalenergysystems.UNLOCKINGVALUETHROUGHOPERATIONSANDMAINTENANCE1Theoffshorewindindustryiscurrentlyexperiencingaperfectstormthatisimpactingmarginsacrossthefullassetlifecycle,causingexecutivestofocustheirattentionevenmoreontheirpipelineandlessontheirever-growingoperationalfleet.However,oneshouldnotdisregardtheconsiderablevaluecreationpotentialintheOperationsandMaintenance(O&M)phase.Operationalperformanceofoffshorewindfarmsrepresentsanincreas-ingproportionofthenetpresentvalueofsuchprojects,makingefficientmanagementcriticaltoprojectsuccess.Moreover,inmanycountries,offshorewindischangingfromasupplementarygreenenergysourceintoaprimarysourceofenergy.Withthatnewlycentralrole,theneedforrobustO&Mpracticesdeliveringreliableandaffordableenergyisgreaterthanever.WehaveidentifiedfourreasonsforfocusingonO&Mim-provementinordertoboostoffshorewindprofitability:1.OffshorewindCAPEXhasdeclinedmorerapidlythanOPEXandprojectsnowhavesignificantlylongerlifespanexpectationsthanpreviously.Thismeansthatoperation-alperformanceconstitutesanever-largerproportionofthenetpresentvalueofsuchprojects.2.Historically,offshorewinddevelopershaveprioritizedex-pandingtheirpipelinesanddeliveringprojectsontime,relegatingoperationalefficiencytoasecondaryconcern.However,ascompetitivepressurecontinuestoincrease,developersneedtolookatthesignificantuntappedval-ueremainingintheoperationalfleetsofeventhelargestandmostexperienceddevelopers.3.ManyoftheO&Mpracticesstillfollowedtodaywereintroducedmanyyearsagowherewindturbinesandprojectsweresignificantlysmallerandlifespanexpectationswereshorter.Additionally,digitizationandtheuseofgenerativeAIhavenotyetreachedtheirfullvaluepotential.4.Asoffshorewinddevelopmentincreasinglyshiftstoaseller’smarket,coupledwithanincreasingtalentshort-ageinthatmarket,developinghighlycompetitiveO&Msolutions—eitherin-houseorstrategicallysourced—isemergingasanadvantage.Thisnotonlyenablesownerstodelivercompellingbusinesscasesandsecureattrac-tivereturnsbutalsofacilitatesaccesstocriticaltechnicaldatafromoperationalsites.Asaresult,today’soffshorewinddeveloperscannotaffordtooverlooktheimportanceofrefiningtheirO&Mpractices.Indoingso,theystandtounlocksignificantvalue,enhanceprojectviability,andcapital...