DECOMMISSIONING AND INSTALLATION PROJECT AT LILLGRUND OFFSHORE WIND FARM

DECOMMISSIONING AND INSTALLATION PROJECT AT LILLGRUND

OFFSHORE WIND FARM

“A Project”

by

HASEEB AHMAD

Submitted to the Office of Graduate Studies of

Gotland University

in partial fulfillment of the requirements for the degree of

MASTER OF SCIENCE IN WIND POWER PROJECT MANAGEMTENT

June, 2012

Major Subject: "Energy Technology"

“Master of science in Wind Power Project Management”

2012

DECOMMISSIONING AND INSTALLATION PROJECT AT LILLGRUND

OFFSHORE WIND FARM

“A Project”

by

HASEEB AHMAD

Submitted to the Office of Graduate Studies of

Gotland University

in partial fulfillment of the requirements for the degree of

MASTER OF SCIENCE IN WIND POWER PROJECT MANAGEMENT

Examiner: Dr. Bahri Uzunoglu

June, 2012

Major Subject: "Energy Technology"

ABSTRACT

The Lillgrund Offshore Wind Farm, located in a shallow area of Öresund between Sweden and

Denmark, suffered from a series of accidents, sea collisions and extreme winds. Fourteen out of

forty eight turbines have become dysfunctional along with substation and foundations. So the

objective of this project is to decommission the foundations, old turbines and substation and

install the new foundations, turbines and substation. The same turbine and substation technology

is used for reinstallation. In the first part of this report, decommissioning process and costs are

presented. In the second part, installation process and related costs are presented while in the last

part, total cost estimation is done by calculating net present value. Since there is a change in the

configuration, the substation which was located offshore in the original project is placed onshore

now. The comparison between both configurations is done by calculating net present value for

both. There is no difference in the estimated productions of wind turbines because these are

placed at their original spots. However, electrical losses are calculated because there is a change

of cable lengths. Microsoft Excel and WindPRO are used for calculations in this project while

Microsoft Project is used to make a project plan.

NOMENCLATURE

MW Megawatt

EAR Erection All Risk

CPM Copenhagen Malmö Port

VDR Vessel Day Rate

SDR Spread Day Rate

TDC Total Daily Cost

OSV Offshore Support Vessel

EIA Environmental Impact Assessment

EHA Environmental Hazard Assessment

MVA Mega Volt Ampere

GBP Great Britain Pound

USD United States Dollar

MWh Megawatt hours

NPV Net Present Value

Contents

LIST OF FIGURES …………………………………………………………………………....…i

LIST OF TABLES ……………………………………………………………………………….ii

Chapter 1 Introduction ........................................................................................................ 1

Chapter 2 Decommissioning Process .............................................................................. 2

Turbine Removal ........................................................................................................................ 3

Foundation and Transition Piece Removal ................................................................................. 4

Substation Removal .................................................................................................................... 5

Cable Removal ........................................................................................................................... 6

Scour Removal ........................................................................................................................... 6

Chapter 3 Installat ion Process .......................................................................................... 7

Foundation Installation ............................................................................................................... 7

Turbine Installation .................................................................................................................... 8

Cable Installation ........................................................................................................................ 9

Substation Installation ................................................................................................................ 9

Scour Protection ....................................................................................................................... 10

Chapter 4 Cost Estimations ............................................................................................. 10

Capital Cost Estimation ............................................................................................................ 10

Total Cost Estimation ............................................................................................................... 11

Gantt chart for Project .............................................................................................................. 12

Chapter 5 Comparison between Configurations ....................................................... 13

VITA ........................................................................................................................................ 15

Bibliography ................................................................................................................................. 16

i

LIST OF TABLES

Table 1. Decommission of Turbines ............................................................................................... 5

Table 2. Decommissioning of Foundations .................................................................................... 5

Table 3. Decommissioning of Substation ....................................................................................... 6

Table 4. Decommissioning of Cables ............................................................................................. 6

Table 5. Installation of Foundations ............................................................................................... 8

Table 6. Installation of Turbines..................................................................................................... 9

Table 7. Installation of Cable ......................................................................................................... 9

Table 8. Installation of Substation ................................................................................................ 13

Table 9. Comparison between Configurations ............................................................................. 14

ii

LIST OF FIGURES

Figure 1. Shaded Area and Substation needs to be reinstalled ....................................................... 2

Figure 2. Gantt chart for the Project ............................................................................................. 12

Figure 3. New Configuration ........................................................................................................ 14

1

Chapter 1 Introduction

The Lillgrund offshore wind power plant is located in a shallow area of Öresund, 7 km off the

coast of Sweden and 9 km off the coast of Denmark. The wind power plant is situated 7 km

south of the Öresund Bridge, which connects Copenhagen and Malmö. The offshore wind power

plant is comprised of 48 wind turbines, each rated at 2.3 MW, resulting in a total wind power

plant capacity of 110 MW. The wind power plant system also includes an offshore substation,

an onshore substation and a 130 kV sea and land cable for connection to shore. (Joakim

Jeppsson, Poul Erik Larsen, Åke Larrson, 2009) The offshore wind farm started its operation in

the beginning of 2008. The construction of Lillgrund took about 2 years and there is a warranty

period for the turbines of 5 years. (Olsson, February 2009)

For managing the construction risk, Vattenfall purchased an owner-controlled „All risk‟

insurance policy from Codan that covered both of the two main suppliers as well as all minor

sub-contractors. For the construction phase of Lillgrund, Vattenfall signed an EAR insurance

with additional third party liability insurance and marine insurance. The policy covered all

construction work at Lillgrund, e.g. total construction costs for wind turbines, including

foundations, cables and offshore substations. However, temporary buildings and off-site

construction areas were not included, e.g. vessels. (Olsson, February 2009) Vettenfall did not

sign any insurance policy which covers decommissioning costs. Generally decommissioning

funds are used to provide security against environmental and decommissioning liabilities. In

Netherlands requires that offshore owners/operators must pay monies into a segregated

decommissioning fund for a minimum of 10 years, starting from the first year of operation of the

project. The US Environmental Protection Agency Brownfield Superfund requires operators to

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set aside monies through annual payments into a fund in order to accrue clean-up costs.

(Offshore Renewable Energy Installation Decommissioning Study, Final Report)

Figure 1. Shaded Area and Substation needs to be reinstalled

3

Chapter 2 Decommissioning Process

The decommissioning process of an offshore wind farm takes place in well defined stages.

Several important factors such as environmental protection, safety, cost, and strategic

opportunity are kept in mind to conduct the decommissioning process. The developers work

according to the available options depending upon regulatory approval and technical feasibility.

(Department of Trade and Industry, 2006)

The decommissioning process starts with the engineering planning and project management. The

engineering personnel assess the work requirements and the project management team will

report on the options available, including the scope of work that needs to be performed and how

best to prepare the bid. The plan is developed for every stage in the project. Initially the process

of market surveying and vessel selection is started. There are 14 wind turbines at Lillgrund

offshore wind farm which have to be decommissioned along with one offshore substation.

Following are different steps to be performed for the decommissioning of the wind farm.

The port selected for decommissioning process is the Port of Malmö. Malmö is located on the

south western coast of Sweden and is the largest Swedish port in the area. The port is operated

by Copenhagen Malmö Port (CMP). The water depth is up to 13 meters alongside at normal

waters. The port is accessible all year round and 24 hrs per day with no tidal or light restrictions.

(The Port of Malmö). The weather factor is taken as 0.8, discount factor is 0.85 of installation

time and inflation factor for cable is 2.

Turbine Removal

The decommissioning process started with turbines removal. There are different methodologies

that can be implemented to decommission the turbine. Number of lifts for each case vary

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however the decommissioning process is not as delicate as commissioning so an option is

selected keeping in view the disposal of wind turbines component. In the first step hub is

removed, in the second step, nacelle is removed and finally tower is removed. There are three

lifts required for this process. This option is selected because blades, nacelle and tower have to

be disposed off to landfill and scrape separately but more importantly this option will reduce the

cost due to optimum number of lifts.

The jackup barge vessel is used along with two tugs one cargo barge and one crew boat. The

operation started with the mobilization of vessel and cargo barge to the location. The cargo barge

can lift seven turbines, so removal vessel (jackup barge) removed 7 turbines and cargo barge sent

those turbines to onshore. The removal took place in two turns. The complete cost and operation

calculation of the turbine removal is done using Microsoft Excel. However main results are

shown in table1.

Foundation and Transition Piece Removal

After turbines removal, foundations and transition pieces are removed. The normal method to

decommission the foundations is first to cut them and then lift. But in this case cutting is not

required because monopiles are 5 meter long, these are only pulled outside. The operation started

with getting inside the pile and setting up the jetting and pumping equipment. The mud present

inside the monopiles is pumped out. The turbine cables at mud line are cut by the help of divers.

The jackup barge is used as a removal vessel to lift the transition piece and foundation. Spread

containing one barge, two tugs and crew boat is used. Cargo barge performed two rounds to put

the foundations to the port while removal vessel remained on site throughout the operation. The

complete cost and operation calculation of the foundation removal is done using Microsoft

Excel. However main results are shown in table2.

5

Table 1. Decommission of Turbines

Method Selected Single Vessel Method

Vessel Jack up Barge

Spread 1 cargo barge, 2 tugs, 1 crew boat

Time to Remove a Foundation (hours) 11

Time to Remove all Foundation (hours) 154

Vessel Day Rate (VDR, $/day) 64200

Spread Day Rate (SDR, $/day) 21750

Total Daily Cost (TDC, $/day) 85950

Total Cost to Remove Foundations (million $) 0.5515125

Table 2. Decommissioning of Foundations

Substation Removal

The topside of substation removed first transformer requires no cut so it is lifted as a whole. The

next step is to remove the monopile foundation for substation. It is done in the same way as

turbine foundations and transported to the port. An OSV is used to support divers and cutting

operations and OSV along with heavy-lift vessel remained on site throughout the operation. The

Model Selected Barge model

Vessels Jackup Barge


Total removal time (hours) 1365



Total Daily Cost (TDC, $/day)

89450

Total Project Cost (Cost, million $)

5.087469

6

complete cost and operation calculation of the substation removal is done using Microsoft Excel.

However main results are shown in table3.

Total Time to Remove Substation (hours) 80

Vessels OSV, Heavy lift vessel, barge spread

Total day rate ($/day) 131000

Cost (million $) 0.436667

Table 3. Decommissioning of Substation

Cable Removal

Mostly power cables do not constitute a hazard but removal option is selected because these

might interfere with commercial trawling or other activities. Only inner array cables for 14

turbines are removed with the help of OSV and spread barge. Inner array cables come in short

segments so recovered in one piece. The complete cost and operation calculation of the cable

removal is done using Microsoft Excel. However main results are shown in table4.

Total Length of Cable (km) 5.335

Vessels OSV, barge spread

Removal rate (Km/day) 1.115385

Removal time (day) 4.783103



Table 4. Decommissioning of Cables

Scour Removal

Mechanical dredge is employed to conduct the scour removal operation. The cost to remove

scour is 12000$/foundation. So the total cost for the whole operation is 0.18 million $.

Site clearance is not required while material disposal has been contracted to a company which

will do this work without charge.

7

Chapter 3 Installation Process

The wind turbines and an offshore substation is planned to be reinstalled at Lillgrund wind farm.

The land is still under lease, so there is no such hurdle regarding lease. Generally, for setting up

new offshore wind turbines requires two main permits in Sweden. First is environmental impact

assessment (EIA) or Environmental Hazard Activity (EHA) and second is permit for hydraulic

operations. (Patrik Soderholm, MariaPettersson, 2011) The permit for hydraulic operations may

only be approved if the private and social benefits of the project exceed the corresponding costs

and damages. (Kenneth Hansen, Brian Vad Mathiesen, David Connolly , 2011) In addition to the

above, one final permit may be required (both on and outside Swedish territory), and this

concerns the installation of cables on the continental shelf. This permit is also granted by the

Government. (Patrik Soderholm, MariaPettersson, 2011)

In this case all the requisites were fulfilled before building the Lillgrund wind farm. The new

turbines are put exactly on the position of damaged ones. So no permission and legal issue arises

for reinstalling the wind turbines. Also it is planned to use the same turbine technology to reduce

any complications and increased expenses for operation and maintenance. The wind farm was

needed to be operational as soon as possible so the only change is the placement of offshore

substation. It is placed onshore however the comparison between new and old design will be

made later in the report.

Foundation Installation

The installation phase is started with the foundations. The jack up barge as an installation vessel

with spread containing cargo barge, two tugs and a crew boat is reached at the wind farm from

Malmö port. In the first trip, cargo barge contained seven foundations. The installation started

with the placement of pile into the seabed. After the monopile is secured in the seabed, a

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transition piece is lifted and grouted onto the pile. The same vessel is used for transition piece

placement and scour protection. Seven more foundations are brought to the site in second trip

and installed in the same manner. The complete cost and operation calculation of the foundation

installation is done using Microsoft Excel. However main results are shown in table5.

Method Selected Self Transport Model



Time to Install a Foundation (hours) 50

Time to Install all Foundation (hours) 750




Total Cost to Install Foundations (million $) 2.795313

Table 5. Installation of Foundations

Turbine Installation

After installing the foundations, turbines are installed. The vessel used for installation is Jack up

barge along with spread. The port used for turbines is Nyborg, Denmark due to production

facility of Siemens in Denmark. The installation method of turbines comprised of four lifts. The

tower is transported in two pieces and lifted in two lifts. The nacelle is lifted separately. The

rotor and blades are assembled onshore transported to the offshore site and lifted in one lift. The

advantage of using this method is to reduce the number of lifts and onshore off course onshore

assembling of rotor provide better and accurate fitting. The complete cost and operation

calculation of the turbines installation is done using Microsoft Excel. However main results are

shown in table6.

9

Method Selected Barge Model



Time to Install a Turbine(hours) 82.5

Time to Install all Turbines (hours) 1155




Total Cost to Install Turbines (million $) 4.304781

Table 6. Installation of Turbines

Cable Installation

Inner array cables are installed between the turbines. Since the old layout is used so the time for

pre-excavating a trench is reduced. The cable is laid with the help of cable laying vessel and

trenches are filled with the help of dredge. The cables are then connected to wind turbines

through J tubes. The complete cost and operation calculation of the cable installation is done

using Microsoft Excel. However main results are shown in table7.

Total Length of Cable (km) 5.335

Vessels OSV, barge spread

Installation rate (Km/day) 0.55

Installation time (day) 9.7



Table 7. Installation of Cable

Substation Installation

The substation mainly comprise of 120 MVA step up transformer, switch gears and other

equipment. The typical cost for 500 MW wind farm onshore substation is approximately 35

million GBP. (RWE npower renewables, August, 2011) So for 110 MW wind farm, the typical

10

cost of onshore substation would be approximately 1.3 million USD. Following is the

breakdown for substation cost. (RWE npower renewables, August, 2011)

High Voltage and Medium Voltage Equipment = 55%

Installation = 15%

Civil Engineering = 10%

Others = 20 %

The installation cost would be around 0.2 million USD. For capital cost estimation 4 million

USD will be subtracted from total capital cost

Scour Protection

The total time for the scour protection of fourteen foundations is approximately 10 days and 0.08

million dollars are spent on this.

Chapter 4 Cost Estimations

Capital Cost Estimation

A regression model, derived from previous projects, is used to calculate capital costs. The capital

cost does not include cost for decommissioning and installation costs. It includes cost for

turbines, foundations, substation and cables.

C = 0.73 + 0.0011CAP + 0.036 WD – 0.0036 DIS + 0.013 STEEL

C = Reported millions of dollar per MW

CAP = Install Capacity MW

WD = Water Depth

DIS = Distance to shore

STEEL = European Steel Index

11

Putting values

C = 0.73 + 0.0011*32 + 0.036*5 -0.0036*7 + 0.013*200

Reported millions of Dollars per MW (C) = 3.5704

Total Cost Estimation

Net positive value (NPV) calculation is performed to see if the project is profitable or not.

E = gross generated energy = 320000 MWh

CD = reported millions of dollars for decommissioning = 6.466

CT = reported millions of dollars for total capital costs CT = C*total capacity = 114.2528 - 4.0

CI = reported millions of dollars for installation = 7.622

Loss = Losses from WindPRO calculations = 3.06%

Price = price of electricity 90.00 $ / MWh

OM (operation and maintenance) = 10.00 $ / MWh

r = real interest rate 30 years fixed 4.50 %

NPV after 1year = -100.622 million $

NPV after 6 years = 3.219 million $


12

Gantt chart for Project

The Microsoft Project is employed as a planning tool for different activities within this project.

The project is divided into 11 main tasks. The main tasks have subtasks as well. The complete

process is shown below using Gantt chart.

Figure 2. Gantt chart for the Project

13

Chapter 5 Comparison between Configurations

In the original design, the substation is located offshore. If the same configuration is selected, the

offshore substation has to be placed on monopile. The transformer would be assembled onshore,

lifted off the dock by a heavy-lift vessel, and would be transported to site. After the transformer

is placed on the foundation and secured, finishing work would be performed. The complete cost

and operation calculation of the substation installation is done using Microsoft Excel. However

main results are shown in table8.

Total Time to Install Substation (day) 4.8

Vessels Heavy lift vessel, barge spread



Table 8. Installation of Substation

Now for the sake of comparison between new and old configurations, NPV is calculated to see if

the project is profitable or not. Following is the NPV using old configuration (offshore

substation)

E = gross generated energy = 320000 MWh

CD = reported millions of dollars for decommissioning = 6.466

CT = reported millions of dollars for total capital costs CT = C*total capacity = 114.2528

CI = reported millions of dollars for installation = 7.9947

Loss = Losses from WindPRO calculations = 1.84%

Price = price of electricity 90.00 $ / MWh

OM (operation and maintenance) = 10.00 $ / MWh

r = real interest rate 30 years fixed 4.50 %

14

NPV after 1year = -104.658 million $



Old Configuration New Configuration

Total Capital Cost (million $) 114.2528 110.253

Total Installation Cost

(million $)

7.9947 7.622

Losses (%) 1.84 3.06

NPV after 1year (million $) -104.658 -100.622

NPV after 6 years (million $) 0.660 3.219

NPV after 30 years (million $) 279.715 278.363

Table 9. Comparison between Configurations

Figure 3. New Configuration

15

VITA

Name: Haseeb Ahmad

Address: Gotland University

Cramérgatan 3, 621 67 Visby, Sweden

Email Address: [email protected]

Education: Bachelor‟s in Chemical Engineering. The University of Engineering and

Technology Lahore, Pakistan, 2003

Certified Professional Manager in Health, Safety and Environment, Pakistan

Institute of Modern Studies, 2011

Masters in Wind Power Project Management, Gotland University Sweden,

2012

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Bibliography Department of Trade and Industry. (2006). Decommissioning of offshore renewable energy

installations under the Energy Act of 2004. London: Department of Trade and Industry.

Joakim Jeppsson, Poul Erik Larsen, Åke Larrson. (2009). Technical Description Lillgrund Wind

Power Plant. Sweden: The Swedish Energy Agency.

Kenneth Hansen, Brian Vad Mathiesen, David Connolly . (2011). Framework conditions and

public regulation for wind turbines in the Øresund Region. Sweden: EnergiØresund.

(Final Report). Offshore Renewable Energy Installation Decommissioning Study. UK: Department

of Energy and Climate Change UK.

Olsson, A. (February 2009). Analysis of ‘All risk’ insurance from an offshore wind farm

perspective. Sweden: The Swedish Energy Agency.

Patrik Soderholm, MariaPettersson. (2011). Offshore windpowerpolicyandplanninginSweden.

Energy Policy 39 , 518-525.

RWE npower renewables. (August, 2011). Onshore Substation Opportunities. An RWE Innology

Company.

The Port of Malmö. (n.d.). Retrieved March 20, 2012, from Maersk Broker Agency:

http://www.maerskbrokeragency.com/OFFICES/SWEDEN/MALM%C3%96.aspx

DECOMMISSIONING AND INSTALLATION PROJECT AT LILLGRUND OFFSHORE WIND FARM

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