THE FUTURE OF FLOATING

SOLAR:
Drivers and barriers to growth

R E P O RT
The future of floating solar: Drivers and barriers to growth

CONTENTS

Introduction __________________________________________________
03

Where is solar PV heading? ____________________________________

04

Floating PV development, drivers and barriers ___________________

06

Construction challenges of FPV systems _________________________

08

Cost development of FPV ______________________________________

10

The outlook for floating near-shore exposed and

offshore PV and its synergies with other ocean industries __________
11

References ________________________________________________ 13

The authors ________________________________________________ 13

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The future of floating solar: Drivers and barriers to growth

INTRODUCTION

In the next four years, floating photovoltaic (FPV) will likely grow significantly as the overall
global PV capacity doubles. Compared to utility-scale installations, overall installed capacity
of FPV will be small ranging between 10 and 30 GW by 2030 according to DNV estimates.
However, its emergence is noticed in the market. Although concepts are still being developed
and improved, progress in areas such as reducing evaporation from covered water,
infrastructure availability for different locations and spatial synergies with other industries such
as offshore wind or aquaculture means that floating PV, both on inland water bodies and
offshore, is gaining advantages in an expanding renewables landscape.

This report outlines DNV`s view on the current and future developments and an outlook on synergetic applications
development of FPV. It summarizes our latest forecast for of FPV with other industries such as offshore wind.
FPV installations and presents an overview of FPV`s latest The results shown here are taken from DNV`s Energy
development and expected growth over the coming years. Transition Outlook model, DNV`s Ocean Forecast to 2050
It discusses drivers and challenges, recent cost and our work on recent industry projects.

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The future of floating solar: Drivers and barriers to growth

WHERE IS SOLAR PV HEADING?

Since the 1980s, electricity demand and the global economy have grown at a similar rate of
about 3% each year. And not only has their rate of growth been similar, but the growth pattern
for electricity demand has also closely tracked economic development, driven by the high
electricity consumption of two key sectors, industry, and buildings.

In the next three decades electricity demand will more than Since the first GW of solar was installed in 2004, the industry
double to 60,000 TWh and the supply of electricity will has enjoyed significant growth. By 2020, 730 GW of solar
change dramatically (Figure 1). Today about 25% of global was installed globally and by 2050, the world will see
electricity is supplied by renewables such as hydro, wind, 12.4 TW of solar power connected to the electricity grid.
solar PV and biomass, this figure will increase to 82% by This development will be dominated by Greater China which
2050. The highest share from this 82% will come from solar will have a share of 30% of global solar PV installations,
PV, both with and without storage options due to solar PV followed by the Indian Subcontinent with about 20%.
having the lowest levelized costs by mid-century. Significant growth is also forecast in all other regions except
North East Eurasia.

Figure 1 - World electricity generation by power station type and associated levelized cost of energy from solar PV [1]

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The future of floating solar: Drivers and barriers to growth

This development is enabled by solar PV`s cost Currently, the levelized cost of solar PV with dedicated
development. Capital expenditure (capex) dominates the storage is more than double that of solar PV without storage
costs for solar PV and a further reduction from just below due to high battery prices. However, as illustrated on the
USD 0.9/Watt-peak (Wp) per unit on average will be right side of Figure 1, as battery prices fall in the coming
essential for solar PV`s further expansion. We forecast a decade, levelized costs of solar PV and solar PV plus
significant drop to USD 0.6/Wp by 2050 owing to a storage become narrower. In return, solar PV plus storage
remaining high panel cost-learning rate of 17% in 2050, has advantages regarding the achievable capture price.
down from 26% today. Another factor driving the reduction Further analysis on why lower received prices will not be a
of levelized costs of solar PV is through increasing showstopper for solar PV (plus storage) can be found in our
performance ratio via a higher share of single-axis trackers latest Energy Transition Outlook.
and bifacial solar cells.

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The future of floating solar: Drivers and barriers to growth

FLOATING PV DEVELOPMENT, DRIVERS

AND BARRIERS

A small but growing share of the global capacity comes from a dedicated type of solar PV
installation – those floating on water bodies. Compared to the traditional (rooftop and
ground-mounted) PV market and to other renewable energy applications, FPV is a relatively
young niche, which only started to gain traction in the past decade.

The first recorded FPV projects were built in 2006-2007, with capacity of FPV from less than 100 MW in 2015 to pass the
small pilot installations, mainly for research purposes or for threshold of 1 GW in 2018 [2]. Since then, the interest in FPV
self-consumption in California, Spain, Italy and Japan. The and the number and size of FPV projects has grown globally,
size of these projects ranged from 10 to 100 kWp. Despite with an estimated global installed capacity in April 2022 of
these early installations, the FPV market only started to take more than 3 GWp, less than 1% of the total PV capacity. The
off between 2012 and 2015, mainly thanks to the entrance in Asia-Pacific region still retains the record for highest installed
the market of dedicated FPV structure manufacturers. After capacity, with more than 2.7 GWp installed, with China in the
2015, a sharp increase in the number and average size of lead, followed by the European continent with more than
FPV projects was recorded, especially due to the Top Runner 250 MWp, of which more than 200MWp is in the
incentive scheme in China, which pushed the global installed Netherlands (Figure 2).

> 2700 MW
> 250 MW
> 10 MW

< 10 MW

< 5 MW

< 5 MW

Figure 2 - Global distribution of floating PV systems (DNV/own assessment)

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The future of floating solar: Drivers and barriers to growth

The figures above are largely based on installations on

inland water bodies. Although FPV near-shore and offshore
pilot projects are being undertaken, there is limited installed
capacity.

To understand the impressive growth trends of this

industry, we can identify a number of key drivers, which can
vary among different countries and regions. In the context
of the energy transition and the needed global push for
renewables, any alternative way of installing renewable
projects is being considered. FPV is an optimal solution for
accessing additional space for solar installations, using water
surfaces without having to compete with other usages (e.g.
agriculture, settlements) as often occurs for ground-mounted
PV. On the contrary, FPV can often be combined with other
productive uses of water bodies, such as water treatment,
irrigation, hydropower generation and storage [3]. This has
been the main driver for installation of FPV, especially in
areas of the world which are densely populated and with
limited available space, such as South-East Asian countries
and, European countries such as the Netherlands. Figure 3 - Historic growth and growth forecast based on DNV owned
calculations and studies [5-7, own study]
In addition, installation of FPV systems on water bodies can
have the beneficial effect of reducing water evaporation
rates, helping to save water, especially in areas with drought To enable the growth which is expected to take place in the
issues and water scarcity [4]. As an example, the FPV market FPV market, and to realize what is shown in Figure 3 as the
in Israel has been developing quickly in recent years, “high scenario”, several challenges need to be overcome.
especially in small/medium size reservoirs, with the double The challenges which have been encountered so far in the
intent of increasing renewable energy production while FPV domain, and still not fully solved, are of a commercial,
saving water. It is important to mention that, despite technical and regulatory nature. They might be the reason
numerous early claims in the industry about the beneficial FPV stays small compared to utility-scale PV capacity. Even
cooling effect of water on the PV modules, the energy yield the capacity reached in the presented “High Scenario” in
increase that can be achieved in FPV installations is limited 2030 is less than 1% of utility-scale PV by that time.
and rarely offsets the still higher costs when compared to However, FPV presents a viable option, e.g., for cases
ground-mounted PV. where synergetic uses such as water body coverage are
advantageous or space for utility scale installations is scarce.

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The future of floating solar: Drivers and barriers to growth

CONSTRUCTION CHALLENGES OF
FPV SYSTEMS

The most crucial issues when it comes to the design of a FPV project are related to
those elements which are considered as “unusual” for the traditional solar industry:
the station-keeping system (anchors and mooring lines) and the floating structure.

The mooring system, in particular, has been identified as Concerning the floating structure itself (often referred to
one of the main cause of failures up to now in the FPV as “floats”), the main technological concerns relate to its
industry. This is due to inherent complexity of a station- durability when exposed to environmental loads and fatigue
keeping system for FPV and to the application of “old” for the intended lifetime of the structure. Despite the fact
technological solutions, which are relatively known and with that the majority of the materials used in FPV are already
a long track record, to a “new” and different application. widely used in other industry segments, the performance
Compared to other types of floating and/or offshore and reliability in this new application is still to be proven.
structures (floating wind turbines, oil and gas platforms, Environmental stresses and loads, such as UV degradation,
ships, marinas), floating structures used for FPV typically corrosion of materials, extreme loads, and cyclic loads due
have lower load capacity at their connection point between to wind and waves, can lead to issues and failures in the
the floating structure and mooring line, meaning they need a medium/long term. A lack of clear testing procedures and
higher number of lines (and anchors), with more distributed testing requirements for floating structures leads to
loads. This increases the complexity of assessing the load complexities in the quality assurance processes, posing
and response of the structure, both from a design and a a further threat to the acceptance and bankability of this
numerical modelling perspective. In return, FPV installations technology. With the growth of the FPV industry, different
will experience much lower wind loads than large turbines or and innovative technology concepts for FPV structures are
oil and gas platforms. An even higher degree of complexity being developed, with different layouts and different types
is added considering the high number of interlinked of materials. Defining uniform and clear ways of testing
components which make up the floating structure itself (e.g. new layouts and new materials for long-term reliability and
HDPE pontoons, metallic rafts, walkways, etc.). The industry is quality will be a key enabler for the safe deployment of FPV
learning quickly from operational projects and encountered projects in the future.
issues, in order to optimize the anchoring and mooring
design, with the double intent of reducing costs and
increasing reliability of the design. The matter becomes
even more relevant when looking at sites with a complex
bathymetry or with consistent water level variations, for
example in hydro-dam applications. A crucial step in this
direction is to define analysis methodologies and design
standards which are specific for FPV structures and not a
direct transfer of an offshore-based design approach, which
are in most cases not fully applicable to FPV applications.

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The future of floating solar: Drivers and barriers to growth

Figure 4 - Typical layout and components of an FPV system

In addition to the structural challenges mentioned above, The challenges mentioned above, although referring mainly
there are other aspects of FPV safety and reliability which to the inland water bodies application of FPV, are also valid
should not be overlooked, such as the electrical design. for the near-shore and offshore segment of FPV and are even
Electrical safety is a crucial aspect in every PV project, and it more pronounced, considering the higher costs and harsher
is normally covered by a set of international standards (IEC, environmental conditions expected in offshore locations.
UL, etc.), while for FPV projects there is still a lack of specific In addition, salt water installations will be more exposed
electrical standards to be used for the design and selection to corrosion. Nonetheless, while the inland FPV industry is
of components. It is then crucial to perform an accurate risk adding more and more GWs to the pipeline, the offshore
assessment and to carefully design the electrical system for FPV industry is still in an earlier stage of development, going
an FPV project, especially concerning water ingress, risk of through research projects, pilot installations and
immersion of components (cables, connectors, etc.), cable development of new technological concept which will be fit
management and earthing. A poor cable management for purpose for offshore installations.
system and a poorly designed electrical layout can easily
lead to electrical failures, short circuits and potentially fire.

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The future of floating solar: Drivers and barriers to growth

COST DEVELOPMENT OF FPV

The LCOE of floating solar is dominated by capex with the operating costs being approximately
20% of the levelized costs. The main driver for continued growth of FPV is that unit investment
costs, which is approximately 1.2 USD/Wp, will fall significantly with every doubling of FPV
installations globally, potentially reaching 0.65 USD /Wp in 2050. Currently the global average
LCOE for FPV is 65 USD/MWh and it has been observed as low as 45 USD/MWh in highly cost
competitive markets in Asia.

The largest components of capex in floating solar is the PV

module and structural components such as the floats and
mooring and anchoring. The capex of FPV will be
dependent on the development of PV module costs, which
has a cost-learning rate of 27% which will decline to 17% in
2050 [1]. The overall cost-learning rate for FPV is estimated
to be between 10% - 17% from 2022 to 2035 and 4% - 6%
from 2035 to 2050, depending on the scenario of installed
capacity shown in Figure 3.

Depending on the cumulative installed MW capacity

presented in Figure 3 and the cost-learning rate, the LCOE
can decline to 34 USD/MWh in 2035 and potentially to
30 USD/MWh in 2050. It is expected that the LCOE for FPV
will in general remain higher than ground mounted solar PV,
but in some cases such as areas with high population
density, where land is scarce and where land costs are higher
than the costs of the water body, FPV may have lower LCOE.

The key component for cost reduction of FPV is increased

installed capacity for FPV. The industry is in development
and there is room to improve system design and design
methodologies. There is a need for standardization in the
FPV industry, especially for floating testing and for design
methodology of mooring and anchoring. Manufacturers,
project developers, investors, lenders and insurers will
benefit from having recognized international standards
where there is a clear methodology to ensure safe and
reliable operations of FPV for the lifetime of the projects
[8]. With increased confidence in FPV, more projects will be
developed, and the costs will be reduced.

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The future of floating solar: Drivers and barriers to growth

THE OUTLOOK FOR FLOATING NEAR-SHORE

EXPOSED AND OFFSHORE PV AND ITS
SYNERGIES WITH OTHER OCEAN INDUSTRIES

The potential emergence of floating near-shore and offshore PV may come at a time signified
by a “race for space” in our oceans [9]. Marine space demand will grow 9-fold as a result of the
scaling of offshore wind and aquaculture, before even considering offshore floating solar PV.

DNV forecasts that ocean industries will occupy more than

350 000 km2 by 2050 (Figure 5), which is almost the area of
Norway. FPV was not considered in that analysis as most
capacity additions are planned for inland waterbodies, and
the area requirements for offshore FPV is believed to be
minor in comparison to offshore wind.

There will likely be large areas available between the wind

turbines where other infrastructure can be placed, for
instance floating solar PV structures. With offshore wind
development comes also developments in offshore grid
and storage infrastructure, which can be developed with
sufficient excess capacity to also support later additions of
solar power. This calls for a field development process in
the offshore wind industry that also accounts for the need
for flexibility. Such integrated energy systems may provide a
significant upside in terms of operational expenditure (opex)
due to synergies in infrastructure, labour and vessels for
inspection and maintenance operations. Hence, the overall
LCOE of the system will decrease. Figure 5 - Marine space requirements forecasted by the
Ocean’s Future to 2050 report

Reducing cost is the key success factor for making near-

shore exposed and offshore floating PV commercially viable.
Due to the loads from waves requiring reinforcement, the
structures will inevitably be more expensive per Wp than
in-land applications. As the offshore technology is currently
at R&D stage with only small pilots installed to date it is
expected that we will see significant cost reductions as
projects scale. Factors such as financial support mechanisms,
improved design requirements and risk reduction premium
as experience increases will also contribute to reducing
costs.

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The future of floating solar: Drivers and barriers to growth

The most pronounced opportunities for near-shore exposed and offshore FPV include:

• Make use of abundant solar energy resources in less space-conflicted areas.

• Maximize use of acreage, increase overall energy production and reduce LCoE of projects by integrating floating solar
PV with e.g. offshore wind.
• Possibility to combine with maritime industry to provide offshore charging for electric vessels or production of
alternative fuels.
• Opportunities for decarbonization of energy supply, moving from diesel to solar. Relevant for smaller island and
industries such as fish farming.
• Opportunity for energy project developers to diversify their portfolio and to leverage competence acquired from
other offshore industries.

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The future of floating solar: Drivers and barriers to growth

REFERENCES

[1] DNV (2021) Energy Transition Outlook 2021 – A global and regional forecast to 2050
[2] T. Reindl & C. Paton (2020) Where Sun Meet Water: Global Market Status, Project Database and Economics.
Keynote presented at the Solarplaza 2020 Floating Solar Conference, Online, November 3rd 2020
[3] N. Lee et al. (2020) Hybrid floating solar photovoltaics-hydropower systems: Benefits and global assessment of
technical potential, Renewable Energy
[4] McKuin et al. (2021) Energy and water co-benefits from covering canals with solar panels, Nature Sustainability,
available at: https://escholarship.org/uc/item/8cj5j07p
[5] World Bank Group, ESMAP and SERIS (2019) Where Sun Meets Water: Floating Solar Handbook for Practitioners,
Washington DC: World Bank
[6] SERIS (2020) Floating Solar Conference Amsterdam, 2020
[7] Wood Mackenzie (2021) Floating solar landscape 2021
[8] DNV-RP-0584 (2021) Design, development and operation of floating solar photovoltaic systems, Oct 2021
[9] DNV (2021) Ocean’s Future to 2050 – A sectoral and regional forecast of the Blue Economy

THE AUTHORS

Thomas Horschig - Lead author

thomas. [email protected]

Harald Hammer - Senior consultant, solar

[email protected]

Tore Hordvik - Principal consultant floating wind & solar

[email protected]

Sigurd Pettersen - Senior researcher, ocean space

[email protected]

Michele Tagliapietra - Solar consultant, global practice lead floating solar

[email protected]

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