Insight

“Winds of change at PA: New head of practice offers fresh perspective on energy transition” – an interview with Aris Karcanias

Offshore wind is regarded as a game changer in the energy system as a way to deliver clean bulk power generation. We sat down with Aris Karcanias, PA’s new Global Head of Energy and Utilities, to discuss how offshore wind power has a huge role to play in transitioning our global energy system into a more sustainable one.

You’ve had incredible experience across the energy sector in your career, what made you choose to join PA now?

Fundamentally, the problems we face in the energy market today and in the future are multidisciplinary in nature and require deep expertise and a systems way of thinking. My passion is breaking new ground and I was seeking a new challenge and to expand the type of problems that I solve for clients.

It was important to me to find a business that applies both a technical and innovative lens to solving the most challenging problems our societies face. Consulting can often be theoretical in nature, with solutions ultimately falling down in the implementation phase. PA offers a rare blend of deep industry expertise combined with strategy, technology, innovation and, importantly, knowledge of regulation and other real-world implementation considerations. This allows us to deliver end-to-end customer-facing solutions that ensure problems are not simply solved in theory but also can be executed by our clients in practice.

What project would you say characterises you and how you strive to build a positive human future?

I’ve worked on offshore wind projects from very early on in my career. I started as an analyst looking at technology roadmaps that would deliver a cost of energy 20 years out, at the regulation that would enable the industry to grow and mature, and at the cost to deliver an effective scaled solution. I’ve always been convinced that offshore wind power would provide an important contribution to solving our bulk energy needs, especially given the challenges of getting the power by land to the load centres.

The accumulation of these factors was when I represented the Dogger Bank Consortium (Equinor and SSE) to bid for the world’s largest offshore wind project for the Contract for Difference Allocation Round 3 before I joined PA. It has been an ongoing debate how quickly the cost of energy for these multi-billion euro projects in complex operating environments could become cost competitive to our wholesale market prices. At the time, Equinor was seeking a major milestone in its clean energy transition and SSE was continuing to redefine its position in UK waters. It was really an inflection point where the technology was evolving into the super-giant next-generation turbines with talk of 14MW units and beyond.

When you bring all that together and add the topography of the UK seabed as you’re moving further and further out to sea – there are challenges around the seabed condition, obtaining the right consents, and issues to consider around the grid. And on top of that, there’s the competition. With everyone trying to enter the offshore wind sector, it is no longer a battle between the traditional established players – it’s an open playing field. Ultimately, the consortium managed and mitigated risk better than anyone else, and they took an innovative approach to procurement and explored the boundaries of different financial structures, using their economies of scale. And there was the challenge of bid strategy in a highly contested market – we did a lot of game theory analysis and ran war games.

As a Norwegian taxpayer, should I be proud of Equinor, based on the Dogger Bank case? Is it a viable strategic option for Big Oil, or mainly greenwashing?

It is a monumental step change and a marker in the world of offshore wind power. For Equinor, it’s a proven platform for growth and essential to the transition from oil and gas to a cleaner, and more sustainable energy future. That’s the definition of long-term success for their business, especially considering the fact that the global commitment to achieving net zero has already started reshaping the traditional energy system.

Also, more than 80 per cent of the best wind sites in the world are inaccessible unless you have sophisticated advancements, such as floating wind platforms, which is an area the Nordic community, and specifically Equinor, has been trying to pioneer. The Hywind demo projects, for example, have started to pave the way for what a commercial floating solution can manifest in our deep waters.

Offshore wind has a huge role to play in transitioning our global energy system into a sustainable one – I’d say it’s as important to our future as coal was to the industrial revolution. But that means there needs to be more work to scale floating solutions. I think it’s fair to say that the supply chain is still evolving, and the technology is still relatively nascent, but some of the solutions around floaters aren’t new and have huge potential.

The challenge for these existing technologies is how to commercially scale, with modular structures that are industrially manufactured and delivered. You need to move the cost trajectory downwards by making offshore wind power easily deliverable, from manufacturing through installation to servicing. This is a big challenge that requires ingenious solutions, and it’s what we’re trying to solve here.

So, who will lead the way going forward?

The jury is still out. Today, the oil and gas giants are doing a lot of the leading work because of their experience with floating platforms. But then you’ve got companies like EDPR, a global developer now tied in a joint venture with ENGIEin offshore, that was one of the first to invest in floating offshore wind power with Principal Power. They have five projects across Spain, Portugal, France and Japan, either in operation or being built. However, you have a host of high-quality companies building their own solutions in this market, from BW Ideol to Stiesdal Technologies – the pioneer in wind both on and offshore with its heritage deep in industrial engineering as the heart of the Tetra Foundation concept.

In the offshore wind industry, there’s a smaller number of original equipment manufacturers (OEMs) compared to the onshore industry. While these OEMs dominate, in the form of Siemens Gamesa, Vestas, and GE, the balance of the plant, service and installation portion of the market is more open. The installations to date have been dominated by Siemens Gamesa, and Vestas, however, GE has made significant strides in the last four years to bring next-generation turbine solutions to market, which have been dominating many of the large offshore wind power tenders in recent years.

The key thing we need to take away is that no one party has the perfect solution. But there’s a lot of experience and capability that comes from the oil and gas world that can help solve the challenges facing offshore wind power today. For this industry to realise its potential and to become one of the cornerstones of green global energy transition, we need to continue to bring together our learnings from a multitude of sectors.

How will the offshore wind power industry capitalise on digital to advance operational and maintenance processes?

The offshore wind power industry generates one of the most complex and advanced data feeds in the market. If you look at the data coming through the Supervisory Control and Data Acquisition (SCADA) system today, there’s information from the blades to the hub, and then right through the drivetrain, including data such as the vibration, temperatures, pressures, and sound at the gearboxes. This means you’re able to forecast the wind direction, adjust production management and anticipate maintenance demands. You can picture your misalignment corrections and model controlled system imbalances. All this lets you add to the yield of the turbine significantly in offshore, and getting these operation and maintenance (O&M) schedules correct, and keeping the uptime high involves sophisticated technology, planning, and data-driven solutions.

How are the Nordic industrial players performing in the global offshore wind market?

I would say they’re doing so well that it is getting noticed by the taxpayers in the world’s largest offshore wind market, the UK. It is clear there is a sense of frustration, given the market scale and dominance, that the Government has become frustrated as he capability, manufacturing, and thus jobs to service the industry are being outsourced from the UK, the world’s largest offshore wind power market (over 10 gigawatts of operating assets). Much of the technical know-how and delivery of infrastructure is coming from abroad – mainly from the Nordics, but also from Germany, the Netherlands, China and Korea.

The Nordic players are finding solutions to the biggest challenges around capturing value in this market and paving the way for building and scaling the industry, and showing how long-term investment will lead to positive long-term results. The Nordic markets, and Germany, bet on offshore wind power early, and created a whole industry around the space. Now they’re reaping the benefits of that from a job creation and technology IP perspective around the world.

Where do consultants fit into this vibrant and thriving industry?

I think we’ve reached a point where generalists can’t solve the complexity and scale of the challenge. The day of just doing blue sky strategy consulting is gone. There is a need to combine very deep, insightful technical expertise with strategy, market design and operational experience. That’s the sweet spot we own and that will support the next phase of growth for PA in the energy transition.

Aris Karcanias

Previously a Senior Managing Director and Co-lead of the Global Clean Energy Practice at FTI Consulting, as well as a founding member of the data science business, Aris has extensive experience working with some of the world’s leading energy companies, including Vestas, ABB and Equinor. His work has involved developing transition strategies for his clients to support portfolio decarbonisation and to enable them to capture the growing opportunities in the clean energy market. Aris is currently a member of the Investment Committee at SUSI Partners, a Zurich-based clean energy transition infrastructure fund, and a member of the Board of NextWind, a newly established green independent power producer (IPP) focused on mid to end-of-life assets.

Explore more

Contact the team

We look forward to hearing from you.