LS Cable's technologies meet global demand for offshore wind power

Employees of LS Cable and System check on HVDC submarine cables coiled and stored outside the company's No. 4 plant in Donghae, Gangwon Province. Courtesy of LS Cable and System

Demand for submarine cables high in Europe, North America, Southeast Asia

LS Cable and System's head of Energy Business Division Kim Hyeong-won / Courtesy of LS Cable and System

By Ko Dong-hwan

DONGHAE, Gangwon Province ― The growing importance of renewable energies is making offshore wind farms more popular worlwide. Subsequently, LS Cable and System's competition with global rivals is getting fiercer, according to Korea's leading submarine cable manufacturer, Sunday.

LS, with three other submarine cable manufacturers in France and Germany, take up more than 85 percent of global orders for submarine cable, making and burying it inside the seabed using a specialized vessel.

The firms are battling over rising markets in North America and Europe where the need for offshore wind farms are spiking as renewable energy's role in national power output is being expanded. To connect the "farms" and terrestrial power consumers, submarine cables must be laid to deliver power.

Having absorbed LS Marine Solution ― an LS Group subsidiary ― last August, LS Cable says it has been self-developing technologies since it completed its first manufacturing plant in Donghae, Gangwon Province in 2009.

The company now has four manufacturing plants with its most recent (including an over 170 meter-high VCV tower) completed in May. Nearby at Donghae Port, the company's GL2030, a vessel that can transport hundreds of kilometers of factory-made cable, is docked and ready projects anywhere in the world. One of three maritime cable-laying vessels owned by Marine Solution, the GL2030 is Korea's only vessel with a dynamic positioning system that can work beneath the seabed.

Demand for high voltage, direct current (HVDC) submarine cables have already surpassed their supply volume globally, according to LS Cable. Later this year, the Korean firm plans to launch a new cable manufacturing-installation project for Taiwan, which will be about 2.5 trillion won ($1.85 billion) in size. LS Marine Solution has set up a local office in Taipei to search for local partners to manufacture parts for its cables.

Employees of LS Cable and System work on manufacuring a HDVC submarine cable at the company's factory in Donghae, Gangwon. Courtesy of LS Cable and System

Earlier this month, LS Cable formed a partnership with PTSC, a subsidiary of Vietnam's state-run energy company Petrovietnam, to jointly search for project opportunities in Southeast Asian waters. The partnership also aims to hitch LS Cable to a new project by the Vietnamese government that will erect a 6 gigawatt offshore wind farm by 2030, a capacity high enough to be recognized as among Asia's top five by then.

The Korean firm has already begun building a 532 megawatt-capacity offshore plant in waters off Yeonggwang County, South Jeolla Province. The project, due for completion in 2027, is currently the largest offshore plant in Korea.

The Korean firm's latest strategic moves in Asia are aimed at the region's growing submarine cable market, which is expected to jump from $1.57 billion this year to $2.42 billion by 2027, according to LS Cable.

"Countries across the world are now desperate to build offshore wind farms," Kim Hyeong-won, LS Cable and System's head of Energy Business Division, said in Donghae, Thursday. "And our company is confident right now because we have rising global requests for partnerships for submarine cable projects. They trust our expertise. We also have more than enough invested capital to execute future projects."

In Europe, LS Cable chose to focus on the U.K. market that will lay submarine cables to connect its wind farms to the European mainland.

The company is also monitoring Europe as the region will likely draw its power, which is generated in wind farms in Africa, via submarine cables invested in by Middle Eastern countries, according to Kim.

One of the biggest hurdles for LS Cable's international expansion is building local factories overseas. Without the factories, it has to manufacture products in Korea and ship them over long distances. That increases a product's price by some 20 percent, a critical disadvantage.

"Because we already have the technological upper hand, we will have better global competitiveness once we have manufacturing facilities in key target areas overseas," said Kim.