(Bloomberg) -- A wind turbine floating off the coast in northern Portugal began transmitting electricity to the grid, a crucial step for a technology that could vastly increase the potential for offshore wind power.

The WindFloat Atlantic project is backed by European energy companies EDP Renovaveis SA, Engie SA and Repsol SA and uses the floating platform developed by Principle Power Inc. Three turbines with a combined 25 megawatt capacity will eventually be connected, helping to advance the economic viability of floating wind farms in the increasingly competitive market for renewable energy.

Floating turbines could have a built-in advantage to traditional offshore platforms because they can be placed more readily. The machines can operate in waters much deeper than the relatively shallow seabeds required to anchor stationary masts. The turbines in Portugal float 100 meters (328 feet) above the seafloor, some two-thirds deeper than the maximum depth of fixed offshore farms.

A number of companies including Norway’s Equinor ASA and Royal Dutch Shell Plc have invested in floating wind. Places such as France, South Korea and Japan that have both ambitions to grow low-carbon power supply and limited areas with shallow seabed have the potential to be big markets for the technology.

The 8.4 megawatt MHI Vestas turbine used in Portugal is the biggest by a floating project and close to the size preferred by the offshore wind industry’s leading developers. Bigger machines have enabled offshore wind growth in Europe by generating more power and shortening the payback period on investments. Replicating that innovation on floating platforms could be a crucial step toward commercialization.

Engie and EDPR joined forces earlier this year to develop offshore wind farms in the U.S. and Europe, with an ambition to become one of the top two developers by 2025. Their push to develop floating wind technology could help them establish an early advantage in what could become a massive global market. Still, because of the relatively higher cost of floating technology, gigawatt-scale developments probably won’t happen for at least the next decade, according to BloombergNEF.

To contact the reporter on this story: William Mathis in London at wmathis2@bloomberg.net

To contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net, Jonathan Tirone, Nicholas Larkin

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