Offshore wind installations beat pre-pandemic forecast; pipeline swells
The Global Wind Energy Council's forecast for offshore wind installations in 2020 increased 5% compared with its pre-pandemic forecasts to 6.5GW, led by an installation rush in China.
The offshore wind sector has been largely shielded from the impacts of the COVID-19 crisis, the trade association said in early November, with the 6.5GW forecast the latest record year for the industry.
Through 2024, at least 48 GW of new offshore wind capacity is expected to be installed, with another 157 GW forecast to be installed by 2030, according to GWEC.
Following China's September pledge to be carbon-neutral by 2060, to have a chance at achieving this goal, the world's largest wind power market needs to be installing 50 GW of wind power a year through 2025, and 60 GW a year from 2026 onwards, said Feng Zhao, strategy director at GWEC.
The total pipeline of global offshore wind projects has risen 47% since January, RenewableUK said in late October.
The trade group's latest Offshore Wind Project Intelligence report shows total offshore wind project capacity globally that is operational, under construction, consented, in planning or in development equals 197.4GW, up from 134.7GW in mid-January. Of that pipeline, some 50.5% is in Europe at 99.6GW, according to its survey.
"The global appetite to develop new offshore wind projects remains enormous, despite the pandemic this year, as this research proves. The UK and many other countries are counting on the rapid growth of the offshore wind sector to be a key driver in the worldwide green economic recovery," RenewableUK Deputy Chief Executive Melanie Onn said.
UK tops pipeline table
The UK remained top of the table with a total pipeline of 41.3GW, up 12% since January, when its total was 36.9GW, the UK-based trade group said.
But China roared up the rankings into second spot from fourth with an 80% increase to 26.1GW from 14.5GW, according to the survey.
The US retained its position on the bottom step of the podium, with 10% growth to 17.8GW from 16.2GW.
However, Brazil is close behind, emerging from "nowhere" in the words of RenewableUK to grab fourth place with 16.3GW. The 10 offshore wind projects on tap in Brazil have all been announced since the start of the year.
Taiwan held onto a ranking of five with a 65% increase to 15.2GW from 9.2GW, but Germany crashed from second to sixth place due to a 29% decrease in its pipeline from 16.5GW in January to 11.7GW in October.
The top 10 was rounded out by three European nations rising up the rankings and an Asian country doing the same.
The Netherlands is in seventh position with a 58% increase to 11.4GW from 7.2GW, according to RenewableUK, while Ireland's pipeline expanded by 44% to 9.1GW from 6.3GW for eighth spot and Poland took ninth with 72% growth this year to 9.1GW from 5.3GW.
Vietnam was outside the top 10 at the start of the year but filled the last spot in the table with 8.6GW, "reflecting the growing importance of the offshore wind market in East Asia," the trade association said.
While the US is on pipeline podium, it remains a laggard in terms of operational capacity, with just the 30-MW Block Island project online.
That figure is dwarfed by those of the leading countries when it comes to turbines turning. The UK is a long way out front at 10.4GW while Germany is in second place with 7.7GW and China is third with 4.6GW, according to the RenewableUK survey. Rounding out the top five are Belgium at 1.8GW and Denmark with 1.7GW.
Every home in the country: Johnson
And there's more on the way in the ladder leader. At the start of October, UK Prime Minister Boris Johnson promised the country's offshore wind fleet would be producing "more than enough electricity to power every home in the country by 2030."
Johnson upped his nation's offshore wind fleet target to 40GW from 30GW and set a target for floating wind capacity for the first time. He wants the UK to have 1GW of floating offshore wind capacity online by 2030, a figure put in perspective by the former London mayor admitting this was 15 times greater than the current total across the globe.
"Our seas hold immense potential to power our homes and communities with low-cost green energy and we are already leading the way in harnessing its strengths," Johnson said 6 October.
"Now, as we build back better we must build back greener. So we are committing to new ambitious targets and investment into wind power to accelerate our progress towards net-zero emissions by 2050," he added.
How much of that will be sourced locally is up for discussion, but Johnson is promising £160 million ($215 million) for upgrades to ports and infrastructure and a sector that supports as many as 60,000 jobs directly and indirectly.
That is not the case in China, where the wind market is dominated by local developers and equipment suppliers, including the likes of Goldwind, Envision, Ming Yang and Shanghai Electric.
And the scale of individual companies' operations is sizable too. The top four onshore wind owners are Chinese, according to IHS Markit data, with state-owned China Energy Investment Corporation (China Energy) top of that list. China Energy is the fifth largest global player individually in the offshore wind sector, according to the data.
China's potential attracts overseas interest
It isn't just domestic players who are involved in this growth though.
France's EDF is working with China Energy on a 500-MW offshore wind project costing more than $1 billion. Construction began in October, according to state news service Xinhua. EDF Group invested more than $160 million for a 37.5% stake in the Dongtai project.
State-owned China Three Gorges held talks with EDF's fellow French energy giant Total on offshore wind, including floating turbines, according to local media, and it launched the construction of two offshore wind projects involving 2.2GW of capacity in late February and expects to start operations by 2021.
The ambitions of the developer of the world's largest hydro-electric project and a player in that sphere around the globe, including in Brazil, span multiple renewable energy sectors.
In August, a European subsidiary agreed to buy about 500 MW of solar photovoltaic facilities in Spain from Madrid-based projects developer X-Elio Energy, the seller said, with local media slapping a Eur500 million ($606.9 million) price tag on the deal. X-Elio is owned by Brookfield Renewable Partners and private equity behemoth KKR.
China Three Gorges already had investments in Portugal, Germany, the UK and Greece, X-Elio said. That Portuguese involvement includes its stake in EDP, which it tried unsuccessfully to take over in 2019. Its German interests include offshore wind farm operator WindMW.
At the end of October, Japan and South Korea joined their neighbor across the Yellow Sea and East China Sea in announcing ambitions to reach net-zero emissions.
Japan is expected to publish a revised energy plan in June 2021. Meantime, installation of the country's first utility-scale offshore wind farm - a 139-MW MHI Vestas project - is expected to begin in 2022.
South Korea, meanwhile, has brought in Norway's Equinor for an 800-MW joint venture with Korea National Oil Corp. (KNOC). Other JVs on the ramp involve domestic companies and EDP Renewables, Aker Solutions, Total and Macquarie Group's Green Investment Group — the last of which involves 2.3GW of capacity.
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