Global wind capacity is set to double by 2027, driven by a
rush to capture tax subsidies in the U.S., the rise of emerging markets, and a
coming surge for offshore wind.
New projections from MAKE Consulting show wind power
additions averaging 65 gigawatts a year from 2018 to 2027, equal to a compound
annual growth rate of 4 percent.
“Incentive expirations and markets adjusting to new auction
mechanisms influence a run-up to 2020, with a more than 30 percent increase in
annual capacity additions from 2017 to 2020,” according to MAKE.
Beyond 2023, increasing offshore deployment and “sustained
momentum” from emerging markets will contribute to a second period of growth of
upward of 30 percent a year, it said.
Annual installed capacity in the U.S., one of the world’s
top three wind markets in 2017, is expected to see an average threefold
decrease from 2022 to 2027 compared to the four years prior, after the federal
Production Tax Credit is phased out.
Capacity additions in India will help boost the short-term
outlook for wind energy growth, while Chinese installation levels are set to
pick up once present transmission and curtailment issues have been sorted out.
Offshore wind is also forecast to grow in China, with MAKE
predicting more than 3 gigawatts of new capacity every year from 2022 to 2027.
But once the U.S. market falls after 2022, a range of
emerging markets will jointly keep wind global installation levels rising.
In Latin America, for example, auctions scheduled this year
in Argentina, Brazil, Colombia, Mexico and Peru are expected to kick start a
10-year, 14 percent compound annual growth rate period of capacity additions.
The Middle East and Africa, meanwhile, will see annual
capacity tripling between 2018 and 2027, with 1.2 gigawatts of contracts
expected to be awarded in Saudi Arabia alone.
Some of these rising stars, though, look decidedly risky
compared to established wind markets in Europe and North America.
MAKE names Argentina, Egypt, Iran and Turkey among its
markets to watch, despite the fact that many of these countries might prove
unpalatable to risk-averse investors. Even Australia and South Africa, both
also cited by MAKE, have had policy ups and downs in recent years.
Nevertheless, said report author and MAKE Research Manager
Luke Lewandowski, “What gives us some confidence going forward is that at this
point we are seeing real projects under construction and nearing completion in
all the emerging” markets.
Over in Europe, the action is moving into offshore projects.
Across Denmark, Ireland, Sweden and the U.K., for example, offshore will take
an almost 50 percent share of all new capacity. In France, Germany and the
Netherlands, the level will be closer to 10 percent, which still corresponds to
more than 5 gigawatts of capacity for each country over the coming decade.
Overall, offshore will account for more than a quarter of
all new European capacity additions over the 10-year outlook.
In Southern Europe, onshore will still dominate. Spain and
Turkey could collectively install 13 gigawatts of onshore wind projects up
until 2027. The Southern Europe region, which includes Italy, will post a
40-gigawatt increase in capacity in the next decade.
Eastern Europe, meanwhile, will see around 1 gigawatt of
onshore capacity being added a year up until 2024. Then Poland is expected to
begin installing offshore wind, doubling the annual capacity being installed in
the region.
Andrew Canning, press and communications manager for the
European wind industry association WindEurope, said MAKE’s figures for Europe
are “in line with our calculations.”
According to WindEurope’s Central Scenario forecast, he
said, 323 gigawatts of cumulative wind energy capacity would be installed
across the European Union by 2030, of which 253 gigawatts would be onshore and
70 gigawatts offshore. “That would be more than double the capacity installed
at the end of 2016,” Canning said. “With this capacity, wind energy would
produce 888 terawatt-hours of electricity, equivalent to 30 percent of the
European Union’s power demand.”
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