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The global offshore wind turbine market stood at $24,683.3 million in 2019. Some of the key growth factors for the offshore wind turbine industry include the technological advancements in offshore plants and increasing investments in renewable sources of energy, along with favorable government policies.
The impact of the COVID-19 pandemic has been felt on almost every industry across the world, and it is more evident from the declining global economy. The pandemic has also created a significant negative impact on the offshore wind turbine market, majorly on account of the supply chain disruptions. The supply of components and materials from China was interrupted in February 2020, due to the shutting down of various factories, in order to curtail the spread of coronavirus. However, with the lifting of the government restrictions on manufacturing and international trade, the market is likely to recover from the end of 2021 onward.
Shallow-Water-Depth Installations To Retain Their Dominance
Shallow-water-depth wind installations held the largest share, on the basis of water depth, in 2019, and the trend is likely to continue during the forecast period. This is majorly ascribed to the fact that shallow-water regions are suitable for setting up the foundation for wind towers, owing to the comparatively higher convenience they offer over transitional and deep-water installations. Additionally, the maintenance and repair of installations in shallow water are easier to take care of, as compared to transitional and deep-water installations. Owing to such advantages, shallow-water installations are expected to account for the largest share in the offshore wind turbine market in 2026.
Fixed Installations To Account for Larger Share
In 2019, the fixed category held the larger share, on the basis of installation, in the offshore wind turbine market. This is primarily ascribed to the several benefits of fixed installations over floating wind power installations, including economic feasibility, as well as comparatively easier commissioning and decommissioning processes. Moreover, the cables of fixed wind plants retain their position, due to a weaker impact of waves and currents, which is not the case with floating installations. Owing to such factors, the fixed category is projected to retain its dominance on the offshore wind turbine market throughout the forecast period.
3 Megawatt (MW)-to-5 MW Plants To Witness Most Offshore Wind Turbine Installations in 2026
The 3 MW-to-5MW category is expected to hold the largest share in 2026, on the basis of turbine capacity. 3 MW-to-5 MW wind turbines have a high electricity generation capacity, owing to which companies are expected to make hefty investments for the setup of such plants, in order to generate a higher yield. In addition, 3 MW-to-5 MW wind towers require low maintenance, which reduces the overall operating costs of the plant. Therefore, the 3 MW-to-5 MW category is expected to witness the most installations in 2026 in the offshore wind turbine market.
Asia-Pacific (APAC) To Witness Most Installations in 2026
The offshore wind turbine market in the APAC region is expected to witness the highest number of wind projects, on account of the increasing government initiatives toward promoting the offshore installation of windmills. The rapidly increasing energy demand in the region, along with a high dependence on fossil-fuel energy generation, is also supporting the demand for cost-effective and environment-friendly wind turbine installations on lakes, seas, and oceans.
Additionally, the Chinese government has a national goal of deploying 400 Gigawatts (GW) of wind energy by 2030. The rapid increase in the number of proposed projects has been driven by the individual provincial goals of Jiangsu, Fujian, and Guangdong, of 3.5 GW, 2 GW, and 2 GW offshore wind power capacity, respectively, which were met in 2019.
Moreover, China’s National Energy Administration determined that offshore wind power price in 2019 and beyond will be set by competitive auctions, instead of feed-in tariffs, in an effort to increase the competition and reduce costs in the industry. These cost reduction and province-level targets of deploying wind energy plants, in conjunction with a rapidly maturing supply chain, are expected to accelerate the offshore deployment of windmills in the APAC region, in turn, promoting the growth of the offshore wind turbine market.
Developments in Turbine Technology Observed as Key Trend in Offshore Wind Turbine market
During the last decade, the energy generated by offshore wind turbine was more expensive than the present. A higher number of smaller turbines had to be installed, in order to meet the required energy demand. Continuous developments in the turbine technology have been carried out, in order to augment the turbine capacity and yield more energy, with a focus on reductions in cost. Higher-capacity turbines have larger swept areas and yield more energy for the same resource quality, thereby leading to higher wind farm output levels.
Most of the wind turbines available for offshore applications before 2018 were of single-digit MW capacity, and in September 2018, MHI Vestas Offshore Wind A/S launched the first double-digit-capacity wind turbine — V164-10.0 MW — which indicates focus toward higher-capacity turbines. Therefore, such developments are expected to propel the offshore wind turbine market during the forecast period.
Technological Advancements in Offshore Foundations
The increase in technological developments by manufacturers, in order to come up with better offshore foundations, has significantly raised the growth potential of the market, by opening up more geographical areas for the establishment of wind energy farms. The global pipeline for offshore wind energy reached 4,888 MW in 2018, with 38 announced projects and 46 MW of operating projects.
Offshore wind turbine industry is at a developing stage, and it undergoes constant development. For instance, the first 30 MW demonstration project “Hywind,” commissioned in October 2017, is now operating successfully in the U.K. Such developments have unleashed the potential of deep-water wind power, relevant for countries with limited land area. Considering such factors, the offshore wind turbine market is expected to witness strong growth in the coming years.
|Base Year (2019) Market Size||$24,683.3 million|
|Report Coverage||Market trends, regulatory landscape, Porters five forces analysis, value chain analysis, revenue estimation and forecast, segmentation analysis, regional and country breakdown, company share analysis, companies’ strategic developments, competitive analysis, company profiling|
|Market Size by Segments||Water depth, installation, turbine capacity, geography|
|Market Size of Geographies||U.S., Canada, Germany, U.K., Denmark, Netherlands, Belgium, Japan, China, India, Vietnam, South Korea, Brazil, Mexico|
|Secondary Sources and References (Partial List)||American Wind Energy Association, Bureau of Ocean Energy Management, Energy Information Administration, Engie SA, Environmental and Energy Study, Global Wind Energy Council, International Energy Agency, International Renewable Energy Agency|
Rising Investments in Renewable Energy Sector and Supportive Government Regulations
With the increasing awareness regarding the benefits of renewable sources of energy generation, investments in the offshore wind energy sector have witnessed a rise. Additionally, in 2018, British Petroleum (BP) reported that the global proven oil reserves are sufficient to meet only 50.6 years of the world’s demand at the 2016 production levels. Fossil-fuel-based energy is not only facing resource limitations, but it also has serious environmental impacts and comes with potential risks with waste disposal difficulty. Therefore, the world is switching to renewable and clean sources, such as offshore wind energy.
Moreover, governments worldwide are increasingly investing in renewable sources of energy, to meet future energy demands, while minimizing the traditional energy supply. Considering such factors, the offshore wind turbine market is expected to grow during the forecast period.
Major Players Entering into Partnerships
The offshore wind turbine market is partially consolidated in nature, with the presence of market players such as MHI Vestas Offshore Wind A/S, Siemens Gamesa Renewable Energy S.A., and Envision Energy.
In recent years, players in the industry have entered into partnerships and agreements, in order to collectively enhance their market coverage. For instance:
Some of the Key Market Players in the Offshore Wind Turbine Market Include:
The Offshore Wind Turbine Market report offers comprehensive market segmentation analysis along with market estimation for the period 2014–2026.
Based on Water Depth
Based on Installation
Based on Turbine Capacity