2015 was a record year for the offshore wind industry, doubling the capacity installed globally in 2014. Douglas-Westwood (DW) forecasts fewer additions in 2016 relative to 2015, however, the level of projects entering construction and the diversity of locations expected in 2016 bodes well for a larger global market in the years to come.
Capacity additions will grow significantly post-2016, peaking at 9.2GW in 2022. Closer to home, this year signals the start of construction for a number of Round 3 projects and movement into a new phase of gigawatt-scale projects. Both the UK and Germany will install over 10GW each by 2025, resulting in a hive of offshore wind activity in North Sea – a draw for many participants in the local oil and gas supply chain. Elsewhere, both the USA and South Korea are expected to commission their first offshore wind arrays this year at the 30MW Block Island and Tamra Projects respectively. China is forecast to install over 10GW of capacity – lower than previous expectations – yet the country remains a key growth market.
This year marks a number of industry milestones, decommissioning of offshore wind arrays has begun with Yttre Stengrund, whilst other key future markets such as France and Taiwan will begin construction on their first offshore farms.
Capital Expenditure (Capex) on projects which have passed the conceptual stage of development will total €200 billion (bn) between 2016 and 2025 – there is potential upside of €70bn from currently speculative and conceptual projects. Offshore wind is still considered a costly power source by many, yet costs are falling as larger turbine models and greater project scale combine to give higher yields and improved operational efficiency. This upsizing presents major challenges for installation contractors, however, we see a rapid response via innovations in vessel design and construction methods – anticipating the upsizing of components to continue beyond 2025.
The seventh edition of the DW World Offshore Wind Market Forecast provides a ten-year view of the sector through to 2025. Cumulative offshore wind capacity is forecast to reach 74GW, driven by a large number of developments taking place in the UK, Germany and China. Our segmented analysis anticipates the installation of over 11,600 turbines, nearly 12,000 foundations and 38,000km of cable over the next ten years – split by country and by component type. The report also forecasts demand for vessels and helicopters used for offshore wind through to 2025, providing a broad analysis of the global offshore wind market, its segments and prospects.