MAKE Consulting are predicting short-term pain but long-term gain for the Europe, Middle East and Africa (EMEA) grid-connected wind market, according to the inaugural EMEA Wind Power Outlook Report published earlier this month. They note that 7 of the top 10 global emerging markets are located in the EMEA region, which highlights the importance of the region in terms of the industry’s growth globally.
The general feeling of the MAKE report is that the EMEA region is set to see a contraction of demand for wind power over the next 18 months, due in large part to “policy uncertainty” across the European Union. Despite moderating regulatory uncertainty and “predominantly positive” regulatory momentum, MAKE are still predicting market contraction across the region to deepen into 2014, despite an overall global recovery of the wind industry and continued growth in the EMEA offshore and Emerging Markets.
We have seen recently various countries — most notably China — make inroads into the Africa solar PV market, redirecting manufacturing and investment to the largest emerging market continent left. Following tariffs levied against them in Europe, China began to make it known it was planning on expanding its panel manufacturing into Africa. While Google made its first African renewable energy investment of $12 million into the $260 million Jasper Power Project, a 96-megawatt (MW) solar photovoltaic (PV) facility to be built near Kimberley in South Africa’s Northern Cape Province.
The African wind industry, however, has seen steady growth over the past few years, as seen in the chart above (courtesy of The Wind Power).
Following MAKE’s assertion that offshore wind will be a predominant driver of growth over the next 18 months, it makes sense to take a look at some of the offshore projects in Africa. The country of Cape Verde on the north-west coast of Africa recently installed 5 offshore wind farms, although its capacity is currently hovering under 40 MW. However, further north in the country of Tunisia, it’s a different matter, with over 100 MW of wind capacity thanks to a 50 MW growth in 2012.
Meanwhile, according to the European Wind Energy Association, the annual installed offshore wind capacity in Europe has already moved above 1000 MW for 2013, falling just short of 2012’s full year total.
According to the stats, 277 wind turbines were connected to the grid to total 1,045 MW. Two of the big operations connected to the grid so far this year were the London Array wind farm and the Anholt Offshore Wind Farm, together adding up to 750 MW connected to the grid.
The EWEA were also critical earlier this year of 2012’s growth in the industry, noting that the 2012 figures do not reflect the “significantly negative impact” of economic, regulatory, and political uncertainty that has existed in Europe since 2011. We covered the relevant EWEA report in February of this year, which included the EWEA’s own warnings that 2013 and 2014 were going to be tough years for the European wind industry.
Only days before, however, the EWEA had announced that they believed there were significant opportunities for growth in emerging markets, such as Romania, Poland, and Turkey.
“These emerging markets are not only important in their own right, but they have increased perceived importance given the state of wind energy markets elsewhere in Europe,” Pierre Tardieu from EWEA said on launching the report.
Emerging markets “are experiencing teething problems very similar to what we’ve experienced in the rest of the world,” said Inigio Sabater Eizaguirre from Vestas, who was in attendance at the annual meeting. He added that the European markets are attractive to companies like Vestas and that the ongoing recovery from the economic crisis is “big incentive” to look for new markets outside of the well-established markets already in existence throughout Europe.
MAKE believe that the European Union will meet their 2020 renewable electricity production targets with only 93% of its National Renewable Energy Action Plans (NREAP) targets met. They believe that the Southern European and Offshore targets will not be met, due primarily to “weaker-than-expected electricity demand growth.” Nevertheless, the EU Offshore market is still expected to be one of the brighter spots in a mediocre period of growth.
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