It’s no surprise that the offshore wind market has been increasing in popularity over the past couple of years as the technology has become more affordable and installation techniques have been fine-tuned to be more efficient. Subsequently, the market for offshore wind power globally is expected to increase to nearly 40 GW by 2020, according to research and consulting firm GlobalData.
GlobalData’s report, Offshore Wind Turbines and Foundations – Global Market Size, Market Share, Regulations and Key Country Analysis to 2020, forecasts the market to increase more than fivefold — growing from 7.1 GW in 2013 to 39.9 GW in 2020 (which for you finance-junkies out there, equates to Compound Annual Growth Rate (CAGR) of 28%).
The market already registered significant growth between 2006 and 2013 — growing from 0.9 GW in 2006 to the aforementioned 7.1 GW in 2013. Of this growth, a significant percentage came online in 2013, a total of 1.6 GW, driven mainly by the UK, Germany, Denmark, and Belgium.
GlobalData believes that offshore wind could become one of the largest renewable power market segments by 2020, thanks specifically to the UK, Germany, and China, who currently have a number of projects currently in the planning and construction stages.
“Offshore wind power is increasingly being explored for its high yield, due to stronger and more consistent winds compared to onshore, and the scope that this provides for the construction of large-scale projects,” said Swati Singh, GlobalData’s Analyst covering Power. “An additional benefit is the fact that future offshore wind power technology development will ensure a decline in the average cost per megawatt, although overall project costs are expected to rise in countries with wind farms planned in deeper water and further from the shore.”
Earlier this month GlobalData released figures showing that the UK has built up 52% of the global cumulative installed capacity of offshore wind energy. On top of the UK’s strong efforts, Europe as a whole has made its own strides towards a strong offshore wind market, with 16 offshore wind farms totaling 4.9 GW currently under construction.
There are challenges ahead, according to Swati Singh, with environmental concerns existing as the most likely opponent to any offshore wind farm. Additionally, as with any relatively-new industry, a lack of skilled personnel and sophisticated technology designed specifically for the offshore industry will hamper full-scale growth.
“Despite these barriers, GlobalData expects offshore wind’s share in the global wind power market to climb from 2.2% in 2013 to 6.1% by 2020, as more countries eye the advantages of this renewable energy technology,” Singh concludes.
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