Offshore Wind Outlook 2019
The International Energy Agency developed Offshore Wind Outlook 2019. The most complete global study on the offshore wind sector, that combines the market developments and the latest technology. It includes a specially commissioned new geospatial analysis of the offshore turbines, wind speed and quality along the coastline around the world.
Offshore wind is considered one of the largest contributors to renewable electricity supply and to the efforts of decarbonizing energy systems. In the coming decades, offshore wind power will turn into a USD1 trillion of cumulative investment by 2040.
How is the offshore wind market today?
- By mid-2019, there were more than 5 500 offshore turbines connected to a grid in 17 countries.
- In 2018, 23 GW of offshore wind capacity was completed.
- Between 2010 and 2018, the United Kingdom, Germany, Belgium, the Netherlands, and Denmark together provided 2.7 GW of capacity.
- In 2018, China alone added 1.6 GW of offshore wind capacity.
- In 2018, offshore wind power accounted for only 3% of the global electricity supply.
- During 2018, the offshore wind industry attracted USD20 billion of share investment. The European Union has been one of the largest investors.
Offshore wind has great potential to supply electricity needs in the future.
Governmental support and the implementation of policies, the development of new technological devices, such as larger turbines and floating foundations, as well as decreasing costs, enabled the rapid growth of the offshore wind market. Between 2010 and 2018, the global offshore wind market grew by approximately 30%. The countries leading this electricity shift are Germany, the United Kingdom, Denmark and, more recently, China.
According to a geospatial analysis undertaken by the IEA, floating turbines could meet the electricity demand in several countries, including the United States, Europe, and Japan. Global electricity demand is currently 23 000 TWh. Floating turbines in water less than 60 meters deep and within 60 km from the shore can potentially produce 36 000 TWh.
The attributes of offshore wind allow it to be a competitive source of electricity.
Contrary to other renewable sources, offshore wind provides more security to the electricity system. It generates electricity during all hours of the day and is able to produce more electricity during the winter season in Europe, the United States and China, and during the monsoon in India.
The technology costs of producing floating turbines are falling. By 2040, costs are projected to decline by approximately 60%. The new policy frameworks support projects to secure low-cost financing enabling a rapid transition to a decarbonized electricity system. Furthermore, there are business opportunities to merge competences from the oil and gas sector, especially regarding offshore expertise. This can be a market opportunity of USD 400 billion or more in Europe and China.
In addition, offshore wind is projected to lower global emissions with 5 to 7 billion tonnes of CO2.
There are still several challenges that delay the market’s growth
There is a lack of long-term planning in the offshore wind sector. It is important that governments provide a long-term vision that provides effective system integration and security during periods of low wind availability. By doing this, it is easier to attract multibillion-dollar investments.