After a ‘disappointing year’ in 2022, a ‘fast-evolving policy environment has set the scene for a period of accelerated deployment’ of wind energy over the coming years, with the industry set to install 136 GW per year, reaching a compound growth rate of 15%, according to GWEC’s Global Wind Report 2023.

The report warns that there is an ‘urgent need to ramp up investment in the supply chain all around the world’. GWEC suggests that both the US and Europe are likely to see supply bottlenecks for turbines and components from as soon as 2025, ‘as the wind market sees the positive impact of the US Inflation Reduction Act, increased ambition in Europe, continued rapid build out in China and large developing countries speeding up their deployment’.

‘Decisions made by policymakers will have a decisive impact on whether the world will be able to carry out the energy transition within the necessary time frame, and the cost of the transition,’ says GWEC. The Council also notes that: ‘While moves to further incentivise investment in supply chains and create more regional diversification and resilience are to be welcomed, attempts to create rigid local content requirements or implement protectionist trade measures create the risks of sharply higher costs or even serious delays to the necessary expansion of wind and renewables.’

Globally, 77.6 GW of new wind power capacity was connected to power grids in 2022, bringing total installed wind capacity to 906 GW, a growth of 9% compared with 2021, according to the GWEC report.

The world’s top five markets for new installations in 2022 were China, the US, Brazil, Germany and Sweden. Altogether, they made up 71% of global installations last year, collectively 3.7% lower than 2021. This was primarily due to the world’s two largest markets, China and the US, losing a combined 5% market share compared with the previous year – the second consecutive year that both countries have lost market share.

Regionally, North America is expected to add 60 GW of onshore wind capacity in the next five years, of which 92% will be built in the US and the rest in Canada. Meanwhile, with strong growth coming back in established European markets such as Germany, Spain, the UK, France, Italy and Turkey, the European onshore market is forecast to take off again from 2024.

Elsewhere, 17 GW of new capacity is expected to be added in Africa and the Middle East region over 2023–2027, of which 5.3 GW will come from South Africa, 3.6 GW from Egypt, 2.4 GW from Saudi Arabia and 2.2 GW from Morocco.

Meanwhile, some 26.5 GW of onshore wind is predicted to be added in Latin America in the next five years, with Brazil, Chile and Colombia contributing 78% of the additions, according to the report.

GWEC says that it expects the 2 TW milestone to be achieved in just seven years. Compared with the 2030 global outlook released alongside last year’s Global Wind Report, it has increased its forecast for total wind power capacity additions for 2023–2030 by 143 GW (13% year-on-year). The main reasons behind this upgrade include:

• Energy system reform in Europe, replacing fossil fuels with renewables to achieve energy security in the aftermath of Russia’s invasion of Ukraine.
• China’s commitment to further expand the role of renewables in its energy mix.
• An anticipated 10-year installation uplift in the US, driven by the passage of the Inflation Reduction Act (IRA).

Looking at the supply chain, China dominates global onshore wind turbine nacelle assembly, with 82 GW of identified annual capacity. With 21.6 GW of annual assembly capacity per annum, Europe is the world’s second largest onshore turbine nacelle production base, followed by the US (13.6 GW), India (11.5 GW) and Latin America (6.2 GW).

GWAC concludes that the supply chain in China, India and Latin America will have enough nacelle production capacity to accommodate demand, while the rest of world, in a business-as-usual scenario, will continue to rely on imported wind turbines to cope with the anticipated growth.

Compared with onshore wind, the supply chain for offshore wind turbines is more concentrated, notes the report, due to the fact that more than 99% of total global offshore wind installation is presently located in Europe and the Asia-Pacific region. China is the world’s number-one offshore turbine nacelle production centre, with annual assembly capacity of up to 16 GW, of which 1 GW is owned by one western turbine original equipment manufacturer (OEM).

Goldwind and Vestas in photo finish for top spot
Meanwhile, a recent study from BloombergNEF reports that global commissioning of wind turbines fell 15% to 86 GW in 2022, as supply chain constraints and uncertainty around subsidies hit project development.

The majority of new wind farms were added on land (89%), as commissioning of new offshore turbines fell to 9.1 GW – down 46% compared with 2021.

Echoing GWEC’s warning, Cristian Dinca, Wind Analyst at BloombergNEF, says: ‘Alarm bells should be ringing. Governments around the world are increasing their ambition on decarbonisation and, at the same time, new additions are slowing on the ground.’

According to the report, Goldwind edged out Vestas to the top spot in the global wind turbine supplier ranking. The company supplied 12.7 GW of projects last year, almost 90% of which were for its home market. Denmark-based Vestas commissioned 12.3 GW overall in 2022, 3 GW ahead of its US-based rival GE, which was in third place. This meant that the top three spots were filled by companies from China, Europe and the US, respectively. Envision – another manufacturer based in China – finished fourth, and Siemens Gamesa and Mingyang tied in fifth place.

European call to restore investor confidence
In related news, according to WindEurope’s latest report, Europe invested just €17bn in new wind farms in 2022, down from €41bn in 2021 and the lowest investment figure since 2009 – ‘a stark warning to governments and policymakers’.

Commenting on the report, WindEurope CEO Giles Dickson says: ‘The EU needs to build 31 GW of new wind turbines every year to reach its 2030 targets. But the numbers speak a different language. Last year’s investments in new wind farms only add up to 10 GW. At the same time turbine orders are down and the European Union (EU) is only building half as much new wind as it needs. The EU must urgently restore investor confidence and channel money into its wind energy supply chain if it wants to reach the REPowerEU objectives.’

US offshore wind expansion plans
Looking to the US, the Department of Energy (DOE) has recently unveiled its Offshore Wind Energy Strategy, summarising the Department’s efforts to meet President Biden’s goal of deploying 30 GW of offshore wind energy by 2030 and setting the nation on a pathway to 110 GW or more by 2050. Offshore wind is expected to play an important role in helping the US achieve its target of a carbon-free electricity sector by 2035.

The strategy has four pillars:

• Now: Lower costs from $73/MWh to $51/MWh by 2030, develop a domestic supply chain, and inform sustainable, just deployment of fixed-bottom offshore wind.
• Forward: Achieve the Floating Offshore Wind Shot goal of reducing cost by over 70% to $45/MWh by 2035, establish US leadership in floating offshore wind design and manufacturing, and inform sustainable, just deployment of floating offshore wind.
• Connect: Enable reliable and resilient transmission solutions for large-scale offshore wind deployment.
• Transform: Expand offshore wind co-generation technologies for widespread electrification and decarbonisation.

New UK wind record
Meanwhile, new statistics released by the UK government show that the UK’s wind farms set new annual electricity generation records in 2022, producing enough power to meet the needs of 22.8 million homes.

Published by the Department for Energy Security and Net Zero, the figures reveal that wind generated nearly a quarter of the UK’s electricity last year (24.6%, 80.2 TWh), up from 21% (64.7 TWh) in 2021 and an all-time annual high.

Offshore wind provided a record 13.8% of the nation’s power (45 TWh), up from 11.5% (35.5 TWh) in 2021, while onshore wind generated a record 35.1TWh (10.8%).