The depletion of fossil-fuel reserves and the declining cost of wind energy generation are expected to lead to a surge in offshore wind energy installations, especially in the U.K., finds a new report from research and consulting firm GlobalData.
According to the report, global offshore wind power capacity is expected to skyrocket, from a cumulative installed capacity of 5.1 GW in 2012 to a whopping 54.9 GW by the end of the decade. This represents a compound annual growth rate of 34.5%.
The U.K. is a major player in the offshore wind power market, thanks to its substantial financial commitment and ideal location. With 2.7 GW installed last year, the nation accounted for more than half of the world’s installed offshore wind power capacity last year.
“While risks for offshore developers remain - in particular, the potential rationing of Contracts for Difference under the levy control framework, the still nascent transmission regime and the competition from nuclear power - the U.K. government is firmly supporting offshore wind via the energy bill,” says Jonathan Lane, GlobalData’s head of consulting for power and utilities.
Offshore wind is expected to make a large impact on the U.K.’s 2020 renewable energy targets, and a major expansion is planned. As a result, the country’s installed offshore wind power capacity is expected to increase by almost 800% to 21 GW by the end of 2020, GlobalData forecasts.
According to the report, the offshore wind power industries of several other countries are also expected to undergo massive expansion over the next decade. Germany, in particular, has plans to grow its offshore wind sector substantially in the future, after having announced targets of 25 GW of installed capacity by 2030 and 95 GW by 2050.
Between 2012 and 2020, however, Germany’s installed offshore wind power capacity is expected to climb from 220 MW to 8 GW, according to GlobalData.