GWEC Market Intelligence has released its updated market outlook concluding that an additional 330 GW of wind energy capacity will be installed from 2019 to 2023, an increase of 9 GW from its market outlook published in Q1 2019. Main markets driving this volume increase are the US and Chinese onshore markets, which will both experience an installation boom over the next two years with 6.5 GW and 10 GW added capacity respectively from the Q1 2019 market outlook. The growing role of offshore wind in the global energy transition is a major reason for boosting overall growth, and will make up approximately 18% of total wind energy capacity by 2023, up from 9% in 2018. The continued growth of wind energy globally will be driven by the increasing cost competiveness of wind energy as well as market-based mechanisms such as auctions, tenders, and bilateral PPAs.
According to the updated market outlook released by GWEC Market Intelligence, an additional 330GW of new wind energy capacity will be added to the global energy market from 2019 to 2023, bringing total capacity to over 900 GW. The outlook has been increased by additional 9 GW from the outlook published in Q1 2019 in GWEC’s annual Global Wind Report.
Through analysis of the developments of wind markets across the world, two main trends have been identified that will drive growth beyond 2023; the increasing share of so-called subsidy-free projects, and an increasing number of bilateral PPAs. Together, these two mechanisms will contribute to the cost competitiveness of wind energy and provide assurance for large-scale project development and the continued growth of wind energy globally.
Although there was a decrease in the outlook for India and Germany due to their challenging market conditions including the execution of their auctioned capacity, the growth in other markets more than make up for this deficit. With China going subsidy free by 2021 for onshore wind and the Production Tax Credit phasing out in the US, there will be an installation rush over the next two years in these two leading onshore markets.
The forecasts for emerging markets in Latin America, South East Asia, Africa and the Middle East have all been increased as well due to positive market developments. Additionally, it must be acknowledged the importance of offshore wind for driving growth, as it is set to take off globally over the next few years with a compound annual growth rate of 8% between 2019 and 2023, double that of onshore wind.
Wind energy is now one of the most cost-competitive energy sources available, so it is no surprise we will continue to see volume growth as global energy demand continues to increase. On average, 60 GW of onshore wind and 8-10 GW of offshore wind will be added worldwide until 2023. Even when not considering the two key growth markets of US and China, it will still be seen installation growth levels similar to those of the 2009-2010 wind energy boom in the other markets and regions. Although this outlook is very positive, it is not enough to meet the renewable energy targets needed to keep global warming under 1.5 C°.
Total new installations by year for onshore and offshore wind
2018: 50.12 GW
2019: 71.97 GW
2020: 76.43 GW
2021: 61.32 GW
2022: 62.02 GW
2023: 61.83 GW
Changes by region from Q1 2019 (onshore only)
North America: +6.5 GW
Latin America: +2 GW
Europe: -5.9 GW
Africa and the Middle East: +0.8 GW
Asia Pacific: +5.7 GW