Report: Asia-Pacific Set to Overtake Europe in Offshore Wind Power

sasac — China Three Gorges Corporation's Xinghua Bay offshore wind farm (File image courtesy State-owned Assets Supervision and Administration Commission of the State Council)

World investment in offshore wind power took off in 2020, especially in East Asia, according to a new report from the Renewables Consulting Group.

Through the start of 2021, about 500 gigawatts of new and existing capacity have been announced or installed worldwide, spanning a wide range of geographic and socioeconomic markets. The Asia-Pacific region accounts for the largest share with about 45 percent of the total, and China alone accounts for about 12 percent. The European market has by far the largest percentage of operational offshore wind farms, but it will be eclipsed by Asian developers in the long term if currently-announced projects are completed.

"With a steady and predictable framework, we continue to see positive developments emanating from emerging markets, such as in the APAC and the Americas regions. The ongoing maturation of technology and declining costs for offtake have inspired governments and investors to embrace offshore wind, with many authorities touting offshore wind as a cornerstone to a green economic recovery in the wake of a global recession," said Lee Clarke, COO of RCG.

Global investment numbers for offshore wind set a new record in 2020 at $30 billion, covering about 8.3 gigawatts of newly-confirmed capacity. New developments announced in the Asia-Pacific are enough to displace Europe as the leading region for project capacity for the first time ever. In a remarkable development, the UK is on track to lose its number-one ranking by the end of the year - falling below both Vietnam and China, which have separate portfolios totaling about 65 gigawatts of announced capacity each. However, not all of these proposed projects will make it to development, RCG cautioned.

Floating offshore wind is a promising technology for the future expansion of the market, according to RCG. Though not in widespread use, about 100 megawatts of floating turbine capacity is in operation worldwide, and the first commercial-scale lease auction for floating wind sites is now under way in France. Additional floating wind auctions are coming soon in Scotland in Norway, and the Biden administration has announced plans to open floating-only resource areas off California for prospective development.