2023年全球风能报告（英文版）---全球风能理事会VIP专享VIP免费

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GLOBAL WIND ENERGY COUNCIL

GWEC | GLOBAL WIND REPORT 2023

Associate Sponsors

Leading Sponsor

Supporting Sponsor

GWEC.NET

VERI_1101664_COUV_FI_A4_GB.indd 1 4/02/11 15:40:22

Foreword 3

Executive summary 7

Wind energy: The coming renewables acceleration 13

Part One: A new energy market 17

Part Two: Challenges in the supply chain 23

Part Three: The risks and opportunities of regionalisation 33

Part Four: The IRA is set to turbocharge the US wind sector 41

Part Five: How Europe plans to rise to the challenge 47

Part Six: Will China continue to be the market leader? 51

Part Seven: How to achieve a just transition 57

Case studies 63

Focus on offshore wind 69

Markets to watch 83

Market Status 2022 91

Market Outlook 2023–2027 103

Appendix 111

Table of contents

Global Wind Energy Council

Rue de Commerce 31

1000 Brussels, Belgium

info@gwec.net

www.gwec.net

Lead Authors

Mark Hutchinson, Feng Zhao

Contributors and editing

Ben Backwell, Emerson Clarke, Esther Fang, Ramón

Fiestas, Jeanette Gitobu, Navneet Khinda, Reshmi

Ladwa, Anjali Lathigara, Wanliang Liang, Wangari

Muchiri, Thoa Nguyen, Liming Qiao, Marcela Ruas,

Martand Shardul, Thang Vinh Bui, Nadia Weekes,

Rebecca Williams

Additional contributions

Asociación Mexicana de Energía Eólica, Asociación

Costarricense de Productores de Energía, SER

Colombia – Asociación Energías Renovables,

Associação Brasileira de Energia Eólica e Novas

Tecnologias (ABEEólica), Camara Eólica Argentina,

Asociación Peruana de Energías Renovables – SPR,

Asociación Chilena de Energías Renovables y

Almacenamiento – ACERA, Japan Wind Power

Association, Renewable Energy Institute – Japan,

Korea Wind Energy Industry Association, China

Wind Energy Association, Developers of Renewable

Energy for AdvanceMent (DREAM) – Philippines,

Thailand Wind Energy Association, Mongolian

Renewable Energy Association, Indonesian

Renewable Energy Society (METI), Iran Renewable

Energy Association – IRWEA, Electricity Sector

Association of Kenya, South African Wind Energy

Association – SAWEA, Clean Energy Council

(Australia), American Clean Power, Canadian

Renewable Energy Association − CanREA,

WindEurope.

We received valuable review and commentary

for this report from

•Rina Bohle Zeller (Vestas)

•Dan Wetzel (IEA)

Front cover image courtesy of Vestas

Published

27 March 2023

Design

lemonbox

www.lemonbox.co.uk

GLOBAL WIND ENERGY COUNCIL

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GLOBALWINDENERGYCOUNCILGWECGLOBALWINDREPORT2023AssociateSponsorsLeadingSponsorSupportingSponsorGWEC.NET4/02/1115:40:22Foreword3Executivesummary7Windenergy:Thecomingrenewablesacceleration13PartOne:Anewenergymarket17PartTwo:Challengesinthesupplychain23PartThree:Therisksandopportunitiesofregionalisation33PartFour:TheIRAissettoturbochargetheUSwindsector41PartFive:HowEuropeplanstorisetothechallenge47PartSix:WillChinacontinuetobethemarketleader?51PartSeven:Howtoachieveajusttransition57Casestudies63Focusonoffshorewind69Marketstowatch83MarketStatus202291MarketOutlook2023–2027103Appendix111TableofcontentsGlobalWindEnergyCouncilRuedeCommerce311000Brussels,Belgiuminfo@gwec.netwww.gwec.netLeadAuthorsMarkHutchinson,FengZhaoContributorsandeditingBenBackwell,EmersonClarke,EstherFang,RamónFiestas,JeanetteGitobu,NavneetKhinda,ReshmiLadwa,AnjaliLathigara,WanliangLiang,WangariMuchiri,ThoaNguyen,LimingQiao,MarcelaRuas,MartandShardul,ThangVinhBui,NadiaWeekes,RebeccaWilliamsAdditionalcontributionsAsociaciónMexicanadeEnergíaEólica,AsociaciónCostarricensedeProductoresdeEnergía,SERColombia–AsociaciónEnergíasRenovables,AssociaçãoBrasileiradeEnergiaEólicaeNovasTecnologias(ABEEólica),CamaraEólicaArgentina,AsociaciónPeruanadeEnergíasRenovables–SPR,AsociaciónChilenadeEnergíasRenovablesyAlmacenamiento–ACERA,JapanWindPowerAssociation,RenewableEnergyInstitute–Japan,KoreaWindEnergyIndustryAssociation,ChinaWindEnergyAssociation,DevelopersofRenewableEnergyforAdvanceMent(DREAM)–Philippines,ThailandWindEnergyAssociation,MongolianRenewableEnergyAssociation,IndonesianRenewableEnergySociety(METI),IranRenewableEnergyAssociation–IRWEA,ElectricitySectorAssociationofKenya,SouthAfricanWindEnergyAssociation–SAWEA,CleanEnergyCouncil(Australia),AmericanCleanPower,CanadianRenewableEnergyAssociation−CanREA,WindEurope.Wereceivedvaluablereviewandcommentaryforthisreportfrom•RinaBohleZeller(Vestas)•DanWetzel(IEA)FrontcoverimagecourtesyofVestasPublished27March2023Designlemonboxwww.lemonbox.co.ukGLOBALWINDENERGYCOUNCILGWECGLOBALWINDREPORT20231GWEC.NET2ForewordCOP27mayhaveconcludedwiththetargetof1.5Cincriticalcondition,buttheglobalcommitmenttorenewableenergyisstrongerthanever.MeetingtheobjectivesoftheParisAgreementcallsforustohalveglobalgreenhousegasemissionsby2030.That’slessthansevenyearstoreplaceswathesofhigh-emissiontechnologieswithzero-orlow-carbonalternatives.Intermsofenergy,thismeansleavingbehindatraditionalsystemdesignedaroundfossilfuelsandinstallinganewone–asfastaswecan.Aimingfor61%oftotalelectricitygenerationtocomefromrenewablesby2030,theIEAestimatesthatrenewableenergycapacitywillhavetotriple,andthatmostofthisgrowthistocomefromwindandsolarPV.1Scalinguprenewableenergyiskeytotheenergytransition.Beyondtheinstallationofrenewablepower,thisalsomeansinstallingtransmissionlines,buildinggridsandstoragesolutions,androllingouttechnologiesthatenablesystemflexibility.Deliveringtothisdemandrequiresstrongersupplychainsacrosstherenewablesindustry–justatatimewhensupplychainsarethreatenedbyinflation,risinginterestrates,geopoliticsandbottlenecks.Investmentsinwindin2022decreasedinEurope,theAmericas,theMiddleEastandAfrica.TheonlyexceptionwastheAsia-Pacificregion.Thismarksaparadoxduringaperiodwhenvariouscrisesaredisruptingenergysecurityandclimatedeadlinesaredrawingcloser.Windenergyhasneverbeenmoreneeded:itbuildsenergysecurity,lowersthecostofelectricityandsupportsdecarbonisation.Lastyear’sinvestmenttrendsexemplifyhowfasterpoliticalactionisnowcritical.Thisyeariscrucialforstrengtheningthesupplychainsthatbolsterrenewableenergy.Healthyindustriesrequirethrivingmarkets.Atpresent,permittingandgridbottlenecksarelimitingvolumestoacripplingdegree.Profitablecompaniesmustbeabletosetcost-coveringprices.Policiesmustseekabalancebetweencost-competitiveelectricity,viableprojectsandhealthysupplychains.Inthecurrentenvironment,pricesareoftenpushedtotheirminimum,whiletechnicalandsustainabilityrequirementsincreasecostsinparallel.Renewablesdependonaskilledworkforce,accesstorawmaterials,infrastructureandlow-costfinancing.Mostmarketoutlooksforecastanimminentincreaseindemandforrenewables.Policymakersinmajorrenewableenergymarketshavebeguntoaddressthecurrentchallengesbysupportingthecompaniesthatwillbedrivingtherenewablesscale-up.TheUSA’sInflationReductionAct,Europe’sGreenDealIndustrialPlanandChina’sFive-YearPlanareallclearexamplesofincreasingpoliticalmomentum.Thiswelcomenewscanbringconcerningunderlyingissueswithit.Theglobalwindindustry’sstrengthisitsglobalfootprint.Openingasubsidyraceinsupportoflooselydefinedcleanenergytransitiontechnologieswhileincreasingprotectionismwouldcomeatahugecost–toindustriesandsocieties.Itistimeforgovernmentstorealisethatseriousclimatechangemitigationandsustainableenergysecuritygohandinhand.Governmentsmustalsoacceptthatathrivingrenewablesindustryisthefirststeptoaddressingboth.Decarbonisationistoobigachallengeforonecountryorregionalonetoovercome:onlybyworkingtogethercanweunlocktheaccelerationneededtoachieveacleanenergytransition.GWECanditsmembershaveanimportantroletoplayinsupportingsoundpolicies,collaborationandaction.Ilookforwardtodoingjustthat.WordfromtheChairmanMortenDyrholmChairman,GlobalWindEnergyCouncil1.https://www.iea.org/reports/world-energy-outlook-2022GWECGLOBALWINDREPORT20233Thecomingyearswillmarkacrucialtransitionperiodfortheglobalwindindustry.Laterthisyear,windenergywillreachthehistoricmilestoneof1TWofinstalledcapacity.Ithastakenusaround40yearstogethere.However,thenextTWwilltakelessthanadecade.Theenergyandclimatepoliciesnowbeingpursuedbytheworld’slargesteconomiesinboththe‘West’andthe‘GlobalSouth’pointtoawholenewlevelofambitionandsupportforwindenergyandrenewables.Thesepoliciesarelikelytotakeusto2TWofinstalledwindenergybytheendof2030.Theyaretheconsequenceofgrowingurgencyinthefightagainstdangerousglobalheating;prolongedhighfossilfuelpricesandtheimpactoffossilfueldependenceonsecurity;andthesuccessofourindustryinscalingupandestablishingwindasoneofthemostcost-competitiveandreliablepowersourcesintheworld.Whiletheindustrypushedthroughthenewlevelof100GWofannualinstallationsin2021,thelastfewyearshavenotbeenwithouttheirchallenges.Manyofthemanufacturersattheheartoftheindustryhaveseenmountingfinanciallossescausedby‘racetothebottom’pricing,asaresultofmisguidedgovernmentpoliciesaroundprocurementandofftakearrangements,exacerbatedbyhigherinflationandlogisticscosts.Meanwhile,windprojectshavebeendelayedorstalledbyinadequateandinefficientpermittingandlicensingrules,fromDenmarktoIndiatoJapanandbeyond.Thishascreatedthebizarreparadoxofenergymarketsrewardingfossilfuelcompanieswithrecordprofits,whilerenewableenergycompanieshavestruggledtobreakeven.Asthisreportshows,whilecompanieshaveregroupedtoadapttothenewinflationarypressures,themarkethasstalled,andtheindustryinstalledonly77.6GWin2022.Allthishascomeatatimewhenpolicymakersareracingtoaddresstheenergyandclimatecrisesbydramaticallyincreasingtheirtargetsforwindenergyacrosstheworld.Thesituation,however,isabouttochangeand2023willmarkthestartofadecisiveturnaround.Governmentsofallthemajorindustrialisednationshaveenactedpoliciesthatwillresultinasignificantaccelerationofdeployment.IntheUS,theInflationReductionActhascompletelychangedtherulebookforbothonshoreandoffshorewind,whileintheEU,policymakersareracingtointroducenewrulesandregulationstoenablethehugeincreaseindeploymentthattheREPowerEUplanforesees.InChina,unstoppablemomentumbehindtheenergytransitioncontinues,andtheendofCOVID-19restrictionswillseethereturnoffastereconomicgrowth.LargeemergingmarketeconomiessuchasVietnamandthePhilippinesareenactingnewplansforwind,thesleepingwindpowergiantofIndiaseemssettopickupthepace,andBrazilwillcontinuetoestablishitselfasawindenergypowerhouse.By2024,GWECexpectsonshorewindtopassthe100GWannualinstallationsmark,whileoffshorewindwillinstallmorethan25GWinasingleyearforthefirsttimein2025,andinstallationswillacceleraterapidlyafterthat.Marketconditionswillchange,ascountriesandregionswillhavetocompeteforbadlyneededWemustinvestinsupplychaintobuildthenextTWForewordBenBackwellCEO,GlobalWindEnergyCouncilGWEC.NET4investmentintheirwindsectors:whogetstheinvestmentwilldependonwhohasthemostattractivemarketconditionsandthemostefficientregulators.Forpowerequipment–andthisincludeskeycommoditiessuchascopperandrareearthelements(REEs),powertransmissionequipment,windturbinesandoffshoreinstallationvessels–marketdynamicsarelikelytochangefrombuyers’tosellers’marketsassupplychainsstruggletokeepupwithdemand.AccordingtothedatainthisGlobalWindReport2023,sparecapacityinthewindenergymanufacturingindustryislikelytodisappearby2026.Forsomeinputsandinsomeregions,thesqueezewillbefeltbeforethen.BothEuropeandtheUSarefacingtheriskofsupplychainshortfalls,andthesecouldbeworsenedbypoliciesaimedatreshoringmanufacturingawayfromChinaandprotectinglocalindustryandjobs.Asthisreportshows,whilecreatingmorediversityandresilienceinthesupplychainisanimportantandnecessaryobjective,decisionmakerswillhavetodesignpolicyverycarefullytomakesurethatitallowsthefairexchangeofessentialinputsfortheenergytransition,fostersinnovationandkeepscostsfromrisingunnecessarily.Inordertoensurethatthewindindustryisabletomeettheexpectationsofpolicymakersandsocietyatlarge,itisessentialthatwestartinvestinginnewcapacityandplant,andintrainingandskills,rightnow.Otherwise,weruntheriskthatwewillnotbeabletodeliverourpromises,policymakerswillturntoother,lessefficientalternatives,andsocietywillfailinitsclimategoals.Thismaysoundcounterintuitiveinanenvironmentwherecompanieshavefounditdifficulttokeeptheirbusinessesviable,butitisachallengewecannotignore.Thankfully,thesector’sleaderscanseetheopportunityahead,andcompaniesarealreadyinvesting–despitethehighlyunfavourableconditionsofthelastfewyears–innewmanufacturingfacilities,fromSouthKoreatotheUStoPoland.Muchmoreisneeded,andfast.Thewindindustrywillneedtoforgenewpartnershipswithgovernments,cities,communities,investorsandcustomersinordertoenablethenexteraofgrowth.Workingtogether,wecanputintoplacetherightpolicies,whichwillallowtrillionsofdollarsininvestmentstoflowandthecreationofmillionsofjobs.Asastartingpoint,weneedtoleavethehesitancyofthepastbehindandadoptanewmindsetinourindustry.Thewindindustryisnolongerthehobbysectoroffortyyearsago.Ourtechnologyisresilientandmature,andispoisedtoplayauniqueroleintheenergytransition.Now,inordertodeliveronthepromiseswehavemade,weneedaconfidentwindindustrythatiscapableofmovingboldlyahead.ForewordThewindindustrywillneedtoforgenewpartnershipswithgovernments,cities,communities,investorsandcustomersinordertoenablethenexteraofgrowthGWECGLOBALWINDREPORT20235ForewordInBrazil,wearelivinginatimeofgreatexcitementandrenewedhopeinourpotentialandinthefuture.ThenewgovernmentofPresidentLuizInácio‘Lula’daSilvaisresumingworkonkeyissuesthatwereabandonedinrecentyears,suchasthefightagainstclimatechange,protectionoftheenvironment–especiallytheAmazon–andthereductionofsocialinequalities.Thesearemattersdeartothewindsector,whichpositivelyimpactssocietyfromanenvironmental,socialandeconomicpointofview.TheBrazilianwindpowerrevolutionhasbeenunderwayforsomeyearsnow.Theindustryachieved25.6GWofinstalledcapacityin2022,withwindenergynowholdingafirmpositionasoneofBrazil’sstrongestenergygenerationsectors.Inadditiontothecontinuedgrowthofonshorewind,wehavegreatexpectationsforthedevelopmentofBrazilianoffshorewind.IBAMA,theBrazilianInstitutefortheEnvironmentandRenewableNaturalResources,hasalreadyreceivedprojectproposalsformorethan170GWofoffshorewindenergy.ThisnumberisequivalenttopracticallytheentireBrazilianelectricitymatrixandshowstheextentofinvestorappetiteandtheenormouspotentialforoffshorewindinBrazilianwaters.Thereisnotenoughdemandforthatamountofelectricity,however.That’swheregreenhydrogencomesintoplay.CouplingthistechnologywiththeenormouspotentialforoffshorewindcouldconsolidateBrazil’sstandingasarenewableenergysuperpowerbuildingonitsalreadyadvancedwindenergysupplychainandwiderindustrialandmaritimecapabilities.TherenewableresourcesavailableinBrazil,especiallyitsabundanceofqualitywindbothonshoreandoffshore,arecertainlyuniqueintheworld.Thisopensawindowofopportunityfortheproductionofgreenhydrogen,whichwouldhavethecapacitynotonlytorevolutioniseBrazil’senergymatrix–alreadyoneofthemostrenewableintheworld–butalsotoexportgreenhydrogentoothercountriesthatmaynotbeabletoproducealltherenewableenergytheywillneedtomeettheirenergytransitiongoals.Braziliancompaniesandstategovernmentshavetakenimportantstepstowardsthecreationofagreenhydrogensectorforthecountry,includingagreementstoinvestmorethan200billionUSD.InJanuary,EDPproduceditsfirstgreenhydrogenmoleculeinBrazilandUnigelwillhaveitsfirsthydrogenandgreenammoniaproductionplantincommercialoperationbytheendof2023.From2050,accordingtotheconsultancyRolandBerger,Brazilcouldderiveannualrevenuesof150billionBRLfromgreenhydrogen,ofwhich100billionBRLwouldcomefromexportsalone.1Whatweareseeing,therefore,isanindustrythatisalreadyhereandreadytogrowrapidly,especiallyconsideringtheopportunitiesfordomesticdemand.Currently,Brazilusesfossil-fuelhydrogeninitsfertiliser,refining,chemical,foodandmetallurgyindustries.ReplacingthiswithgreenhydrogenwouldallowdecarbonisationandnetzeroinmanyBrazilianindustrysectorstobecomeareality.Weknowthisisalongroad,butwearealsocertainthatweareontherighttrack.TheBrazilianwindenergyrevolutionisalreadyhereforalltosee–andwillcontinuetogainstrength.Itisjustamatteroftimeanddedicatedworkbythegovernment,investors,companiesandprofessionalsinthesector.Let’sallworktogethertocontinueputtingthewindinBrazil’ssails.Brazil’swindpowerrevolutionElbiaGannoumPresidentofABEEólica,Brazil’swindenergyandnewtechnologiesassociation,andGWECViceChair1.https://valorinternational.globo.com/business/news/2023/01/22/bårazil-has-potential-to-be-largest-producer-of-green-hydrogen-study-shows.ghtmlTransformingthesupplychainfortheindustryofthefutureChristopherL.MapesChairman,PresidentandChiefExecutiveOfficerTheLincolnElectricCompanyAstheglobalwindindustryfocusesonsolvingthesupplychainchallengesaheadfortheexpansionofoffshoreandonshorewind,therearetremendousaccomplishmentsalreadyachieved.Thetransformationofsteelintothekeycomponentsoftheenergytransitionisalreadywellunderway,supportedbyrecordnewinvestmentcommitments.Fromnewsteelplantcapacity,plannedoralreadyonline,topipemills,shipyardsandregionalfabricatorsaroundtheworld,thesenewindustryinvestmentsaredrivingoneofthemostrapidglobalindustrialisationperiodswehaveseen.Theoutcomeofthisprocesswillenabletheworldtobuildandinstallturbines,towersandfoundations(fixed-bottomandfloating)ofimmensesize,neverbeforerealised.Withtheracetowindturbinesof20+MWaccelerating,theoffshorewindsupplychainofthefuturewillneedtoproduceatelevatedlevels,higherthaneverbefore.However,itisclearthatthepresentlevelsofinvestmentcommitmentacrosstheentiresupplychainstillfallwellshortofwhatisrequiredfortheglobalindustrytohitinstalledcapacitytargets.Thesupplychainofthefutureneedsrapidexpansion–inlinewiththeambitionsofitsmainstakeholders.ThisiswhyGWEC’sGlobalWindReport2023isevenmorecrucial,highlightinganumberofkeyactionsnecessaryinboththeshortandlongterm.Whiletherearemanypiecesofencouragingnewsacrosstheglobalsupplychain,therearealsoseveralpracticalchallengestoovercomeifwearetoacceleratecapacitytomeettheinstalledtargetsforecastaroundtheworld.Asakeyglobalsupplierwhosupportstheentirefabricationsupplychainofassetsandinfrastructure,LincolnElectricseestheglobalindustrythroughauniquelens.Keytounlockingthefullcapacityofthesupplychainisinnovation,togetherwithnewinstallationmethods,designsandadvancedtechnologythatcandrivetheprofitablesuccessoftheindustry.Additionally,thecontinuousdevelopmentofahighlyskilledworkforcewillbecritical,aswellastheimplementationofhigherlevelsofautomationsolutions,whichcanreduceprojecthoursandoverallcosts.Today’sindustryleadersknowthatnewtechnologiesforsteeltransformationwillplayacriticalroleinprofitability,particularlyinweldingandcutting,whichcontinuestobeatthecoreoftheexpandingglobalwindindustry.LincolnElectricandothercriticalsupplychainbusinessesareleveragingdecadesofindustryexpertiseandexperiencetoinnovateandsolvethesecriticalchallengesthroughtwokeydrivers:technologyandhigherinvolvementinworkforcetraininganddevelopment.Together,thesecriticalinitiativeswilladvancethegrowingglobalneedsforahighlyskilledworkforcethatcansupporttheambitionsofindustryandcountriesaroundtheworld.BuildingonearliersuccessinoffshorewindacrossEurope–andnowtherapidexpansioninAsiaandtheAmericas–thefutureofthewindindustrydependsonthecombinedeffortsofmany.Theindustryneedscontinuedsupportfromgovernmentsandprivateinvestmentaroundtheworldforfurtheraccelerationandexpansionofthesupplychain.Byaligningtheseresourceswithagrowingroleforwindasakeypartoftheenergytransition,theindustrywillthrive.SponsorThesupplychainneedsrapidexpansion–inlinewiththeambitionsofstakeholdersGWEC.NET6EXECUTIVESUMMARYGWEC.NET8Windin2022Nearly78GWofwindpowercapacitywasaddedlastyear,thelowestlevelinthepastthreeyearsbutstillthethirdhighestyearinhistory.Thiswasachieveddespiteachallengingeconomicenvironmentandadisruptedglobalsupplychain,compoundedbyglobalhealthandenergycrises.MarketstatusGlobally,77.6GWofnewwindpowercapacitywasconnectedtopowergridsin2022,bringingtotalinstalledwindcapacityto906GW,ayear-on-year(YoY)growthof9%.Theonshorewindmarketadded68.8GWworldwidelastyear,withChinacontributing52%.Additionswere5%lowerthanthepreviousyear.TheslowdowninLatinAmerica,Africa&theMiddleEastispartlyresponsibleforthedecline,buttheprimaryreasonisfallinginstallationsintheUS.Despitefinishingtheyearwithastrongfinalquarter,theUSwindindustrycommissionedonly8.6GWofonshorewindcapacityin2022,dueinparttosupplychainconstraintsandgridinterconnectionissues.ThankstorecordinstallationsinSweden,FinlandandPoland–andrecoveringinstallationsinGermany–Europeperformedwellinavolatile2022,addingarecord16.7GWofonshorewindcapacityandbringingitsmarketshareupto24%.OnshorewindadditionsinNorthAmericalastyearfellby28%whilenewadditionsinAsia-Pacific(APAC)remainedconstant,butthethreeregionscombinedstillmadeup92%ofglobalonshorewindinstallationsin2022.8.8GWofnewoffshorewindwasfedintothegridlastyear,bringingtotalglobaloffshorewindcapacityto64.3GWbytheendof2022.Newadditionswere58%lowerthanthebumperyearof2021butstillmade2022thesecondhighestyearinhistoryforoffshorewindinstallations.Chinacontinuedtoleadglobaloffshorewinddevelopment,althoughitsnewinstallationsdroppedto5GWfrom21GWin2021–arecordyeardrivenbytheendofthefeed-intariff(FiT).TwoothermarketsreportednewoffshorewindinstallationsinAPAClastyear:Taiwan(1,175MW)andJapan(84MW).Nointertidal(nearshore)windprojectsachievedcommercialoperationinVietnamin2022,duetotheceilingpricetobeusedbyVietnamElectricity(EVN)tonegotiatePPAswithinvestorsfortheirrenewableprojectsmissinguntilJanuary2023.Europeconnectedtheremaining2.5GWofcapacityin2022,withFranceandItalyeachcommissioningtheirfirstcommercialoffshorewindprojects.Despitetherateofinstallationslastyearbeingthelowestsince2016,Europe’stotaloffshorewindcapacityreached30GW,46%ofwhichisfromtheUK.Withtotalinstalledoffshorewindcapacityreaching34GWinAPAC,in2022Europerelinquisheditstitleastheworld’slargestoffshorewindmarket.Nevertheless,EuropecontinuestoleadthewaywithFengZhaoHeadofStrategyandMarketIntelligence,GWECTheData:2022wasthewindindustry’sthird-bestyearGWECGLOBALWINDREPORT20239Windin2022floatingwind.Norwaycommissioned60MWoffloatingwindcapacitylastyear,bringingtheregion’stotalinstallationsto171MW,equalto91%ofglobalinstallations.MarketoutlookTheunprecedentedtwinchallengesofensuringsecureandaffordableenergysuppliesandmeetingclimatetargetshavepropelledwindpowerdevelopmentintoanextraordinarynewphaseofeverfastergrowth.Afterachallengingyear,theglobalwindmarketisreadytobouncebackin2023,exceeding100GWforthefirsttime.Withadouble-digitgrowthrateof15%,themid-termoutlookforwindenergylooksverypositive.GWECMarketIntelligenceexpectsthat680GWofnewcapacitywillbeaddedinthenextfiveyears.Thisequalsmorethan136GWofnewinstallationsperyearuntil2027.Webelievetherearefivepillarsthatwillunderpinthislevelofsuccessinthenextfiveyears:lEurope’srenewedurgencytoreplacefossilfuelswithrenewablestoachieveenergysecurityintheaftermathoftheRussianinvasionofUkraine.lAstrongupliftforrenewableenergyintheUSoverthenexttenyears,primarilydrivenbytheInflationReductionAct(IRA).lChina’scommitmenttofurtherexpandingtheroleofrenewablesinitsenergymix,aimingforrenewableenergytocontributemorethan80%oftotalnewelectricityconsumptionbytheendofthe14thFive-YearPlan(2021-2025).lGovernmentsfullywakinguptotheopportunitiesthatoffshorewindcanprovide,makingoffshorewindtrulyglobalandincreasingambitioninmatureanddevelopingmarkets.lStronggrowthinlargeemergingmarketsbothonshoreandoffshorefromthemiddleofthisdecade.TheCAGRforonshorewindinthenextfiveyearsis12%.Expectedaverageannualinstallationsare110GW,withatotalof550GWlikelytobebuiltin2023–2027.GrowthinChina,EuropeandtheUSwillbethebackboneofglobalonshorewinddevelopmentinthenextfiveyears.Altogether,theyareexpectedtomakeupmorethan80%oftotaladditionalcapacityin2023–2027.Theglobaloffshorewindmarketisexpectedtogrowfrom8.8GWin2022to35.5GWin2027,bringingitsshareoftotalnewglobalinstallationsfromtoday’s11%to23%by2027.Intotal,130GWofoffshorewindisexpectedtobeaddedworldwidein2023-2027,withexpectedaverageannualinstallationsofnearly26GW.Beyond2027,weexpectthegrowthmomentumtocontinueasglobalcommitmentstonetzero,coupledwithgrowingenergysecurityconcerns,havealreadybroughttheurgencyofdeployingrenewablestothetopofthepoliticalagenda.Comparedwiththe2030globaloutlookreleasedalongsidelastyear’sGlobalWindReport,GWECMarketIntelligencehasincreaseditsforecastfortotalwindpowercapacityadditionsfor2023–2030by143GW(YoYgrowthof13%).Therevisedgrowthratewillonlyachieve68%ofthewindpowercapacityrequiredby2030tostayontrackforanetzero/1.5Cpathway.Nevertheless,GWECbelievesthatthemilestoneofasecondTWislikelytobepassedbeforetheendof2030–providedgovernmentsimplementnewpolicysolutionstoensurethattheglobalsupplychaincanmeetincreasingdemandfrombothestablishedandemergingmarkets–inadditiontoaddressingchallengessuchaspermittingandmarketdesign.ThetwinchallengesofsecureenergysuppliesandclimatetargetswillpropelwindpowerintoanewphaseofextraordinarygrowthGWEC.NET10PolicysummaryBymid-2023GWECanticipateswindenergytoachievethehighlysymbolicmilestoneof1TWinoperation.Andthe2TWmarkisexpectedtoarriveby2030,closingadecadeoftumultuousacceleration.Thesectorhaschangedbeyondrecognitionoverthepastfourdecades.LonggonearethedaysofwindinstallationclustersinahandfulofEuropeancountriesandafewUSstates.Windpowerhasagrowingpresenceintensofcountriesworldwide.Thesurgeofoffshorewindandinnovativetechnologiessuchasfloatingfoundationspromisetodeliverlargeamountsofwindenergyinlocationswhereitsdeploymentwouldhavebeenunimaginableuntilveryrecently.Thestakescouldhardlybehigherforwindenergyastheworldstrivestoemergefromthe‘polycrisis’ofpost-pandemicrecovery,inflationarypressures,awarinEuropeandgrowingclimateimpacts.Butallthesignspointtoasharpturnaroundthisdecade,anditisstartingnow.Asluggish2022sawonly77.6GWofadditionalwindcapacityinstalledglobally–17%lowerthanthepreviousyearbutstillthethirdhighestyearinhistoryforadditions.Offshoreadditions,at8.8GW,werelessthanhalfthe21GWclockedin2021,andyetthesecondhighestvolumeever.Despitetherelativelypositivewindinstallationnumbers,2022wastheyearwhenaperfectstormof‘racetothebottom’pricingcausedbymisguidedgovernmentpolicies,higherlogisticscostsandprojectdelaysduetoinadequatepermittingrulescreatedthebizarreparadoxofenergymarketsrewardingfossilfuelcompanieswithrecordprofits,whilerenewableenergycompaniesstruggledtobreakeven.Changehasalteredthedynamicsofthewindindustrytoo.Fromanearlyobsessionwithdemonstratingreliabilitytoanunrelentingdrivetocutcosts,thewindindustrynowneedsalaser-sharpfocusonensuringthatitcandelivertheambitiousinstallationtargetsrequiredofit.RenewableswilldominateinstallationsUnderallcrediblescenarios,renewableenergieswilldominateinstallationsoverthecomingyears.TheIEAforecaststhatnearlyalloftheadditionalelectricitygeneratedbetween2022and2025willcomefromrenewableenergysources.Alongsidesolar,windwillremainaleadingsourceofrenewablepower.By2024,GWECexpectsonshorewindtopassthe100GWannualinstallationsmark,whileoffshorewindwillinstallmorethan25GWinasingleyearforthefirsttimein2025.Installationswillacceleraterapidlyafterthat,drivenbymostcountries’ambitiousgreenenergyandclimatetargets.GWECforecaststhat680GWofwindcapacitywillbeinstalledgloballyby2027,ofwhich130GWwillbeoffshore.TheStory:thewindindustrygearsupforthecomingaccelerationGWECGLOBALWINDREPORT202311PolicysummaryAsourheatmap(seepage82)shows,therearestilltensofcountrieswherewindpowerdevelopmentisbeingheldbackbyregressivepoliciesorineffectiveprocesses.Increasingly,however,governmentsareeyeingupthevastopportunitiesthatfacilitatingthissectoropensupintermsofindustrialdevelopment,skilledjobsandsocioeconomicreturns,aswellasenvironmentalbenefits.InvestingtoboostwinddevelopmentWindenergyhasestablisheditscredentialsasoneofthemostefficienttoolsfordecarbonisingpowersystems.Failingtodeploywindfastenoughrisksincreasingcoststhroughgreaterexposuretofossilfuelvolatility,geopoliticalpressureandhighercarbonemissions.Socially,windpowerhasthepotentialtobenefitcommunitiesbycreatingmillionsofskilledjobsaroundtheworld.Economically,itcanactasacatalystfortrillionsofdollarsofinvestment.HeavyweightssuchastheUSandtheEUhaverampedupgovernmentsupportforwindenergy.TheBidenadministration’sInflationReductionAct(IRA)isalreadymobilisingmassiveinvestmentinrenewablegeneration,decarbonisedtransport,energystorageandimprovedgridconnections.InEurope,theREPowerEUprogrammeseekstoweanthecontinentoffRussiangaswhileremovingobstaclestogreenenergydeployment.AndapprovalofChina’s14thFive-YearPlan,coveringthe2021–2025period,turbochargesinnovation-drivenlow-carbondevelopment,withGWECestimatingannualwindinstallationsof60–65GWperyearforonshoreand15GWforoffshoreinthesecondhalfofthisdecade.Whilethesepoliciesareprovidingawelcomeboosttolocalindustryandpromisinglong-overdueactiontoreducesomeofthecomplexrulesassociatedwithwindenergydevelopment,theycouldalsothreatenthesector’sabilitytorisetotheaccelerationchallenge.Growingdemandforequipmentandthekeycommoditiesthatarerequiredtoproduceitwillplacesignificantpressureonsupplychains.Itisessentialthatpolicymakersapproachprocurementwithamoreholisticperspectivethatprioritiseseconomicdevelopmentandjobcreationoveranarrowfocusonachievingthelowestpossibleprice.Byadoptingthishigh-levelmindset,governmentswillallowwindpoweroriginalequipmentmanufacturers(OEMs),developers,shippingcompaniesandotheractorsinthesupplychaintoinvest,ensuringanoptimalbalancebetweensupplyanddemand,anddeliveringbenefitsforall.FacinguptothesizeofthechallengeGearinguptodeployhugevolumesofwindpowercapacityisafarfromstraightforwardtask.Adding1TWinsevenyears,whenittookaround40yearstoinstallthefirstTW,isnomeanfeat.Followingadifficultpatchofretrenchment,thewindenergymanufacturingindustryisnowfacingtheprospectofarapidupturn.Sparecapacityisverylimited,andlikelytodisappearby2026unlessurgentactionistakentoinvestinthesupplychain.OuranalysisinPart2showsthat163GWofnacelleproductioncapacityisavailableworldwide,whichislikelytomeetprojectedglobaldemandupto2027.Butthepictureislessrosyforoffshorewind.Startingin2026,Europe’sexistingoffshoreturbinenacelleassemblycapacitywillnolongerbeabletosupportgrowthoutsideofEurope,andby2030itwillhavetodoublefromcurrentlevelstomeetEuropeandemandalone.Elsewhere,nacellebottleneckslooklikelyinAsia(excludingChina)andintheAmericas,especiallyoncethepipelineofBrazilianprojectsstartsbeingrolledout.Shortagesareexpectedtoemergeinthesecondhalfofthisdecadeforkeycomponentssuchasbladesandgenerators.Gearboxmanufacturingcapacityiswellpositionedtosupportgrowthupto2027,butaconcentratedsupplychainandregionalisedsourcingstrategieslookcertaintocreatebottlenecks.ChinadominatestheglobalsupplychainforothercrucialcomponentsSparecapacityislimitedandwilllikelydisappearby2026unlessurgentinvestmentismadeinthesupplychainGWEC.NET12Policysummarysuchascastings,forgings,slewingbearings,towersandflanges,withamarketshareofmorethan70%.VesselsusedinoffshoreinstallationsareexpectedtobeinsufficientsupplyinChina,butEuropecouldseeshortagestowardstheendofthedecade,unlessinvestmentsaremadebefore2027.AndtheUS,withitsJonesActrestrictions,willcertainlystruggletomeettheBidenAdministration’stargetof30GWofoffshorewindby2030unlessitactstobuildnewvessels.Insum,bothEuropeandtheUSarefacingtheriskofsupplychainshortfallsassoonas2026,particularlyiftheyfollowthroughwithsomeofthe‘reshoring’policiesthatseveralcountriesandregionsarerollingouttostrengthenenergyresilienceandboostlocalindustry.SupplychainpressureswillaltermarketdynamicsParadoxically,justasrenewableenergyprovesitselfasthemostcost-effectiveformofenergyandtheonebestinsulatedfromthevagariesofgeopoliticalpressures,windenergyrunstheriskofseeingitsprogressthwartedbythepracticalimplicationsofuntappingitsimmensegrowthpotential.Ascountriesandregionscompeteforinvestment,thewinnerswillbethosewiththemostattractivemarketconditionsandthemosteffectiveregulation.Policymakersmusttreadthenarrowpaththatenablesanadequateleveloftradetoensuretheenergytransitionisnotdelayedwhileboostingopportunitiesfortheirdomesticsupplychains.Effortstoboostenergysecurityandstrengthenthelocaleconomyhaveledsomecountriestoreachbeyondmanufacturingtoachievelocalsupplyofcriticalinputsfortheirindustries,includingsteelproductsandrawmaterialssuchasrareearthelements(REEs).Thishasthepotentialtoseverelylimittheindustry’scapabilitytoupscale.Whenconsideringthelocalisationorreshoringoftheirenergysector,governmentshavechoices:theycanuseincentivesorpreferentialtreatmentfordomesticsuppliersorreservetheprocurementofcertaingoodsorservicesforthem.GWECadvisesagainstprescriptivelocalisationrequirementsorrestrictivetradepractices,whichcouldleadtopriceincreasesanddisruption.Itarguesinsteadforflexibilitythatcanbuildonnationalandregionalcompetitiveadvantages,givingOEMsandthesupplychainmoreflexibilityinoptimisingtheirproduction.Anincentive-basedapproachwillalsogivethewindindustrytheconfidencetoovercomerecentchallengesandbegintoscaleupforthenextphaseofglobalgrowth.Thescaleoftheinvestmentandproductionneededtoachievetheenergytransitionwillrequirecontinuedglobalandregionalcollaborationandthescalingupofinvestmenteverywhere.Policymakersmustcometogethertodesignmechanismsthatmaketherelevantinputsfortheenergytransitionfreelyavailablearoundtheworld.Policymakershavethepowertoavoidthecripplingbottlenecksthatarelikelytoariseifsupplychainsdonotrisetothechallengeofthegrowingdemandforequipment.Buttheymustensuretheyengageinearlyandopendialoguewithindustrytoensurethatpolicygoalsandindustryactionarealigned.Ifdesignedproperlyandcomprehensively,policiesdesignedtoenablethescalingupofthesupplychainanditsdiversificationrepresentahugeopportunityfortheworld.Forthewindindustrytomeettheexpectationsofpolicymakersandsocietyatlarge,itisessentialthatinvestmentstartsrightnowinnewindustrialcapacity,andintrainingandskills.Intheabsenceofsuchimpetus,theindustryrunstheriskoffallingshortofwhatisrequiredtodeliverthenecessarycapacity,leadingpolicymakerstoturntolessefficientalternatives,andultimatelycausingsocietytomissitsclimatetargets.WINDENERGY:THECOMINGACCELERATIONGWEC.NET14ThecomingrenewablesaccelerationTheprolongedperiodofhighenergypricestheworldexperiencedintheaftermathoftheCOVID-19pandemic,sharplyexacerbatedbytheRussianinvasionofUkraine,hasexposedthefactthatwearesufferingadeepenergycrisis.Thisisaconsequenceofapatchyanddelayedenergytransition,whichhasleftenergymarketsvulnerabletovolatilefossilfuelsupply–muchofwhichisdrivenbypoliticalagendasandanti-competitivepractices.Aswellasexposingconsumersandindustrytohighenergyprices,thecrisishasbeenasignificantcontributortothereturnofinflationasthemajorchallengefortheworld’seconomy.Meanwhile,theimpactsofacceleratedglobalheatingarebecomingevercleareratthesametimeascountriescontinuetodelaytakingtheactionsneededtoachievetheemissionstrajectoryoutlinedintheParisAgreement.However,thecurrent‘polycrisis’hasnotgoneunansweredbysocietyingeneralandpolicymakersinparticular.Thedrivetowardsloweringemissionsandprioritisingsustainabilitycontinuestogathermomentum.Thepastyearhasseengovernmentsaroundtheworldtakeunprecedentedstepstospeeduptheenergytransitionandweantheireconomiesofftheirdependenceonfossilfuels.WhetherthroughtheInflationReductionActintheUS,theREPowerEUprogramintheEUorenhancednationalplans,thepolicyenvironmenthasevolvedquicklyoverthepast12months.Thisinturnhasledtocountriesandregionssettingnew,highlyambitioustargetsforrenewableenergyandforthephaseoutoffossil-basedtechnologiesingeneration,transportandindustry.Theleadingintergovernmentalenergyagenciesagreethatrenewableenergy–andthetwoleadingtechnologiesofwindandsolarespecially–willdominateelectricitydemandgrowthinthecomingperiod.AccordingtotheInternationalEnergyAgency,renewableenergywillprovide98%ofthe2,518TWhofelectricitygenerationtobeaddedbetween2022and2025.1GWECexpects680GWofwindcapacitytobeaddedgloballybetween2023and2027,ofwhich130GWwillbeoffshore.OnshorewindinChinawillcontinuetoleadinstallationswith300GW,followedbyEuropewithnearly100GW.Offshorewindwillplayanincreasinglylargerolewithprojectedglobaladditionsofmorethan60GWbetween2023and2025,and68GWin2026–2027.Windenergyisexpectedtoachievethemilestoneof1TWofinstalledcapacitybythemiddleofthisyear.Inarecentreport,BloombergNEF(BNEF)forecastthat,havingtaken33yearstoreach1TW,windwilldeliverclosetoanotherTWby2030.2Thecomingrenewablesacceleration1.https://www.iea.org/reports/electricity-market-report-20232.https://about.bnef.com/new-energy-outlook/OnshoreOffshore362024e20222023e2026e2027e2025e781151251351501573218261891221171091069769CAGR15%Newinstallationsoutlook2022–2026(GW)Source:GWEC,2023GWECGLOBALWINDREPORT202315ThecomingrenewablesaccelerationAnewgeopoliticaleraPoliticalconditionsthathavemadewinddeploymentdifficultinmanycountriesarebeginningtoshift,asourheatmapillustrates.Thereareonlyafewplacesnowwherewindpowerisneitherinexistencenorplanned.UndertheleadershipofPresidentLuisInácio‘Lula’daSilva,Brazilislookingatwindenergyasavehicleforachievingclimategoalswhileboostingeconomicgrowth.Asitcontinuestomoveawayfromregulatedauctionsandtowardscorporatepowerpurchaseagreements,theBrazilianwindenergysectorgainsresilienceandpreparesforaverybrightfuture.Ontheothersideoftheglobe,Indiaistargetingwindcapacityadditionsofmorethan60GWonshoreandnearly40GWoffshoreby2030.Itisalsolookingtoseizesupplychainopportunities,particularlybycapitalisingontheroleofmicro,smallandmediumenterprises(MSMEs)intheIndianwindmanufacturingsector.Afteraspellofvirulentanti-windrhetoricundertheTrumpadministration–albeitwithcontinuedeconomics-ledgrowthofthesector–PresidentBidenhasenactedadramaticchangeofdirection,boththroughrestatingtheUSA’sclimateleadershipininternationalforums,andthroughtheInflationReductionAct(IRA).Thislandmarkpieceoflegislationoffersfunding,programmesandincentivesforacceleratingthetransitiontoacleanenergyeconomyacrossmultiplesectors.Theprospectsforoffshorewind,inparticular,areveryexciting.TheEU,foritspart,islayingoutamulti-prongedapproachtoboostEuropeanindustrywhileachievingenergyandclimategoals.Renewableenergyprojectscouldbegivenprioritypermittinginspecial‘go-to’areasundernewprovisionsbeingconsideredintheupcomingrevisiontotheRenewableEnergyDirective,whiletheREPowerEUpackageoffersrenewablesa20billionEURfundingpot.India●Annualtargetof8GWonshorewindtendereveryyearbetween2023and2030basedonasingle-stagetwo-envelopebidsystem.●MNREpublishedastrategypaperoutliningatendertrajectoryof37GWofoffshorewindby2030●IndiangovernmentandindustryseizingsupplychainopportunitiesEgypt●42%renewableenergyby2035withsupportofGreenCorridorInitiative●Installationsprojectedtorisefrom1.7GWto8GWby2030●Multi-GWscaleprojectsinearlystagesofdevelopmentChina●50GWofplannedinstallationsduringthe14thFive-YearPeriod(2021–2025)●Projectedannualinstallationsof70–80GWuntil2030●Localindustryreadytosupportannualinstallationsofapproximately15GWAustralia●Newnationalgovernmentsupportiveofonshoreandoffshorewinddevelopment●OffshoreElectricityInfrastructureRegulationsreleased●AnnouncedareasforoffshorewindinGippsland(Victoria)Brazil●Cross-partysupportforwindenergyasadriverofeconomicgrowthandjobcreation●ABEEólicaexpectsannualadditionsintheregionof3GWforonshorewindoverthenextdecade●OffshorewindandgreenhydrogenexpectedasadditionaldriversforwindenergydevelopmentSouthKorea●Windenergytargetincreasefrom2to34%,aspartofa30%renewablestargetby2036●Projected34GWofinstalledwindenergyby2036●Newgovernmentimplementinga'OneStopShopBill'tofast-trackprojectdevelopmentStronginstalledcapacityincrease,newambitioustargetsand/orpolicyimprovementAdequatetargetsandpolicies,butnotmatchedbyexpectedprogressLackofprogressorregressionTunisiaOffshorewindby205030GW60GW300GW17GW28GW9GW15GWWindenergyby2030Victoria-offshorewindby2040NofederaltargetsWindenergyby203045%Windenergyby20305%Offshorewindover2026–2035(1.5GW/yr)10GWOffshorewindtargetsof10GWby2030and30–45GWby2040Renewableenergyby2030Offshorewindby2030Offshorewindby2030100%Renewablepowerby2030100%Renewablepowerby2030MongoliaAustraliaIndonesiaThailandIndiaChinaKazakhstanUzbekistanSaudiArabiaEgyptAlgeriaMauritaniaBrazilArgentinaChilePeruColombiaCostaRicaMexicoUnitedStatesCanadaNigeriaMoroccoEUUKSenegalSouthAfricaEthiopiaKenyaTanzaniaVietnamPhilippinesTaiwanSouthKoreaJapanUruguayGhanaNambiaMozambiquePolicyheatmapGWEC.NET16ThecomingrenewablesaccelerationAdditionally,theEUislookingtointroducelegislationthatwouldsimplifyandfast-trackpermittingproceduresforclimate-neutralindustrialinfrastructure,withthegoalofboostingEurope’skeygreenindustriesandtheirfullvaluechains.Effortsarealsobeingmadetoreducedependenceonnon-EUsourcesofrawmaterialsandrareearthelements(REEs).RespondingtoburgeoningdemandDemandforwindenergycontinuestogrowandexpand.Thetrendtowardscorporatepowerpurchaseagreementsshowsnosignofslowingdown,andlargecompaniesfromoutsidetheenergyindustryareincreasinglykeentoinvestinwinddevelopment.BloombergNEFestimatesthatoffshorewindfinancingactivitywillhitnewrecordsin20233,withmorethan30GWofnewprojectsgettingthego-ahead,overhalfofwhichwillbeoutsideChina.Floatingoffshoretechnologyismakingsteadyprogressandwillopenuppreviouslyuntappedmarkets.However,thepromiseofmassiveexpansionriskscollidingwiththerealityofdeliveringturbinesonlandandinthewater.Theindustryisemergingfromseveraldifficultyears,duringwhichturbinemanufacturershavesufferedfinanciallossesandpolicymakershaveoftenfailedtoprovidetheoptimalconditionsforfastandefficientmarketdevelopmentandthenecessarygridbuildout.Whiletechnologicaladvancesarehappeningacrossthesector–fromChina’scontinuedleadinupsizingturbinecomponents,toglobaleffortstoimprovethecircularityoftraditionallydifficult-to-recycleepoxy-basedturbineblades4–thereisadangerthatanindustryscarredbyyearsoffinanciallossesmayretreatintocautionandprotectionism.Thiswouldbetheworstpossiblescenariobothforthewindindustryandtheenergytransition–asglobalsupplydiversificationhassupportedthereductionofwind’sLCOE.Asgigawatt-levelprojectskickoffinnewandtraditionalwindmarketsacrosstheglobe,GWECanticipatesaflurryofordersforturbinemanufacturerseverywhere,andpressureonallelementsofthesupplychainasaresult.Itisessentialthattheindustrygearsuptorespondtothischallengebythinkingstrategicallyabouttheroadaheadandsettingitselfuptodeliveronitsambition,supportedbyadequatepolicies.AturningpointforwindHavingachievedimpressivelearningsandeconomiesofscaleoverthepasttwodecades,windisnowamaturesectorwhich,likemoretraditionalenergysources,reactstoexternalfactorssuchascommodityprices,interestratesandpoliticalsupport–ratherthanitsowninternaldynamics.Nolongerthenewkidontheenergyblock,thewindsectorisataturningpoint–facinguptoahostofnewchallengeswhilelookingtodeploymassiveamountsofadditionalcapacityinanever-growingnumberofcountries.Suchahugeriseinwindpowerdevelopmentcanonlymaterialiseifgovernmentsplaytheirpart,throughsupportiveandstablemarketconditions,inallowingthewindindustrytoscaleuptotheambitioustargetsitisexpectedtodeliver.Inanincreasinglyinterconnectedworld,thewindsectormustprovethatitcancontinuetoinnovate,collaborateandintegrate.Fromtheroleofwomenandminoritiesintheindustrytothewide-rangingchallengeofsustainability,GWECisdeterminedtofacilitateconnectionsbetweenthemanystakeholdersthesectoraffects.Havinglongestablisheditscredentialsasareliable,effective,efficientandcost-competitivetechnology,thewindindustrynowneedstherightconditionstostepuptothelevelthatisrequiredofittofullydeliveronitspromiseofcleanerandcheaperenergyforall.3.https://about.bnef.com/new-energy-outlook/4.https://www.vestas.com/en/media/company-news/2023/vestas-unveils-circularity-solution-to-end-landfill-for-c3710818PART1:ANEWENERGYMARKETGWEC.NET18Part1:AnewenergymarketIn2022,theworldsawmanyofitslong-establishedparadigmsshatteredbyanumberofdeeplytransformativeevents.Inflationreachedlevelsnotseensincethemassivedisruptionsofthe1970s–drivenatbothtimesinlargepartbycommoditypriceincreases.TheunprovokedattackonUkrainebyRussialaidbaretheworld’sdependenceonfossilfuels–andtheenergyinsecuritythatcomeswithit.AsRussiaistheworld’ssecondlargestgasproducer,thisdependencecameatasteeppriceforgas-importingcountries,causingsurgesinthepricesofeverything–fromfertiliserstoheatingandpower–andcausinglow-incomecountriestosufferthemost.Theglobalresponsehasbeentofocusonenergysecurityandresilience.Governmentsintroducedmeasurestomakeenergyaffordablebyutilisingallavailableenergysources,includingcoal,gasandnuclear,andbycommittingtodevelopingmorerenewablesinthelatterpartofthedecade.Theshort-termfocusonaffordabilityandthesubsequentincreaseduseoffossilfuelsledtoanincreaseinglobalcarbonemissions1,evenwithnearly80GWofwindpowerandmorethan200GWofsolarcapacityinstalled2.Whatthistellsusisthatinstalling300GWofrenewablesinoneyearisnotenoughtocurbariseincarbonemissions.AtippingpointforwindenergyAmidtheturmoilof2022,itisclearthatwehavereachedatippingpointforrenewableenergyingeneralandforwindpowerinparticular.InEurope,theREPowerEU3programmehascommittedthebloctoweaningthecontinentoffRussiangasby2030(orsooner).Thepolicyalsoseekstoremovebottleneckstopermittingandotherhindrancestothedeploymentofrenewableenergyprojects.TheUSpassedtheInflationReductionAct(IRA)4,transformingthewaythecountryapproachesrenewables,decarbonisedtransport,energystorage,theelectricitygridandenergyefficiency.Theacthasalreadyacceleratedlargeamountsofinvestment.ApprovalofChina’s14thFive-YearPlan5,coveringthe2021–2025period,pavesthewayforinnovation-driven,sustainableandlow-carbondevelopment.TheplanalsoaimstoreducethecarbonintensityoftheChineseeconomyandtargetspeakCO2emissionsbefore2030.Anewenergymarket202128,00028,50029,00029,50030,00030,50031,00031,50020252022CoalOilGasNuclearRenewablesProjectedchangesinglobalelectricitygeneration(TWh)bysourceSource:IEA,20231.https://www.carbonbrief.org/analysis-global-co2-emissions-from-fossil-fuels-hit-record-high-in-2022/2.https://renewablesnow.com/news/global-solar-pv-additions-to-top-200-gw-in-2022-ihs-markit-761554/3.https://ec.europa.eu/commission/presscorner/detail/en/IP_22_15114.https://www.epa.gov/green-power-markets/inflation-reduction-act5.https://www.adb.org/publications/14th-five-year-plan-high-quality-development-prcGWECGLOBALWINDREPORT202319Part1:AnewenergymarketSignificantlymorewindwillberequiredtoachievethosegoals.Substantiatingthistrend,theInternationalEnergyAgency(IEA)’sElectricityMarketReport2023seesrenewableenergysourcessupplyingprettymuchthetotalityoftheadditionalelectricitygeneratedbetween2022and2025.6InitsRenewables2022report–theagency’sprimaryanalysisoftherenewableenergysector–theIEAforecastscapacityadditionsreachingrecordhighsthrough20277,ledbysolarandwind.Itexpectsannualadditionstorangefrom350GWinthemainscenarioto400GWintheacceleratedcase.Whatdoesawindenergyboommean?Windpowerisnotjustgrowingbigger,itisalsospreadingmorewidely.Beyondthecurrentworldleaders,manyothercountriesarealsorefocusingonrenewables–drivenbothbytheinsecurityofrelyingonfossilfuelsandthedesiretoremaineconomicallycompetitive.Economicdriversarebecomingincreasinglyimportantascompaniesgloballycommittoenvironmental,socialandgovernance(ESG)goalsthatrequirethemandtheirsupplierstodecarbonise.Thisisamega-trendtowatchasGWECbelievesthedemandsidewillbecomemuchmorevocalinitsdesiretoseemorerenewablescomeonlinetohelpthemandtheirsuppliersmeettheirdecarbonisationtargets.AnexampleofthisistheAsiaCleanEnergyCoalition8–launchedbyGWEC,theWorldResourcesInstituteandTheClimateGroupandincludingGoogle,Apple,Samsung,Nikeandmanyotherlargecorporateswithsignificantcommitmentstodecarbonise.Butwhilethesetrendsandcommitmentsareverypositiveforrenewablesingeneralandwindenergyinparticular,thereremainsmuchtodotofullyenabletherenewablessectortodelivertheambitiousdeploymentlevelsrequiredtoachievethesewiderESGgoals.Take,forexample,thesupplyofwindturbines.Basedonthe050100150200250300202120222020201920182017201620092008200720062005200320042015201420132012201120102016=100CommodityPriceIndex01234567202120222020201920182017201620092008200720062005200320022004201520142013201220112010HistoricalLondonInterbankOfferedRate(LIBOR,%)6.https://www.iea.org/reports/electricity-market-report-20237.https://www.iea.org/reports/renewables-20228.https://gwec.net/acec-launches-to-rapidly-drive-corporate-clean-energy-procurement-in-asia/Source:IMF,2023Source:IMF,2023GWEC.NET20Part1:AnewenergymarketGWECMarketIntelligencedatabaseofglobalwindsupplyside,theindustryhadapotentialturbineproductioncapabilityof120GWin2020.Since105GWofturbinesweredeliveredin2021,thatleavesapproximately10%ofsparecapacity.However,becauseoflowprofitabilityin2021and2022,manyturbinemanufacturershavecutbackonstaffandclosedsomeproductionfacilities.Astheindustrystartstogrowagain,willturbinemanufacturershaveenoughvisibilityonturbinedemandtorapidlyrampupproductioncapacity?AnothersignificantrecenttrendisthegrowingChina–US/EUtensionontradeandotherpolicies,possiblymarkingamoveawayfromglobalisationinanattempttoshoreupregionaleconomiesandsecurityofsupply.Whataretheimplicationsforwindenergy,especiallywithChinabeingsuchadominantproduceracrosstherenewablessupplychain?Thesearesomeofthequestionswewilllooktoaddressindetailinlaterchaptersofthisreport.Atthehighlevel,itseemsinevitablethatasignificant,globalrampingupofproductioncapacitywillbeneededtomeetfast-growingdemand.AllenergycostsareontheupFollowingthemassivedisruptionstosupplychainscausedbytheCOVID-19pandemic,energydemandbouncedbackaseconomiesreopened.Stretchedsupplychainstriedtobalancesupplywithdemand,whileshippingandlogisticsbottlenecksaddedtothestrain.Pricesforarangeofgoods,fromcarsandwindturbinestowashingmachinesandfood,rosedramatically.Meanwhile,asinflationsoared,centralbanksbecameconcernedaboutitsimpactsontheeconomyandembarkedonaseriesofinterestraterises,leadingthecostofcapitaltoalsoincrease.Highercostofcapitalleadstoincreasedcostsforallinvestments.Thehistoricallyhighcommoditypricesseeninthelasttwoyears,andtheupturninthecostofcapitalseenin2022ascentralbankstightenedmonetarypolicy,hasimpactedallenergysourcesworldwide.From2010to2020,Newcastlecoalfutures,thebenchmarkforthetop01020304050602021202220202019201820172016201520142013LNGspotpricesinAsia(USD/mmbtu)0Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4200201920202021202220232024400Indexedelectrictyprice(Q12019-=100)60080010001200EuropeanindexIndiaNordicsAustraliaJapanUnitedStatesSpainUnitedKingdomFranceGermanyAveragequarterlywholesaleelectricitypricesSource:IEA,2023Source:FederalReserve,2023GWECGLOBALWINDREPORT202321Part1:Anewenergymarketcoal-consumingregionofAsia,rangedbetween$50/tonneand$120/tonne9.Aftersharpincreasesin2021,theyaveraged$350/tonnein2022,makingthecostofcoal-firedpowergenerationsubstantiallyhigherthanthecostofwindinalmosteverycountry.Andthatisbeforethecostofcarbonoritsabatementiseventakenintoaccount.Overthepasttwoyears,pricesforAsianliquifiednaturalgas(LNG)havespikedagainst2020levels.WhilemostLNG-importingcountrieshavelong-termcontractsinplace,theyareunlikelytocover100%ofdemand,leavingcountriesexposedtoimportingspotcargoes.Thishascomeataveryhighfinancialcost,particularlyinthepastyear.AndbecauseLNGmarketsareglobalthepriceimpactsarefeltglobally.Thesetrendscontributedtoahistoricincreaseinwholesaleelectricityprices.Averagequarterlywholesaleelectricitypricesspikedinmuchoftheworldthroughtheendoflastyear,andwhiletheIEAprojectspricestodropin2023,theprojectionsarenotclosetowheretheyhavebeeninpreviousyears.Equipmentmanufacturingforgas-firedandcoal-firedgeneration–asforwindandsolargeneration–hasbenefitedfromtheefficiencyimprovementsachievedoverthedecades.Butwithhighinflationandmassivedisruptionstoglobalsupplychains,coupledwithhigherexpenditureinshippingandlogistics,thecapitalcost(CAPEX)ofelectricitygenerationforalltechnologieshasrisen.Windhasachievedsignificantcostreductionsoverthelast20yearsandthewindindustryisnowconsideredfairlymature,especiallyonshorewind.Offshorewindisnewerbut,havingbeencommercialforatleast15years,itisalsoreachingmaturity.Thismeansthatthedramaticpricereductionsthatwehaveseenhistoricallyarelikelytoslowandfuturecostfluctuationsinthecostofwindarelikelytoreflecttheunderlyingcostofcapital,commoditycosts(steel,copper),andlogisticscosts,asnotedabove.Forexample,thecostperkilowatt(kW)foragas-firedturbine,amaturetechnology,hasbeenroughly1,000USD/kWforthelast20years(+/-30%)withthevariationcausedbytheusualmovementsinsupplyanddemand,andparticularlybythecostofmaterialssuchassteelandcopper.10Thereisnoreasontothinkthatwind,asitmatures,willactdifferently.RelativecostsofwindpowerremainlowThecostprofileofelectricitygeneratedfromwindandsolarenergyversuselectricitygenerationpoweredbytraditionalfossilfuelsappearsveryfavourable–ithasbeenforsometimeandwillcontinuetobe.050100150200250201420152016201720182019202020212022CoalUSCCGTUKCCGTJapanWindonshoreUKWindoffshoreUKWindonshoreUSPhilippinescoalJapancoalHistoricalLCOEbytechnology(USD/MWh)9.https://tradingeconomics.com/commodity/coal10.https://www.sciencedirect.com/science/article/abs/pii/S1364032117305531?via%3DihubSource:BNEF,2023GWEC.NET22Part1:AnewenergymarketWindpowerstillmaintainspriceadvantagesinmostcountries,evenwithoutconsideringtheimpactsorfuturecarbonpricingschemes.ThereisnoreasonwhywindpowershouldloseitspriceadvantageoverLNGandcoalinmostmarketsglobally.Tomakewindpowerascost-efficientaspossiblegoingforward,itisessentialthatgovernmentscontinuetoprovidevisibilityonfuturedemandthroughambitiousnationallydeterminedcontributionsandsectoraltargetswhileintroducingenablingregulationsandremovingbottlenecksinpermittingandotherphasesofdevelopment.FromcosttovalueAtthesametime,toachievetheirambitions,countrieswillalsohavetomovedecisivelytofixcurrentmarketandregulatoryimbalances,whichhaveseenleadingcompaniesinthewindindustrysupplychaindeclarelossesoveraperiodofseveralyearswhilefossilfuel-producingcompaniesmakerecordprofits.Thissituation,referredtobyleadingcommentatorsintheenergysectorasa‘bizarreparadox’,hasbeen‘acolossalmarketfailure’,accordingtoGWECCEOBenBackwell.11Poormarketdesignandprocurementhaveledtoa‘racetothebottom’onwindpricing,whileinflationarypressurescombinedwithgovernmentpricecapshaveexacerbatedthesqueezeonprofitability.Asweshallsee,thisinturnhasledtounderinvestmentinmanufacturingandhascreatedthelikelihoodofsupplychainbottlenecksintheyearstocome.Inordertoenablethehugeamountsofsupplychaininvestmentneededtomeetincreaseddemand,governmentsandregulatorswillneedtoactsmartlytofixcurrentmarketimbalancesandsetthestageforgrowth.Whilethefocusoverthelasttwodecadesormorehasbeenonachievingcostreductions,withprocurementarrangementslargelyledbyconcernsfromtreasurydepartments,policymakingnowneedstofocusonthesocietalandeconomicvalueofwindenergy.Windenergyisalreadyhighlycompetitivecomparedwithfossilfuelsandnuclear,butitswidersocialvalueneedstoberecognisedinmarketandprocurementframeworks.Windenergy,incombinationwithotherrenewableenergytechnologies,isthemostefficientwayofdecarbonisingpowersystems.Theevidenceshowsthatafailuretodeploywindrapidlyenoughcarrieswithitfarhighercostsintermsofexposuretofossilfuelvolatility,geopoliticalpressureandhighercarbonemissionsleadingtodamagefromclimatechange.Windenergyhasthepotentialtocreatetensofmillionsofnewskilledjobsaroundtheworldandactasacatalystfortrillionsofdollarsofinvestment.Itisessentialthatpolicymakersmovethediscussionaroundprocurementawayfromanarrowfocusonachievingthelowestpricepossible,toonearoundhowtheycanachievethemaximumamountofeconomicdevelopmentandjobcreation,whilemovingrapidlytofulfiltheiremissionreductiontargets.GWECanditsmembercompanies,alongsidesisterorganisationsandpartnerslikeIRENAandtheIEA,areworkinghardtoachievethenecessarychangeinfocusandcreateimprovedmarketandregulatoryconditionsforarapidandconfidenttransition.Thiswillallowwindoriginalequipmentmanufacturers(OEMs),developers,shippingcompaniesandotheractorsinthesupplychaintoinvest,ensuringanoptimalbalancebetweensupplyanddemand,anddeliveringbenefitsforall.Inlatersectionsofthisreport,welookathowpolicydiscussionisshiftinginkeymarketsfortherenewablestransition.Butfirstweexaminethecurrentstateoftheglobalwindsupplychainanddiscussthepotentialimpactofpoliciesaimedatachievingalargershareofnationalandregionalcontentinwindturbinemanufacturing.11.WindPower’s‘ColossalMarketFailure’ThreatensClimateFightPART2:CHALLENGESINTHESUPPLYCHAINGWEC.NET24Part2:ChallengesinthesupplychainWhile2022sawonly78GWofnewcapacityconnectedworldwide,themarketisreadytobouncebackin2023,primarilydrivenbyexpectedexplosivegrowthinChina.Cumulatively,nearly940GWofwindpowerhadbeeninstalledglobally(withouttakingintoaccountgridconnection)bytheendof2022.GWECMarketIntelligenceforecaststhatthe1TWmilestonewillbereachedsometimemid-2023.Whatistheexpecteddemandinthisdecade?Comparedwiththe2030globaloutlookreleasedalongsidelastyear’sGlobalWindReport,GWECMarketIntelligencehasincreaseditsforecastfortotalwindpowercapacityadditionsfor2023–2030by143GW(13%YoY).Themainreasonsbehindthisupgradeinclude:lEnergysystemreforminEurope,replacingfossilfuelswithrenewablestoachieveenergysecurityintheaftermathofRussia’sinvasionofUkraine;lChina’scommitmenttofurtherexpandtheroleofrenewablesinitsenergymix;lAnanticipatedten-yearinstallationupliftintheUS,drivenbythepassageoftheIRA.AlthoughtherevisedrateofwindgrowthisstillnotrapidenoughtoenabletheworldtoachieveitsParisAgreementtargetsornetzeroby2050,GWECbelievesthemilestoneofasecondTWislikelytobepassedbeforetheendof2030–providedtheanticipatedgrowthmaterialisesinthethreekeywindmarketsofChina,EuropeandtheUS.Whatisthestateoftheglobalwindsupplychain?Asthebirthplaceofthewindindustry,Europeenjoysamaturesupplychainspanningfromturbinenacellesthroughtokeycomponentsandrawmaterials.However,sinceestablishingalocalwindsupplychainin2008–2010,Chinahasnotonlybecometheworld’sleadingwindturbinemanufacturingbase,butalsothelargestproductionhubforkeycomponentsandrawmaterials.Challengesinthesupplychain202020212022202320242025Installationsneedtogrow5xOrwereachonly68%ofthewindpowerrequiredby2030tostayontrackforanet-zero/1.5Cpathway20262027202820292030NewwindcapacityNewglobalinstallations(GW)Cumulativeglobalinstallations(GW)ProjectednewwindcapacitybasedoncurrentgrowthratesAnnualcapacitygaptomeetnetzeroby2050scenariosCumulatedwindcapacitytomeetnetzeroby2050scenarios0509594781151251351501571691801902TW1TW10015020025030035040004008001,2001,6002,0002,4002,8003,200The2TWmilestoneisexpectedtobeachievedinjustsevenyears15423World’stopfivewindturbineandcomponentproductionhubsbyannualoutputSource:GWECMarketIntelligence,February2023Source:GWECMarketIntelligence;IEANetZeroby2050Roadmap(2021);projectednewwindcapacityfrom2023-2030assumesa~7.2%CAGR,whichisbasedonGWEC’sQ12023GlobalOutlook;capacitygapfiguresareestimationsbasedontheIEARoadmapmilestonefor2030.CumulativeglobalinstallationsforwindenergyareroughlyinalignmentwiththeIRENAWorldEnergyTransitionsOutlook:1.5°CPathway(2021).Thisdatarepresentsnewandcumulativecapacityanddoesnotaccountfordecommissionedprojects.GWECGLOBALWINDREPORT202325Part2:ChallengesinthesupplychainEuropeanandAmericanturbineOEMsdecidedtodiversifytheirsupplychaintoensuresecurityofsupply,intheaftermathoftheCOVID-19pandemic.India,thesecond-largestAsia-Pacific(APAC)hubforturbineassemblyandkeycomponentsproduction,hassincegainedanincreasinglyprominentroleintheglobalwindsupplychain.WhilemostofthesupplierstothewindindustryarestillbasedinAPAC,EuropeandtheAmericas,newentrantshavealsoemergedintheMiddleEastandNorthAfrica(MENA)region.Willtherebeenoughsupplychaincapacitytofeedgrowth?TurbinenacellesGlobally,thereare153turbineassemblyplantscurrentlyinoperation,withanother74facilitieseitherunderconstructionorintheplanningstage.Chinahasmorethan100nacelleassemblyfacilitiesinoperationandanother64underconstruction.Withaturbinenacelleproductioncapacityof98GWperyear,thecountryaccountsfor60%oftheglobalmarketshare,makingitbyfartheworld’sdominantturbinenacellemanufacturinghub.Europeistheworld’ssecond-largestturbinenacelleproductionbase,withassemblyfacilitiesmainlylocatedinGermany,Denmark,Spain,France,PortugalandTurkey.TheUSistheworld’sthird-largestwindnacellemanufacturinghub,followedbyIndiaandLATAM–primarilyBrazil.Globally,163GWofnacelleproductioncapacityisavailablein2023.Atfirstglance,thewindindustryappearstohaveenoughnacelleassemblycapacitytomeettheprojectedglobaldemandupto2027.However,thepictureisdifferentifseparatebenchmarksareappliedforonshoreandoffshorewind,especiallyataChina(incl.capacityfromthreewesternturbineOEMs)60%Europe19%US9%India7%LATAM4%Other(APACexcl.ChinaandIndia)1%163GWGlobalwindturbinemanufacturingcapacityin2023OverviewofglobalwindturbinenacellefacilitiesChinaEuropeIndiaUSALATAMAsiaPacificAfrica&METotalTotalnumberofnacelleassemblyfacilities(onshore)77(4)16134631123Totalnumberofnacelleassemblyfacilities(offshore)20(1)50004030Numberofannouncednacelleassemblyfacilities(onshore)1702000019Numberofannouncednacelleassemblyfacilities(offshore)4710304055facilitiesownedbywesternturbineOEMsNote:Windturbinemanufacturingcapacityreferstowindturbinenacelleassemblycapabilityanddoesn’trepresentactualnacelleproductionin2023.Source:GWECMarketIntelligence,February2023GWEC.NET26Part2:Challengesinthesupplychainregionallevel.ChallengesinthesupplychainforonshorewindnacellesChinadominatesglobalonshorewindturbinenacelleassemblywith82GWofidentifiedannualcapacity.Outofthistotal,12GWisfromthethreewesternOEMs:Vestas,SGREandGERenewableEnergy.With21.6GWofannualassemblycapacityperannum,Europeistheworld’ssecondlargestonshoreturbinenacelleproductionbase,followedbytheUS(13.6GW),India(11.5GW)andLATAM(6.2GW).Whenwecomparetheseproductioncapacitieswiththeonshorewinddemandprojectedforthisdecade,weconcludethatthesupplychaininChina,IndiaandLATAMwillhaveenoughnacelleproductioncapacitytoaccommodatedemand,whiletherestofworld,inabusinessasusualscenario,willcontinuetoOnshoreturbinenacellecapacityinChina,202382,000MWOnshoreturbinenacellecapacityinIndia,202311,500MWOnshoreturbinenacellecapacityexcl.China&India,2023RoW1%(350)LATAM15%(6,150)Europe52%(21,600)ChineseturbineOEMs85%(70,000)ChineseturbineOEMs11%(1,200)IndianturbineOEMs39%(4,500)WesternturbineOEMs15%(12,000)WesternturbineOEMs50%(5,800)NorthAmerica32%(13,650)41,750MWOnshorewinddemandandsupplybenchmark,2023–2030(MW)Demandvssupplyanalysis2023-2030(MW)2023e2024e2025e2026e2027e2028e2029e2030eEurope1450017750189202095023290235002400025000US80009000100001300015000170001800020000LATAM58605362520050505030500050005000China6000060000600006000060000650006500065000India34004200450047004500450050005000RoW56199955104241356013705140001430015000Global97379106267109044117260121525129000131300135000lSufficientlPotentialbottleneckSource:GWECMarketIntelligence,March2023Source:GWECMarketIntelligence,February2023GWECGLOBALWINDREPORT202327relyonimportedwindturbinestocopewiththeanticipatedgrowth.ForEuropeandtheUS,weexpectsufficientsupplythroughoutthisdecadeifwesternturbineOEMscansmoothlymobilisethecapacitytheyowninChinaandIndia.However,ifthefreeflowoftheglobalwindsupplychainisinterruptedbyproposedregionalinitiativessuchas‘MadeinEurope’and‘MadeintheUSA’–andnonewnacelleassemblycapacityisbuiltatthesametime–weexpecttoseesupplychainconstraintsinbothregionsbythemiddleofthisdecade.EvenassumingthatalloftheexistingnacelleproductioncapacityinEuropeandtheUScanbefullyutilised–anunlikelyoccurrenceasbufferroomisnormallyrequiredtoensuresuffcientsupplyandproductioncapacitywillbeimpactedbytheintroductionofnewonshoreturbineswithgreaterpowerrating–weforeseeabottleneckoccurringfrom2026.ChallengesinthesupplychainforoffshorewindnacellesComparedwithonshorewind,thesupplychainforoffshorewindturbinesismoreconcentrated,duetothefactthatmorethan99%oftotalglobaloffshorewindinstallationispresentlylocatedinEuropeandtheAPACregion.Expectedoffshoreturbinenacellecapacityexcl.China,202415,200MWOffshoreturbinenacellecapacityinChina,202316,000MWOffshoreturbinenacellecapacityexcl.China,2023NorthAmerica0%Europe83%(9,500)Europe76%(11,500)China(CNOEMs)94%(15,000)APACexcl.China17%(1,900)NorthAmerica0%11,400MWAPACexcl.China24%(3,700)China(nonCNOEMs)6%(1,000)Offshorewinddemandandsupplybenchmark,2023–2030(MW)Demandvssupplyanalysis2023-2030(MW)2023e2024e2025e2026e2027e2028e2029e2030eEurope5760295570021003612143154032144025950China1000012000120001500015000150001500015000APACexcl.China17511569288426153855477069007900NorthAmerica5351660378047504460450045005000LATAM0000005001000Global1804618184256663240135458396734834054850lSufficientlPotentialbottleneckSource:GWECMarketIntelligence,March2023Source:GWECMarketIntelligence,February2023Part2:ChallengesinthesupplychainGWEC.NET28Part2:ChallengesinthesupplychainChinaistheworld’snumber-oneoffshoreturbinenacelleproductioncentrewithannualassemblycapacityofupto16GW,ofwhich1GWisownedbyonewesternturbineOEM.ExcludingChina,theAPACregionhasanoffshoreturbinenacellecapacityof1.9GW,mainlylocatedinTaiwanandSouthKorea.InEurope,currentnacelleassemblycapacityforoffshorewindisabout9.5GW,whichweanticipatereaching11.5GWnextyearwhenanewnacellefacilitycomesintooperationinEasternEurope.NooffshoreturbinenacelleassemblyfacilityiscurrentlyinoperationinNorthAmerica,althoughGERenewableEnergy,SGREandVestashaveannouncednacelleinvestmentplansforNewYorkandNewJerseyinQ12023.SimilartoNorthAmerica,LATAMhasnooffshorenacelleassemblyfacilitiesdespiteChineseturbineOEMMingyanglookingforoffshorewindinvestmentopportunitiesinBrazilsince2020.Lookingatthedemandandsupplysituationforthisdecade,ourbenchmarkresultsshowmorechallengesforoffshorewindthanforonshorewind.GWECMarketIntelligencedoesnotseeanyproblemsarisinginthenearterm,giventhatEuropeanOEMsareabletosharespareoffshorenacelleassemblycapacitywithemergingmarketsinAPACandNorthAmericain2023–2024.However,thesituationisgoingtochange.Startingin2026,weexpectEurope’sexistingoffshoreturbinenacelleassemblycapacitytonolongerbeabletosupportgrowthoutsideofEurope.Infact,weexpectthatfrom2027Europe’soffshorewindturbinenacelleassemblycapacitywillstruggletocopewiththegrowthexpectedinEuropealone.Existingcapacityneedstodoubleinordertomeettheprojecteddemandforthisregionin2030.LookingatAPAC(excludingChina),althoughoffshoreturbinenacellecapacityislikelytoincreaseto3.7GWafterexpansionworkiscompletedatoneoftheexistingfacilitiesin2024,itwillstillbeinsufficienttomeetdemandinthisregionfrom2027.Takingintoaccountestimatesthatdemandforoffshorewindturbinesinthisregionwillreach7.9GWin2030,itisimperativethattheinvestmentplansannouncedbywesternOEMsinpartnershipwithJapaneseandKoreanfirmsmaterialiseintime.IntheUS,consideringlocalcontentrequirements(LCRs)associatedtaxcreditsandincentivesundertheIRAandthetwo-yearleadtimeneededtobuildanewoffshorewindnacelleproductionfacilityfromscratch,itisoftheutmosturgencythatGERenewableEnergy,SGREandVestasturntheirinvestmentplansintoconcreteaction.TherearenoplansforoffshorewindprojectstobebuiltinLATAMuntilthelatterpartofthisdecade.However,earlyinvestmentisneededtoavoidbottlenecks.ThisisespeciallytrueofBrazil,where71offshorewindprojects,totallingmorethan170GW,hadfiledenvironmentalinvestigationlicencesbytheendof2022,accordingtothecountry’sMinistryofMinesandEnergy.KeycomponentsGWECMarketIntelligencehasbeenmonitoringthesupplychainforkeywindturbinecomponentssince2019.Basedonourlatestsupplychainupdate,nobottlenecksareexpectedin2023–2024forkeycomponentssuchasGWECGLOBALWINDREPORT202329Part2:Challengesinthesupplychainbladesandgenerators,butfurtherinvestmentinbothcomponentsisneededtoaccommodategrowthafter2024.Followingrecentinvestment,gearboxmanufacturingcapacityiswellpositionedtosupporttheexpectedgrowthupto2027.Aconcentratedsupplychainandregionalisedsourcingstrategies,however,lookcertaintocreatebottlenecks.ItisalsoimportanttonotethatthesupplychainforkeycomponentsishighlydependentonChina.Inadditiontogearboxesandgenerators,Chinacontrolstheglobalsupplychainforcastings,forgings,slewingbearings,towersandflangeswithmorethan70%globalmarketshare.Howotherregionsenactpoliciesdesignedtoreshoreproductionorrestricttradewillhaveastrongimpactonthesupplypictureandoncost.GlobalWTGgeneratormanufacturingcapacityin2022125GWGlobalwindgearboxmanufacturingcapacityin2022160GWGlobalWTGblademanufacturingcapacityin2022China60%Europe14%India11%US7%LATAM7%OtherAPAC1%China65%Europe22%India7%LATAM3%OtherAPAC3%China75%Europe12%India12%OtherAPAC1%130GWGlobalwindkeycomponentsupplychainoverviewSource:GWECMarketIntelligence,February2023GWEC.NET30Theincreasinglyambitiouswindenergytargetsbeingsettoreducerelianceontraditionalenergysources–bothintermsofgeographicalandmaterialdependence–presentachallengefromasupplychainperspective.Thisisparticularlytrueforrareearthelements(REEs),withtoppolicymakersincreasinglycallingforde-riskedsupplychains.Windenergyuseslargeamountsofrareearthpermanentmagnets(REPMs),contributingsignificantlytoglobaldemand.WindenergyOEMshavefacedchallengesinobtainingthequantitiesofREPMstheyneed,despitesupplygrowingatrecordspeedanddemandsofteningthanksto‘hybrid’windenergytechnologiesincreasinglyreplacingstandarddirectdrive(DD)turbinesoverthepastfiveyears.Hybridsystems(medium-speeddrivetrains)usejustone-tenthoftheREPMsneededinaDDdrivetrain.Inthefourthquarterof2022,Chinaaccountedfor68%ofrareearthminingand94%ofdownstreamprocessing.Onlyameagreamountofmaterialswasprocessedelsewhere,principallyinMalaysiaandEstonia.Becausethewindindustryisexposedtotheimpactsofgeopoliticaltensions–andfollowingatougheningofChina’sexportrestrictionsofrareearth-relatedtechnologies–thereisgrowingpolicyandindustrialconcerninEurope,NorthAmerica,Australiaandelsewhere.WhilesourcingenoughREPMsforwindenergygenerationcanbedifficult,thegreatestchallengefortheindustryisbeingabletosourcethemdomesticallyorfromade-riskedsupplychain.InmajormarketssuchasEurope,theUSandAustralia,demandforREPMsinwindenergyissubstantiallylargerthanlocalsupply.Policymakershavemadesomeeffortstobridgethisgap,forexampleintheUS,theUKandAustralia,whereBenchmarkMineralIntelligence(Benchmark)expectstoseerapidprocessingcapacitygrowthby2024-2025.lTheUSDepartmentofDefensehasawardedtwohigh-profilecontractstoMPMaterialsandLynasRareEarths,at35millionUSDand120millionUSDrespectively,toexpandrareearthoxide(REO)separationcapacity.Additionally,billH.R.5033proposestosupportmagnetproducersintheUStohelpthemcompetewiththeirChinesecounterparts.BenchmarkforecastsCasestudy:SourcingrareearthmaterialsforwindenergyfromlocalsupplychainsChina68%China94%Other6%Other32%ProcessingMiningChinadominatedREEminingandprocessinginQ42022202720202019201820172016201420152026202520242023202220210%20%40%60%80%100%16,00014,00012,00010,0008,0006,0004,0002,0000Medium-speeddriveDirectdriveHigh-speeddriveREPMconsumption,tonnesWindturbinetechnologyforecast(%)andequivalentdirectREPMuse(tonnes)Source:GWEC,BenchmarkMineralIntelligenceNote:ThischartdisplaysdirectREPMuse(magnetvolumes)inDDandmedium-speeddrivetrainsperannum.Itisnotnormalisedtofinalrawmaterialsdemand.Source:BenchmarkMineralIntelligencePart2:ChallengesinthesupplychainGWECGLOBALWINDREPORT202331Part2:ChallengesinthesupplychainactiveproductionfrommultipleREPMfacilitiesintheUS,notablybyMPMaterialsinTexasandUSARareEarthsinOklahoma.lTheUK’s850millionGBPAutomotiveTransformationFundwilldevelopPensana’s145millionGBPseparationfacilityatSaltendChemicalsPark,innorthernEngland.Thisfacilityisexpectedtoconsumeagrowinginputofexternalfeedstocks–asthefacilityscalesandthecompany’sownminereducesproduction–toproduceseparatedoxide,andistheUK’slargestefforttodatetoestablishdomesticrareearthprocessing.lInAustralia,IlukaResourceshasreceived1.25billionAUDinnon-recoursefinancingfromExportFinanceAustralia.Thisispartofthegovernment’swider2billionAUDCriticalMineralsFacilitytoestablishtheEneabbarefineryinWesternAustralia,withadditionalcapacitytoconsumeexternalfeedstocks.WhilethepipelineofprocessingfacilitiesinNorthAmerica,AustraliaandEuropeissignificant,itwilltaketimeforthefirstinputstobeconvertedintosaleablematerial,andtofundandconstructtherequiredfacilities.TheavailabilityoflocallyprocessedandmanufacturedREPMsmaybefurtherlimited,intheshortandmediumterm,byofftakessecuringsizeableportionsofplannedproductionforEVmanufacturers.WhereasafacilitysuchasSolvay’sLaRochelle,inFrance,maybeabletoscaleupfastthankstoexistingknowledgeandexperience,otherpartsofthepuzzleneedtoalign.Beforeadiversified,de-riskedandsizeablelocalsupplychainisestablished,morethan300GWofadditionalwindpowercapacitymayalreadyhavebeenbuilt.Benchmarkforecastsamorediversifiedandregionallyscaledrareearthprocessingmarketbeginningtotakeshapeafter2025,particularlyinEurope,NorthAmericaandAustralia.Environmentalprotectionsandeconomicconcerns,suchashighCAPEXrequirementsandlowChinesecosts,togetherwithconsiderableprojectleadtimes,castashadowoncapacityadditionforecasts,however.Alargepartofthewindindustrywill,asaresult,havetorelyonsourcingREPMsfromChinainordertomeetcleanenergydemandintheshortterm.WithinputfromBenchmarkMineralIntelligenceCasestudy:Sourcingrareearthmaterialsforwindenergyfromlocalsupplychains(continued)GWEC.NET32Part2:ChallengesinthesupplychainWindturbineinstallationvessels(WTIVs)AccordingtoGWECMarketIntelligence’sGlobalWITVsdatabase2022,ChinaandEuropeoperatethemajorityofjack-upandheavy-liftvesselsusedforoffshorewindturbineinstallation.NoglobalshortageofWTIVsisexpectedupuntil2026.Followinganoffshorewindinstallationrushin2021,newinstallationsinChinasloweddownin2022,andwedonotexpecttosee2021-levelinstallationsagainuntil2026.InEurope,thecurrentWTIVsupplychaincancopewithdemand,giventhatannualoffshorewindinstallationsarerelativelyflatandunlikelytoreachthe10GWmilestoneuntil2026–whichalsoexplainswhyEuropeanvesseloperatorsareabletoreleasetheirjack-upandheavy-liftvesselsoverthenexttwoyearstosupportthedemandfromemergingmarketsinAsia,mainlyTaiwanandJapan,andtheUS.Lookingatthesupplychainsituationforthe2027–2030period,however,whileGWECMarketIntelligencedoesnotexpectWTIVsupplychainconstraintsinChina,itforeseesalikelyshortageinEuropetowardstheendofthisdecade,unlessinvestmentinnewWTIVsismadebefore2027(assumingaleadtimeofthreeyearsfordeliveringanewWTIVvessel).IntheUS,whereonlytwotailor-madeJonesActcompliantWTIVsarecurrentlyunderconstruction,plansfornewWTIVswillhavetobeexecutedinthenexttwoorthreeyearstoavoidbottlenecks,iftheBidenAdministration’stargetof30GWofoffshorewindby2030istobemet.RestrictivetradepoliciescoulddelaytheenergytransitionThepastthreeyearshaveshowntheexposureandvulnerabilityofrenewableindustriestogeopoliticaldependencies,commoditypricecycles,logisticsbottlenecksandtradebarriers.Thesuddenpost-lockdownrecoveryofindustrialproductionin2021ledtofiercecompetitionforrawmaterials,aswellasongoingbottlenecksinmanufacturingcapacity.Russia’sinvasionofUkrainealsodeepenedgeopoliticalconcernsandintensifiedtheexistingtradetensionsbetweenChinaandothermarkets,suchasEuropeandtheUS.Allofthishasbroughttheurgencyofbuildingsupplychainsecurityforrenewablestothetopofthepoliticalagendaandcreatedaglobalgreeninvestmentrace.TheInflationReductionAct(IRA),signedintolawbytheBidenAdministrationinAugust2022,promisestomovetheUSclosertoitsclimategoal.ItsprovisionsonaxcreditsandLCRsassociatedincentiveshavegeneratedconcernintheEUandothercountriesabouttheIRA’spotentialnegativeimpactontheirdomesticmanufacturingindustries.Inresponse,theEUunveileditsGreenDealIndustrialPlan,whichaimstoboostEurope’scleantechcompetitivenessandtokeepgreeninvestmentsathome.Whatwearewitnessingnowisaclearmisalignmentbetweengovernment,industrial,tradeandfinancialpolicies.Itmustbeunderstoodthatwithoutwell-functioningandcompetitiveglobalwindsupplychains–alongsideequalaccesstorawmaterialsandcomponents–theenergytransitionwillnotmaterialise.ThereisadangerthattherestrictivetradepoliciesproposedbytheEUandtheUSmayriskdelayingtheglobalenergytransition.InoperationUnderconstruction/planned01020304050607080Heavylift(NorthAmerica)Jack-up(Europe)4812Heavylift(Europe)314Jack-up(NorthAmerica)42Jack-up(China)4719Heavylift(China)437Jack-up(Asiaex.China)410Heavylift(Asiaex.China)8Numberofwindturbineinstallationvesselsin2022Source:GWECMarketIntelligenceGlobalOffshoreWindTurbineInstallationVesselDatabase,October2022PART3:THERISKSANDOPPORTUNITIESOFREGIONALISATIONGWEC.NET34Asaresultofthecombinedeffectsofgeopoliticalthreats,climateimperativesandenergysecuritychallenges,thedeploymentofrenewableenergycapacityisexpectedtoacceleratesubstantiallyoverthecomingyears(seePart1).Thisaccelerationcomesascountriesandregionsmovetoimplementtheirambitiousenergyandclimatetargetsandisdrivenbycontinuedcostadvantagescomparedwithfossilfuels.GWECMarketIntelligencehasincreaseditsforecastforadditionalwindpowerinstallationsinthe2023–2030periodby143GW(+13%YoY).WenowexpectthefirstTWofwindpowertobeinstalledbymid-2023andthesecondTWtobereachedattheendofthisdecade.Thismassiveincreaseininstallationswillcreateaneedforsignificantadditionalcapacityacrosstheentirewindsupplychain(seePart2).Forexample,thereare153turbinenacelleassemblyplantsinoperationtoday,withanother74facilitieseitherunderconstructionorintheplanningstage.Theseassemblyplantswillneedcomponentsfromacrosstheglobalsupplychain,requiringsubstantialinvestmenttomeetdemand.OuranalysisinPart2alsorevealsthatshortagesforbothnacellesandkeycomponentsmaydevelopintheUSandEuropemid-decadeifthefreeflowoftheglobalwindsupplychainisimpactedbyregionalinitiativesaimedatachieving‘MadeinEurope’and‘MadeintheUSA’supplychains.GWECisconcernedthatgovernmentsaroundtheworlddonotunderstandthepotentialimpactsoftheirpoorlycoordinatedactions,whichiswhytheavailabilityofkeydataonsupplychaindevelopmentiscritical,andwhycontinuousdialoguewithindustrymustbeundertaken.TheInflationReductionAct(IRA)providessignificantincentivesforUS-basedmanufacturing,whichcouldrenderuncompetitiveanyprojectsthatdonotusethelevelsoflocalcontentrequiredtoqualifyfortheextrataxincentivesstipulatedinthelaw.TheEUhasexpressed‘seriousconcerns’abouttheIRA,allegingitmaybreachWTOinternationaltraderules,andhasrespondedwithitsGreenDealIndustrialPlan.WithinthisplanistheNetZeroIndustryAct(NZIA),whichrequiresnationalgovernmentstoapplynon-pricecriteria–definedasenvironmentalsustainability,energysystemintegration,andcontributiontotheresilienceofcleantechsupplychains–toprocurementmechanisms.ThesemeasureswouldallowgovernmentstoawardhigherpricesinprocurementmechanismstoenablecompaniestoinvestinEU-basedsupplychains,andmakeproductionmoresustainablethroughcirculareconomyandotherpractices.However,policymakersshouldbewareofintroducingmoreRegionalisationanddecouplingsupplychains–risksandopportunitiesGWECGLOBALWINDREPORT202335Part3:TherisksandopportunitiesofregionalisationCountry/RegionActionstakentoreshoresupplychainsUSAPassedInflationReductionAct(IRA)inAugust2022.Providesataxcredit,theadvancedmanufacturingproductioncredits(AMPC),forUS-maderenewableenergyequipment,includingvessels,withsunsetsbeginningin2030.ExtendstheexistingITCandPTCto2024andthenreplacesthemwiththeCleanElectricityInvestmentCreditandtheCleanElectricityProductionCredit,bothapplyingtodesignatedrenewableenergyandstoragetechnologies.Theysunsetin2032orwhentheTreasurydeterminesthatannualgreenhousegasemissionsfromelectricityproductionintheUSarelessthan25%of2022levels.IncentivisesdevelopersofUSrenewableprojectstopurchasedomesticallyproducedequipmentbyprovidinganadditionaltaxcreditiftheymeetdomesticcontentrequirement(DCR)thresholds.Toqualify,onshorewindprojectsinstalledbefore2025mustsource40%(20%foroffshorewind)ofallequipmentintheUS.Thisrisesto55%after2026(2027foroffshorewind).100%ofsteelandironconstructionmaterialsmustbemanufacturedintheUS.Requirescertainwageandapprenticeshiprequirementstoqualifyforsomeoftheincentives.IntroducesotherincentivestoinduceadditionalinvestmentineverythingfromruralsmallbusinessloansforenergyefficiencytoR&Dgrants.AccordingtoconsultancyWoodMackenzie,incentivesundertheIRAwillcutthecostofsolar,windandstorageequipmentbyanywherefrom20%to60%.EuropeanUnionTheEuropeanCommissionpresenteditsGreenDealIndustrialPlaninMarch2023,consistingofaNetZeroIndustryAct(NZIA)aimingtostrengthentheEU’sindustrialbaseforcleantechnologies,aCriticalRawMaterialsAct(CRMA)toincreaseEurope’scapacitytosourceandrefinecriticalrawmaterials,andmoreflexiblestateaidrules.TheNZIAaimstosupportinvestmentinmanufacturingcapacityin‘net-zeroemissions’technologiesinEurope.Forwind,itsetsanannualmanufacturingcapacitytargetof36GW.ThecommissionenvisagesanewSovereigntyFundtosupportcleantechsupplychainsandidentifiestheEUInnovationFundasabridginginstrument.TheCRMAincludesalistofmaterialsimportantforthewindindustrysuchasREEsusedinpermanentmagnets,copperforcablesandlithiumforbatteries.Withtheaimofbuildingitsowndomesticcriticalrawmaterialssupplychain,theCRMAwantstheEUtoextractatleast10%ofthecriticalrawmaterialsitusesfromwithinEuropeby2030.Atleast40%shouldbeprocessedwithintheEUbythen.UndertheCRMA,15%oftheEU’sannualconsumptionofrawmaterialswouldneedtoberecycledby2050.NewEUStateAidGuidelinesforClimate,EnergyandEnvironmententeredintoforceinJanuary2022,allowinggovernmentstoincludeupto30%non-priceelementsintheselectioncriteriaoftheirauctions.TheNZIAnowrequiresnationalgovernmentstoapplynon-pricecriteria,definedas:environmentalsustainability,energysystemintegration,andcontributiontoresilienceofcleantechsupplychains.MoreflexiblestateaidguidelineswerealsoproposedfornationalinvestmentsincleantechmanufacturingundertheTemporaryCrisisandTransitionFramework.Thisallowsnationalgovernments,foralimitedtime,tosupportCAPEXinvestmentsintheirnationalcleantechsupplychains.ItdoesnotcoverOPEX.TheEuropeanCommissionhasimposedanti-dumpingdutiesontowersimportedfromChina,increasingtariffsfrom7.2%to19.2%.GermanyFollowingEuropeanCommissionproposalstoallowmore‘stateaid’,Germanyisconsideringofferingfinancialsupporttoinvestmentsindomesticenergytransitionsupplychains,aswellaswindandsolarprojects.UKThroughnegotiation,theindustryhasagreedtoalocalcontentrequirement(LCR)of60%by2030.AccordingtotheUKgovernment,makingaLCRrealitywillrequire“significantinwardinvestmentactivity”oncapexelementsofoffshorewindprojects.PolandUnderthePolishOffshoreWindSectorDeal,alevelofLCRmustbeachievedatdifferentstages:“atleast20-30%”ofaproject’stotalvalueinthepreparatory,installationandoperationalstageforprojectsimplementedunderthefirst,pre-auctionstageofthesupportsystem;atleast45%forprojectsimplementedby2030underthesecond,auctionstage;andatleast50%forprojectsimplementedafter2030.Japan&SouthKoreaBothhavestrongrequirementsforlocalcontentinwindprojectsthateffectivelyrequirelocalisationofpartsofthesupplychain.TaiwanHasproducedaspecified‘list’ofcomponentsthatmustbelocalised,dependingonthecompletiondateofoffshorewindprojects.GWEC.NET36requirementsandrestrictionsonindustrythatdonotresultinbetterratesofreturnforcompanies.TheNZIAalsosetsanannualwind-turbinemanufacturingcapacitytargetof36GWforEUmemberstates,whichismorethandoublethe16GWofwindturbinesinstalledinEuropein2022.However,unliketheclarityandlong-termvisibilityprovidedintheIRA,theNZIAdoesnotdirectlyaddressthepoormarketconditionsthatcausedtheprofitabilityofEuropeanwindturbinemanufacturerstofall.NordoesitestablishnewEUfundingorfinancingmechanismstoscalesupplychainstothelevelrequired.AnotherkeypillaroftheEU’splan,theCriticalRawMaterialsAct,statesthatby203010%ofrawmaterialsshouldbeextractedandatleast40%ofthemprocessedintheEU.However,what’snotyetclearishowthepotentiallyhighercostsofthosematerialswillbedistributedfairlyamongwesternsupplychaincompanies.Manyothermajoreconomies,includingJapan,Korea,theUK,Poland,India,Taiwan,SaudiArabiaandBrazilalreadyhave–orareintheprocessofdesigning–measurestoensurehighlevelsoflocalcontentintheirwindenergysectors.Thetablebelowsummarisessomeofthemeasuresbeingintroducedbymajoractors.Somecountriesarereachingwellbeyondmanufacturing,going‘upstream’toachievelocalsupplyofcriticalinputsfortheirindustries,includingspecificsteelproductsusedinthewindindustryandrawmaterialssuchasrareearthelements.Insomecases,thisincludesinputsthatarecurrentlynotproducedlocally,orareproducedinsmallquantities.TheCOVID-19crisisanditsaftermath(includingwidespreaddisruptionoflogisticsandincreasedgeopoliticaltensions)havecreatedagreaterunderstandingoftheneedtocreateamorediversifiedandresilientsupplychain.However,globaltradeflowscontinuetobecriticaltoglobaleconomicmanufacturing.Additionally,actionsattemptingtodecouplefromChinaandtoreshoreorlocalisemanufacturingcapabilitiesarelikelytocreateunintendedconsequencesintermsofbottlenecksandhighercosts.Theseinturn,couldhavethepotentialtoslow,delayorevenderailtheglobalenergytransition.Itisofcriticalimportancethat,astheyareurgedtoactontheenergycrises,governmentsaroundtheworlddonotunderestimatethepotentialimpactsofpoorlyPrescriptiveHighlyprescriptivetaxesComponent-speciﬁcrequirementsIncentivebasedIncomeorproductiontaxcreditsMorecollaborativeapproachRangeofoptionsforlocalisationGWECGLOBALWINDREPORT202337Part3:Therisksandopportunitiesofregionalisationcoordinatedinterventions.ThisiswhyGWECadvocatesurgentandcontinueddialoguewiththewindandrenewablesindustry–alongwiththewidernetworkofkeycomponentsandcommoditiessuppliers–toensurethatpoliciesachievetheintendedgoalsofsupportingcost-effectiveandfasterdeploymentoflargerquantitiesofrenewableswhileboostinglocaleconomiesandemployment.Governmentshaveseveralchoiceswhentheylooktolocaliseorreshoretheirenergysectors.Theycanencouragetheuseoflocallyproducedcontenteitherthroughincentivesand/orpreferentialtreatment,suchastaxincentivesorfavourablecustomsduties.Alternatively,theycanspecifywhichgoodsorservicesmustbeprovidedbydomesticsuppliers.Ortheycanuseacombinationofbothoftheseapproaches.ForGWECmembers,localisingproductionisadesirableapproachthatcanleadtosignificantefficienciesandlogisticalsavings.However,achievingnecessaryscaletoamortiseinvestmentsinindustrialplantsisakeyconcern.Theindustryhasadvisedgovernmentsagainstprescriptivelocalisationrequirementsandarguedinsteadforflexibilityinordertobuildonnationalandregionalcompetitiveadvantages.Asarule,GWECismoresupportiveofincentive-basedratherthanprescriptivepoliciesastheformertendtogivemoreflexibilitytobothOEMsandthesupplychaininoptimisingtheirproduction.MeasuringtheimpactsofreshoringAsmorereshoringpoliciesarebeingproposedandintroducedglobally,itisimportanttoreflectonthepotentialimpactsoncostsandtimingofwindinstallations.Anytimepoliciesrequirelocalcontent,eitherthroughrestrictionsorincentives,thereisariskofincreasingtheoverallcostsofthewindpowerproduced.Anothersignificantunintendedconsequenceisthecreationofsupplychainbottlenecks.CurrentlythewindsupplychainishighlyglobalisedbutwithChinaastheprincipalsupplieratacomponentlevel.GWECMarketIntelligence’sglobalwindsupplychainanalysisshowsthatChinacontrolsmorethan70%oftheglobalsupplychainforpowertrains(mainshaftandgearboxplusgenerator),slewingbearings,towers,flanges,castingsandforgings.Bycomparison,accordingtoconsultancyWoodMackenzie,nopowertrainsorcastingsweremadeintheUSin2021.Eveninsomecountrieswheresophisticatedmanufacturingsupplychainsexist,forexampleIndia,Chinaistheprimarysupplierofcastings.Howpoliticians,policymakersandregulatorsgloballytrytoaddressthisconcentrationinthesupplychainwillhaveacriticalimpactonthewindindustryanditsabilitytodeliverthecapacitynecessaryforcarryingouttheenergytransitioninthetimelinesoutlinedintheParisAgreement.IndustryapproachestolocalisationAswehavenoted,windprojectoperatorsandOEMsmusttakeintoconsiderationaseriesofcomplex,interconnectedfactorswhentheydecidewheretolocatemanufacturingfacilities.Theseinclude:lthesizeoflocalwindmarketsllogisticalfactorsltheexistenceofnationalandregionalincentivesltheexistenceofspecificrulesaroundlocalmanufacturingltheavailabilityofcriticalcomponentsandmaterialsltheexistenceofaskilledworkforceltheneedtocreateormaintainpoliticalsupportforcontinuedmarketgrowth.Fortheoffshorewindsector,astrongdegreeoflocalisationisimperative,sinceproducingandassemblingverylargecomponentsisbestdoneportside,facilitatinginstallationinnearbywaters.Transportingfullyassemblednacellesplusbladesandtowersfromremotelocationsandinstallingtheminlimitednumberswouldlikelymakeprojectsuneconomical.Thereisnoexactformulaformanagingthetrade-offsbetweenlocalisationandaffordability.Achievingtherightbalancecanbeparticularlychallenginginnewmarketsthathaveyettodeploywindprojects–andassuchdonothavefullydevelopedand/orcompetitivewindsupplychains.Fromapurelycost-drivenpointofview,itmakesmoresenseforcountriestotakeaphasedapproachthatallowsimportsofkeycomponentsandaimstoincreaselocalisationasscaleGWEC.NET38Part3:Therisksandopportunitiesofregionalisationincreases.Itisalsoimportantforcountriestocarefullyconsidertheirspecificadvantagesintermsofaccesstomaterialsandcomponentsatcompetitiveprices,existingindustrialfootprintsandavailabilityofskilledlabour.Countrieswithrelativelysmalldomesticmarketsneedtolooktoregionalmarketsandplanhowtheirindustriescanmakethemostofregionalsupplychainswhileplayingtotheirownadvantages.Forexample,foroffshorewind,thecountriesaroundtheNorthSeahavebuiltanarrayofinterlinkedindustrialcapabilities,askilledworkforce,portfacilitiesandlogisticsaroundinstallationandoperationsandmaintenance.ItwouldbedesirableforasimilarcooperativeecosystemtoevolvetoaddressAPAC’sstrongdemandforoffshorewind,ratherthaneverycountrytryingtoquicklyevolveitsowncompleteoffshorewindmanufacturingandinstallationsupplychains.However,aswehaveseen,costconsiderationsoftentakesecondplacetoconcernssuchaslocalinvestmentandjobcreation;thepositionoflocalindustrialconglomerates;andpoliticalconsiderationsaroundnationalcontrolandrivalrieswithotheractors.Inmanycases,strongpoliticalfactorsmakecommitmentstocreatingalocalwindenergymanufacturingindustryaprerequisiteforachievingtheregulatorysupportthewindsectorneedstotakeoff.Thisisparticularlytruegiventhepredominanceofgovernment-runauctionsasthemainprocurementmechanismforwindenergyandthestrongpoliticalleversthatthesecreate.Inthelongrun,asmarketsdevelop,thegrowthofthewindenergymanufacturingsectorandrelatedservicesectorscanplayakeyroleinmaintainingsocialandpoliticalsupportfortheindustry.AswehaveseeninplacesasdiverseastheUK,theUS,BrazilandDenmark,localmanufacturingandemploymenteventuallytranslatesintolong-term,bipartisansupportforthewindindustry,andcreatesavirtuouscircleofgrowth,investmentandhigherpoliticalambitionforthesector.Inshort,industryisusuallywillingtoacceptsomeincreaseincostsinordertoachievepoliticalandregulatorysupportandwidersociallicence.Butsomewaysofachievingthisarebetterthanothers.Thedebatearoundtheproposedapproachesforachievingmorelocalcontentisdevelopingrapidly.GWEC,asalreadynoted,isstronglysupportiveoftheincentive-ledapproachthathasbeenadoptedintheUSthroughtheIRAandwouldsuggestthatthisapproachbeadopted–andadapted,ofcourse,tolocalcircumstances–inothermajorenergymarketssuchastheEU,theUK,Japanandelsewhere.Astheworldentersaphaseofsignificantaccelerationofrenewableenergydeployment,withgovernmentsandtheprivatesectorseekingtorealiseheightenedambition,GWECbelievesthattheincentiveapproachwillbeakeydifferentiatorforcountriesandregionswishingtoattractthehugeamountsofinvestmentthattheenergytransitionwillrequire.Althoughthepanoramaisevolvingrapidly,itseemsclearthatothercountriesandregionsarenowscramblingtomatchtheambitiousapproachtheUShastakenandwillrisklosingoutiftheydon’t.GWECalsobelievesthattheincentive-basedapproachwillplayakeyroleinenablingthewindindustrytopushbeyondthechallengingperiodithasfacedoverthelastfewyearsandbegintoscaleupforthenextphaseofglobalgrowthwithconfidence.TheincentiveapproachwillbeakeydifferentiatorforcountriesandregionsinattractingthehugeinvestmentsthattheenergytransitionwillrequireGWECGLOBALWINDREPORT202339Part3:TherisksandopportunitiesofregionalisationAshasbeenwidelynoted,currentmarketandprocurementarrangements–including‘racetothebottom’pricing,unfavourabletenderrulesaround‘negativebidding’andlowpricecaps–havecreatedahighlyunfavourableenvironmentforthewindenergymanufacturingindustry.Theevidencesofarsuggeststhatincentive-basedapproachestostimulatingsupplychaininvestment,suchastheIRAanditsprecursors,willbemuchmoreeffectivethanapproachesbasedaroundprescriptiveLCRsortraderestrictions.Governmentpackagesthatenabletransparentandwidelyavailableaccesstoincentiveswillimproveprojecteconomicsanddemand,providestrongimpetustosourcingfromdomesticmanufacturingandprovidethevisibilityforthesupplychaintomakelong-terminvestments.Incontrast,attemptstoforcelocalisationwithoutanymeasurestoimprovetheeconomicsofthewindenergyvaluechainriskincreasingcostsinanalreadyinflationaryenvironment,ultimatelyfurtherunderminingtheprofitabilityofthesector.Governmentandindustryneedtofindtherightbalancebetweencountries’legitimateexpectationstobenefitfromtheenergytransitionwhilemaintainingacooperativeenvironmentwherefaircompetitionandscalebenefitsplayout.Intheabsenceoffrank,evidence-baseddialogue,thereisariskthatlow-carbontargetswillbemissedandtheoverallcostoftheenergytransitionwillincrease.ContinuedcollaborationanddialogueareneededtoachievetheenergytransitionAsthedatainthisreportshows,policy-andmarket-leddemandforwindenergywillincreasedramaticallyinthecomingyears.Andyet,duetounsatisfactorymarketconditions,permittingbottlenecksandstop-startpoliticalsupport,investmentintheglobalsupplychainhasbeeninsufficienttopreparetheindustryfortheanticipatedgrowthahead.InvestmenthasbeenmademostconsistentlyinChina,creatingaworld-classwindmanufacturingsectorontheonehand,butcreatingahighlyimbalancedglobalsupplychainontheother,sparkinglegitimateconcernsarounddependencyandalackofresilience,particularlyinthewakeofCOVID-19andthepost-pandemiccrisisinlogistics.Part3:TherisksandopportunitiesofregionalisationGWEC.NET40Inordertomeettheambitionsofgovernments,energyconsumersandwidersociety,thewindindustryneedstoinveststronglyinincreasingthecapacityofthesupplychainwhilesimultaneouslybuildingresilienceanddiversification.GWECbelievesthatpolicymakers’approachtothistaskinthepresentperiodcouldgreatlyimpactthesuccessoftheenergytransition.Supplychaindiversificationandreshoringwillundoubtedlyaffectthecostsofthetransition,buttowhatextentwilldependonhowdecisivelypolicymakersintervene,andoverwhichtimeperiod.Ifpoorlyconceivedorexecuted,actionstoimposerapidreshoringcouldleadtosupplychainbottlenecks(particularlyintheEUandtheUS,butalsoinotherlargeeconomies),potentiallyleadingtomaterialdelaysinthetransition.Wehavealreadyseentheimpactofsuchbottlenecksonamorelocalisedscaleinthepast–thecurrentsituationcouldseefarmoresignificantimpacts.GWECrecommendsthatpolicymakers,internationalinstitutions,theprivatesectorandcivilsocietyengageinacomprehensivedialoguetobuildsupplychainsthatcanmeettherequirementsoftheJustEnergyTransitionwhileensuringthatnecessaryinputsareavailableattherightpaceandwithouttheriskofsharplyhighercostsandbottlenecks.Similarly,theintensificationofmorerestrictivetradepracticesandtradedisputescouldalsoleadtopriceincreasesanddisruption–althoughtheevidencesuggeststhat,despiteincreasinglylouddebate,wearealongwayfromanendtoglobalisation.GWEChasadvocatedacautiousapproachfrompolicymakersinvolvingfullconsultationwithrelevantactorsinordertofullyunderstandimpactsfromtraderestrictions.Thescaleoftheinvestmentandproductionneededtocarryouttheenergytransitionwillrequirecontinuedglobalandregionalcollaborationandthescalingupofwidespreadinvestment.Webelievethatitisimperativeforpolicymakerstocometogethertocollaborativelydesignmechanismsthatfacilitateastreamlined,incentivisedandacceleratedenergytransition.Ifdesignedproperlyandcomprehensively,policiescreatedtoenablethescalingupofthesupplychainanditsdiversificationrepresentahugeopportunityfortheworld.Wewillseeinsubsequentsectionshowdifferentcountriesandregionsareapproachingthetask.GWECandthewindindustrywillbeengaginginintensivedialoguewithallstakeholdersinthecomingmonthsandyearstoensureweareplayingourroleinachievingthescaled-up,confidentanddiversesupplychaintheworldneeds.Globaltradeishighlycomplex,andnoregionisclosetobeingself-sufficient,aMcKinseyGlobalInstitutereportpointsout.Itmakesafewkeypoints:lNoregionisclosetobeingself-sufficient.Everyregionreliesontradewithothersformorethan25%ofatleastoneimportanttypeofgood.lAbout40%ofglobaltradeis‘concentrated’,withimportingeconomiesrelyingonthreeorfewernationsforthisshareofglobaltrade.lOverthepastfiveyears,thelargesteconomieshavenotsystematicallydiversifiedtheoriginsofimports.lAlleconomieshavevulnerabilities,somemorethanothers.lInformedreimaginationofglobaltraderequiresagranularapproachbothinmappingconcentratedtraderelationshipsandindecidingonaction–whethertodoubledown,decoupleordiversify.Trendsinglobalisation–heretostay?PART4:THEIRAISSETTOTURBOCHARGETHEUSWINDSECTORGWEC.NET42Part4:TheIRAissettoturbochargetheUSwindsectorTheInflationReductionAct(IRA)isnotonlythesinglelargestinvestmentinrenewablepowerinthehistoryoftheUnitedStates,butsimplythelargestinvestmentinclimateactiontheworldhaseverseen.ItisclearwhytheIRAhasbeenwidelyreceivedas‘transformative’initsprojectedimpactdomestically,fromrenewableenergygrowthtojobcreationandsociety-widebenefitssuchascleanerair.FortheAmericangovernment,theIRAamountstoafundamentalreshapingoftheglobalrenewableenergysupplychain,byrepatriatingsignificantsegmentstoAmericansoil.Fromaglobalclimatestandpoint,theIRAkeepshopealiveformeetingtheParisAgreement’sgoaloflimitingglobalwarmingto1.5C.Withsomuchtodeliver,thereisasharpfocusfromthewindindustryonlocalcontentrequirementsandeffectsontheglobalsupplychain.Inthewiderglobalcontextofanexpectedsignificantincreaseinwindenergydeploymentacrossmanyregions,itisworthexploringtheoverallimpactoftheIRAasamodelfortransformativeclimateactionandasasourceofnationalandregionalcompetition.WhiletheIRAhasalreadyyieldedresultsinashorttime,acrucialpartofthebigpicturewillbehowthesupplychainadaptsovertimetofacilitatetheprojectedgrowth.SincePresidentBidensignedtheIRAintolaw,theAmericancleanenergyindustryhasannounced:lMorethan65billionUSDofcapitalinvestmentintocleanenergyprojects,enablingmorethan30GWofnewcleanenergycapacityl32neworexpandedcleanenergymanufacturingfacilities,including:l6newwindpowermanufacturingfacilities(orreinvestmentinexistingplants)l18newsolarmanufacturingfacilitiesl8newgrid-scalebatterystoragemanufacturingfacilitieslNearly14,000newmanufacturingjobsassociatedwithnewfacilityannouncementsl3billionUSDinconsumersavingsfromaccessingcleanenergysources.‘Transformative’impactItishardtooverstatethetransformativeeffectstheIRAwillhaveontheUSelectricitygridandthebroadereconomy.TheAmericanCleanPowerAssociation(ACP)estimatestheIRAwilldeliverupwardsof550GWofnewcleanpowerthroughtotheendofthedecade.Onceinplace,renewableenergyprojectswilldeliveraround40%ofthecountry’selectricity,equivalenttomeetingtheelectricityneedsof160millionhomesinthecountry.TheimpactontheAmericaneconomywillbeprofoundaswell.Thebusinesscommunitywillneedtoinvestupwardsof600billionUSDtobringtheseprojectstomarketandcreateandsupportaworkforceofatleastonemillion.Localcommunitieswillearnvaluabledividendsfromtheseprojectsintheformoflocaljobs,stateandlocaltaxrevenues,andincreasedeconomicactivity.ACPestimatesruralAmericancommunitieswillsee17billionUSDinnewstateandlocaltaxrevenues.Critically,theinvestmentsenabledviatheIRAwilldeliveremissionreductionsandconsumerenergyInflationReductionActsetsthestageforfundamentaltransformationoftheUSwindsectorGWECGLOBALWINDREPORT202343Part4:TheIRAissettoturbochargetheUSwindsectorcostsavings.AccordingtotheACP,USemissionswilldecline40%whileeachconsumerwillexperienceasavingofmorethan1,000USDperyearonenergybills.AnationalsupplychaininaglobalindustryTheIRAextendstheproductiontaxcredit(PTC)andinvestmenttaxcredit(ITC)forwindandsolarthrough2024beforetransitioningtoatechnology-neutraltaxcreditthatwillremaininplaceuntil2032orwhenelectric-sectoremissionsfallto75%of2022levels,whicheverislater.ThelegislationintroducesanewcleanenergycomponentmanufacturingPTC–providingequipmentmanufacturerswithacomponent-specifictaxcreditforeachunitproduceddomestically.Importantly,theUSCongressincludedprovisionstoboostrenewableenergyinvestmentinlow-incomecommunities,regionsofthecountryhistoricallydependentonthefossilfuelindustry,andindomesticmanufacturingcapabilities.Supportfordomesticmanufacturingispoisedtospurthebuildoutofarobustdomesticsupplychainforbothonshoreandoffshorewind.Componentfacilitiesthathavebeenidleinrecentyearsarecontemplatingrestartingproduction,whilenumerousequipmentproviderstotheoffshorewindindustryarepursuingplantsalongtheEastCoast.Recently,GEandSiemensGamesaannouncedintentionstobuildoffshorewindnacellemanufacturingplantssolongassufficientordersmaterialisefromrecentsolicitations.PreferencesfordomesticallymanufacturedcomponentsandmaterialspointtotheemergenceofamorerobustUScleanenergySupportfordomesticmanufacturingispoisedtospurthebuildoutofarobustdomesticsupplychainforbothonshoreandoffshorewindGWEC.NET44Part4:TheIRAissettoturbochargetheUSwindsectorsupplychain.Newmanufacturingfacilities,processingplantsandrawmaterialproductionwillfurthercatalyseeconomicgrowthandjobcreation,withtheintentionofinsulatingtheUSfromgeopoliticalsupplychainrisks.Protectingagainstthoseriskshasengenderedcriticismthattheactdisadvantagesforeigncompanies,buttheIRAhasalsosetinmotionanewwaveofclimateandcleanenergyambition.TheEUhasrespondedwithitsGreenDealindustrialplanandothercountriesareexploringtheirownresponses.However,uncoordinatedgovernmentactivityleadingtoanentrenchmentofnationalandregionalsupplychainsrisksstallingtheglobalwindindustry’sgrowth.Acoordinatedandbalancedexpansionistapproachfromgovernmentsisnecessaryfordomesticmarketstogrowwhileensuringahealthyglobalsupplychainthatcandelivercost-effectivecleanenergy.UncertaintyremainsonhowquicklytheglobalandAmericansupplychaincanadapttothenewconditionscreatedbytheIRA,todeliverthescaleofprojectedgrowth.Chinaproducesnearly70%ofallpowertrainsand65%ofcastings,whiletheUSproducednoneofeitherin20211.WhiletheUShasenoughmanufacturingcapacitytosupplymostdomesticdemandforonshoreturbineequipmentto2031,thestoryisdifferentforoffshore,wheretheUSisatastandingstart.WhetherenoughcapacitywillcomeonlinetosupplyallUSoffshorewinddevelopmentsplannedforinstallationby2027remainsakeyissue.Beyondwindpower,energystorageiseligibletoqualifyfortheinvestmenttaxcreditforthefirsttime,andgreenhydrogencanaccessaproductiontaxcreditrationeddependingonthelifecycleemissionsprofileofthefuel’sproduction.Withclearincentivesandstablepoliciesfortherenewablesindustryinplace,theACPexpectsannualwind,solarandenergystoragecapacityinstallationstogrowtoover90GWbytheendofthedecade,morethantriplingthe28GWinstalledin2021.Thisgrowthwillrequireunprecedentedsupplychainmobilisationand020202120222023e2024e2025e2026e2027e2028e2029e2030e4013%CAGR608012010028GW28GW38GW44GW53GW58GW68GW75GW85GW97GWProjectedannualcleanpowercapacityinstallationsundertheIRA20222023e2024e2025e2026e2027e05000100001500020000OffshoreOnshoreUSnewwindpowerinstallationsforecast(MW)Source:ACP,2022Source:ACP,20231.https://www.woodmac.com/horizons/boom-time-what-the-inflation-reduction-act-means-for-us-renewables-manufacturers/GWECGLOBALWINDREPORT202345carefulcoordinationbetweenthefederalandstategovernments,andalsoonagloballevel.SolidifyingthewindenergysupplychainTheUSwindindustryisasuccessfulexampleofonshoringmanufacturing.Stronggrowthbeginninginthe2000sattractedcoreequipmentproviderstoestablishUSfacilities.Thesemajorcomponentmanufacturersbroughttheirsupplychainswiththem.Asaresult,over85%ofwindturbinenacellesaremanufactureddomesticallyandthebroadersupplychainincludesmorethan500factorieschurningoutpartsandcomponentsfortheindustry.Previously,policyuncertaintyincludingimpendingexpirationofthePTChadputmuchofthewindindustry’ssupplychainatrisk.Now,withoveradecadeofpolicysupportinplace,equipmentprovidersarelookingtoreinvestintheirdomesticsupplychains.Ineffect,thelegislationwillhelpensuretheUSmaintainsathrivingUS-centricsupplychain.Theoffshorewindindustryis,inmanyways,inasimilarsituationtotheonshorewindindustry20yearsago.Growthprospectsareenticingequipmentproviderstoexplorestrategicinvestmentinnewmanufacturingplants.Infact,firmshavealreadyannouncedmorethan2billionUSDinplannedinvestmentoverthenextfewyears,accordingtotheACP.TheIRA’smanufacturingPTCandthedomesticcontentbonusforthePTC/ITCwillfirmupandpotentiallyacceleratetheseinvestments.However,challengesremain.TheabsenceofTreasuryguidanceimplementingthemanufacturingproductioncreditsandoutliningthequalificationrequirementsforGrowthprospectsareenticingequipmentmanufacturerstoinvestinnewplants:firmshaveannouncedplanstospendmorethan2billionUSDPart4:TheIRAissettoturbochargetheUSwindsectorGWEC.NET46Part4:TheIRAissettoturbochargetheUSwindsectorthedomesticcontentbonusarecurrentlyhinderinginvestments.InFebruary2023,theTreasuryissuedthefirstoftwonoticestoprovideguidanceonhowtaxpayerscanbenefitfromthemanufacturingprogrammeintheIRA.TheAdvancedEnergyProjectCredit–firstenactedbytheAmericanRecoveryandReinvestmentActof2009–awardsuptoa30%investmenttaxcreditforqualifying‘advancedenergyprojects’,includingthosethatenabletheproductionorrecyclingofwindturbines,solarpanels,heatpumps,batteriesandelectricvehiclecomponents.Moreover,4billionUSDwillbesetasideforinvestmentsinenergycommunitiesthathaveseenclosuresofcoalminesorretirementsofcoal-firedpowerplantsinrecentyears.3WindattheheartofacleanenergyfutureTheBidenAdministrationistargetinga50-52%reductionineconomy-wideemissionsby2030andanet-zeroemissionsgridby2035.Theelectricitysectorisexpectedtomakethelargestcontributiontoeconomy-wideemissionreductionsthisdecade.Thismeansthatrenewableswillbethelargestdriver,andthatwindenergy–bothonshoreandoffshore–iscriticaltoachievingthesetargets.Annualwindadditionsareexpectedtomorethandoublefromroughly10GWperyeartodaytomorethan20GWbytheendofthedecade.ThesevolumeswillsupportcontinuedinvestmentinthedomesticsupplychainandpositiontheUSasatopmarketwithintheglobalindustry.Strivingtowardsanet-zeroemissionsgridby2035willrequirefurthersignificantincreasesinannualinstallationvolumes.Allsignalspointtothesameconclusion:thewindindustrywillbeacentralcomponentoftheUSA’scleanenergyfuture.Co-authoredwithAmericanCleanPower3.https://www.whitehouse.gov/cleanenergy/clean-energy-updates/2023/02/13/treasury-issues-new-guidance-to-unleash-clean-energy-manufacturing/PART5:HOWEUROPEPLANSTORISETOTHECHALLENGEGWEC.NET48Part5:HowEuropeplanstorisetothechallengeEuropehasabigchallengeahead.InordertoreachtheobjectivesofEurope’snewenergysecuritystrategy,REPowerEU,itneedstobuildonaverage30GWofnewwindenergycapacityeachyearto2030.Yet,lastyearEUcountriesonlyinstalled16GWofnewwindcapacity.Andwindturbineorderswentdown47%YOYwhilstwesawhardlyanyfinalinvestmentdecisionsinoffshorewind.Thisistheresultofhigheruncertaintyfornewwindenergyinvestmentsin2022.Inflationcausedturbinepricestogoupoverthepasttwoyears.AndEUgovernmentsenactedunhelpfulanduncoordinatedpowermarketinterventionstocopewiththeenergycrisis.ThepermittingsituationinEuropeisstillnotwhatitshouldbe.AllofthesefactorsaremakingthesituationforEurope’ssupplychainmoreprecarious.PermittingSlowandcumbersomepermittingremainsoneofthebiggestobstaclesfortheexpansionofrenewablesinEurope.Some80GWofwindenergyprojectsarestuckinpermittingproceduresacrossEurope:theymustbeunlockedasquicklyaspossible.TheEUhassetouttosimplifypermittingrulesbyamendingtheEURenewableEnergyDirectiveandbyputtingforward‘emergencymeasures’allowinggovernmentsmoreleewaytosimplifypermitting.AspartoftheREPowerEUstrategytheEuropeanCommissionproposedanumberofimportantreformslastsummertospeedupthepermittingofrenewables.ThesenowneedtobenegotiatedandenshrinedinEUlegislationinarevisedEURenewableEnergyDirective.Firstistheproposaltoconsidertheexpansionofrenewablesamatterof‘overridingpublicinterest’,enablingtheEUtoreachclimateneutrality.Thiscouldspeeduppermittingsignificantlybyhelpingsolvethelegalchallengesrelatedtonewwindfarmsmorequickly.Thereviseddirectivealsoaimstoclarifywhichpermitsareincludedinthemandatorydeadlines(twoyearsfornew,oneyearforrepoweredprojects)forgovernmentstocompletethepermittingprocess.Thismeansthatalladministrativesteps,gridpermitsandenvironmentalimpactassessments(EIAs)willneedtobefinalisedwithinthesepermittingdeadlines.AchievingclarityontheproceduralsideiscrucialforspeedingupinstallationsasitremovesuncertaintyfordevelopersontheinterpretationofEUrulesacrosstheEU-27national,regionalandlocaljurisdictions.TherevisedEUrenewableslawwillalsoensurethatwindenergydevelopmentgoeshandinhandwithbiodiversityprotection.Theamendmentstothedirectivewillstrengthenthepopulation-basedapproachtospeciesprotection,HowEuropeplanstorisetotheenergysecuritychallengewhilecementingthecompetitivenessofitswindsupplychain2014201720122013201520262021201920202021820222023202420252026202820272029203005101520253035GWsﬁnancedintheEUNewcapacityﬁnanced2022decreaseInvestmentsneededfor2030EvolutionofwindenergyinvestmentsinEU-27Source:WindEurope,2023GWECGLOBALWINDREPORT202349whichisalreadypartofEUenvironmentallaw.DoingsowillensureagoodworkingbalancebetweentheparallelsetsofpublicpolicyinterestthatarerenewablesandbiodiversitywhilecontributingtoEuropemeetingbothitsclimateobjectivesanditsenergysecuritygoals.Inaddition,therevisionenvisagesevenfasterpermittingdeadlinesinselected‘go-to’areaswherebiodiversityrisksareminimal.ThefinalrevisionoftheEURenewableEnergyDirectiveisduetobecompletedinmid-2023.Inthemeantime,EUgovernmentscanapplytheEUemergencypermittingframeworkadoptedinDecember2022,whichconfirmedrenewablesasprojectsof‘overridingpublicinterest’solongassitelocationiscorrectlyselectedandmitigationmeasuresareinplacetoprotectbiodiversity.Italsoclarifiedthepermitsthatneedtobedeliveredwithinthemandatorypermittingdeadlinesfornewandrepoweredprojects,advancedgridconnectionsapprovals,andallowedsimplifiedEIAsforrepowering–coveringonlytheadditionalimpactslinkedtowindfarmexpansion.Themeasuresaremandatoryfornewprojectsandnewpermits,butgovernmentscouldalsoapplythemtoexistingonesshouldtheywishtodoso.SomeEUcountriesarealreadymakinguseoftheemergencyrulesandaretakingambitiousstepsnationallytoimprovepermitting.Germany’scabinethasalreadyapprovedandenactedmostoftheemergencymeasures.Itisapplyingtheconceptof‘overridingpublicinterest’incourtcases.Francehasvotedonlegislationthatwillspeeduptheexpansionofrenewables,andSpainismakinganefforttofast-tracktheapprovalofwindandsolarprojectsstuckinalargebacklogofenvironmentalpermitapplications.IndustrialpolicyEuropeisalsofast-forwardingitsgreenindustrialpolicy.2022wasadifficultyearforthewindenergysupplychain,withEurope’sturbinemanufacturersandsuppliershithardbyinflation,dysfunctionaltradeflows,bottlenecksinthesourcingofmaterialsandpoorauctiondesignsinsomeEUcountries.TheEUagreesthatitneedsareliableandcost-competitivewindsupplychaintoachieveitsenergysecuritygoals.AndthatitmustcontinueinvestinginitswindindustrialbasetodeliveramadeinEuropecleananddigitaltransition.KeepingandexpandingaEuropeanwindsupplychainwillreducecostsandenergybillsforendconsumerswhilecreatingjobsandgrowth.InresponsetotheUSIRA,theEUpresenteditsGreenDealIndustrialPlaninMarch2023tostrengthenEurope’scleanenergyindustries.TheplancontainstwoimportantpiecesoflegislationfortheEuropeanwindindustrywhichcouldallowittodeploytherightinvestmentsandvolumesgoingforward.FirstistheNet-ZeroIndustryAct,whichtargetstheindustrialmanufacturingofkeytechnologiesandequipmentthatarecentraltotheEuropeanenergytransition.Forwind,itsetsanannualmanufacturingcapacitytargetof36GW.Theactfocusesonsimplifyingthepermittingprocessesfornewfactories.Italsoidentifiesstrategicdependenciesacrosssupplychainsandproposesactionstoremoveexistingbottlenecksandincreasesupplychainresilience.SecondistheCriticalRawMaterialsAct,whichplaysakeyroleinimprovingthesourcingofmaterialsforcleanenergythatEuropeneeds.TheactexploresopportunitiesforGWEC.NET50miningandprocessingmorerawmaterialsinEuropewhileforgingnewtradedealswithpartnersthatcandiversifysupplyroutes.ItalsoemphasisestheimportanceofrecyclingandreusingkeymaterialstohelpincreasetheresilienceofEurope’ssupplychains.AllofthiswillbeunderpinnedbysomedegreeofEUpublicfinancialsupport,including,forinstance,channellingexistingresourcesfromtheEUandnationalRecoveryPlanstowardscriticalsupplychains.TheEuropeanCommissionandmemberstatesarediscussinginparallelamoreflexibleframeworkfortheallocationofstateaidthatcansupportindustrialcompetitiveness.TheEUisalsoconsideringsettingupanewEUSovereigntyFundtofinanceinvestmentsinthestrategicsectorschargedwithdeliveringtheEUGreenDeal.ElectricityMarketDesignCrucially,EuropeisreformingitsElectricityMarketDesign(EMD)thisyear.Thecurrentmarketdesignhasbeenbeneficialbyfacilitatingtheintegrationoflargeamountsofcost-effectiverenewables.EUpolicymakersareunderpressuretodeliveraquickreformthatalleviatestheenergycrisisburdenforend-consumerswhileavoidingareversalof20yearsofEuropeanenergymarketintegration.TheEUcannotaffordtogetthiswrong.Thecentralresponsetothecurrentcrisisremainsmoreenergysupply,inparticularwithmorehomegrownrenewableelectricitygeneration.Europe’sEMDmustthereforesendtherightinvestmentsignalstodeploywindenergyatscaleandensurethattheEU’sinvestmentenvironmentforfuturewindfarmsremainsattractive.Therefore,theexistingrevenuecapsoninframarginalgeneratorsmustberemovedandcannotserveasastartingpointforEMDreform.In2022,theEUadoptedatemporaryemergencyframeworkthatallowedgovernmentstointerveneexceptionallyonpowermarketstocontrolprices.ManyEUgovernmentsscrambledtointroducerevenuecapsforinframarginalpowergenerationinanuncoordinatedfashion–someeventaxedunrealisedrevenues.Thishasunderminedinvestorconfidenceandhaltedinvestmentinrenewables.ThenewEMDshouldallowdeveloperstoleveragethepotentialofContractsforDifference(CfDs)andPowerPurchaseAgreements(PPAs).ItshouldalsoleavespaceforinvestorstoaccesssomemarketrevenuesotheycanmeettheirPPAobligations.Thiswillbekeyforcompaniesmanaginglargeportfoliosofenergyinvestmentsacrossdifferentmarkets,andforbuildingsoundfinancingstrategiesforrenewables.Equallyimportantly,thenewrulesmustcementinvestmentcertainty.Marketscaleisachievedincountrieswheregovernmentsrespectthestabilityofexistingandawardedsupportschemesandmarket-basedarrangements,andwheregovernmentsplanaheadandprovideregulatoryvisibilityforthewindindustryanditssupplychainwithconcretewinddeploymentobjectives.TheEURenewableEnergyDirectiveprohibitsretroactivechangestoexistingsupportmechanismsandrequiresgovernmentstooutlineforward-lookingauctionschedules(timeline,budget,capacity)andtechnology-specificauctionstoattractinvestments.NoneofthisshouldbeputintoquestionasEuropereformsitsEMD.Co-authoredwithWindEuropePART6:WILLCHINACONTINUETOBETHEMARKETLEADER?GWEC.NET52Chinaistheworld’slargestwindmarket.Thecountryachievedrecordadditionsof68.6GWofgrid-connectedonshorewindin2020and16.9GWofoffshoreinstallationsin2021–amiracledrivenprimarilybythecompletephaseoutofrenewablessubsidies.Shiftingfromasubsidy-drivenmarkettoapro-renewablesmarketSince2022,China’srenewableenergymarkethasenteredanewstage.Thesupportforrenewableshasswitchedfromafeed-intariff(FiT)modeltoa‘gridparity’model,wherebyelectricitygeneratedfromrenewableswillreceivethesameremunerationasthatfromcoal-firedpowerplants.Nevertheless,thephaseoutofsubsidieshasnotslowedthepaceofrenewableenergydevelopmentinChina.Althoughnewgrid-connectedwindcapacityin2022wasonly37.6GW–a21%dropfromthepreviousyear,mainlydrivenbyCOVID-19restrictions–installationsofallrenewablesincludinghydropower,wind,solarandbiomassrecordedastellaryear,accountingfor76%ofthecountry’snewlyinstalledpowergenerationcapacity.China’srenewableenergycapacitywillcontinuetogrowasthecountrystrivestomeetatleasthalfofitsincrementalpowerdemandgrowthwithrenewablesunderthe14thFive-Year-Plan.Politicalcommitmentpavesthewayforlong-termdevelopmentSinceChina’sPresidentXiJinpingannouncedthe‘30-60’targetin2020–toachievepeakemissionsby2030andcarbonneutralityby2060–Chinahasstartedworkingonthelong-termgoalofcreatinganewtypeofpowersystemwithrenewablesatitscore.Speakingatthe20thPartyCongressReportin2022,thePresidentsaidthattheplanningandconstructionofthenewenergysystemshouldbeaccelerated,providingablueprintforenergysecurityandlow-carbon,greendevelopment.Bytheendof2022,standingat1,213GW,China’sinstalledrenewableenergycapacitysurpassedcoalpowerforthefirsttime.Renewableenergynowaccountsfor47.3%ofthecountry’stotalpowergenerationcapacity,withwindandsolarpowergeneration,atmorethan1,000TWh,providing13.8%ofChina’selectricityconsumption.Althoughrenewableenergyisgrowingfast,coalpowergenerationwillstillplayacrucialrolethisdecade.AseveredroughtlastsummersawSichuanprovincesufferelectricityshortagesduetoitsrelianceonhydropower.Newcoal-firedpowerprojectsinSichuanwereapprovedlatelastyeartopreventarecurrenceofthissituationbutwillbebuiltnexttolarge-scalerenewableenergyfacilitiessothattheflexibilityofferedbythermalpowerplantscansupportrenewableenergyintegration.Howthe14thFive-YearPlanwillsupportrenewablesFromtheGobiDeserttothesea,andfromtheTibetanPlateautothevastplains,several10GW-levelwindandsolarfarmshavebeencompletedandputintooperation,suchasJiuquaninGansu,HamiinXinjiang,andZhangjiakouinHebei.Gobiandotherdesertareas,includingtheupperreachesoftheYellowRiver,WillChinacontinuetobethemarketleader?GWECGLOBALWINDREPORT202353Part6:WillChinacontinuetobethemarketleadertheHexiCorridor,the‘Ji’bendoftheYellowRiverandXinjiang,areseeingtheconstructionofsevennewenergybases.Hydro,windandsolarinstallationsareplannedforsoutheastTibet,Sichuan,Yunnan,GuizhouandGuangxi,withanumberofoffshorewindpowerbasesalsoplanned.Thegovernmentplanstosupportanumberofdemonstrationprojects,suchasdeep-waterwind,highefficiencysolarcells,energyislands,large-scalerenewablehydrogen,hybridenergysolutionsandsmartmicrogridsinordertopromotetechnologicalinnovation.InInnerMongolia,sevenenergystoragetechnologyverificationplatforms,includingsolid-statelithium-ionbatteries,sodium-ionbatteriesandflywheelenergystorage,areunderresearchanddevelopment.Zero-carbonindustrialparksbeingbuiltacrossthecountrywillrequirelargeamountsofrenewableenergy.DatacentresarebeinglocatedinthevicinityofhugewindfarmsinnorthernChinatousegreenelectricitylocally.Long-termplansforgreenhydrogenproductionareinplaceinseveralprovinces.Leadingenergycompanieshaveestablishedspecialistsubsidiariestodevelophydrogentechnologyandbusiness.In2022,NorthChinaElectricPowerUniversitystartedofferingamajorinhydrogenscienceandengineering.DistributedwindprojectswillbepromotedinthevastruralareasofChina’scentralandsoutheasternregions.Itisestimatedthat10,000turbines,totalling50GW,willbeinstallednear5,000villagesduringthe14thFive-YearPeriod.HowthelocalsupplychainwillcopewithgrowthWithmorethantwodecadesofdevelopment,Chinahasawell-establishedsupplychainforthewindpowerindustry.Theproductionofwindturbinenacellesandkeycomponentsaccountsfor60-70%oftheglobalmarketshare(seePart2),whichmakesChinaacrucialcontributortotheglobalresponsetoclimatechange.QinghaiNeiMengguHunanGansuGiantonshorewind/solarenergybasesGiantintegratedenergybases(hydropower/wind/solar)OffshorewindbasesChina’s14thFive-YearPeriodrenewableenergydevelopmentplanSource:NDRC,NEA,2021GWEC.NET54Part6:WillChinacontinuetobethemarketleaderMorethan15windturbinemanufacturersareactiveinChina.Althoughthedomesticmarketislarge,competitionhasbecomeincreasinglyfierce,withrecord-lowpricesbeingreportedinthepasttwoyears.Tosurvivethedomesticpricewar,ChineseOEMsstartedexploringopportunitiesoverseas.Additionally,astheChinesegovernmentannouncedinSeptember2021thatitwouldstopfundingnewcoalprojectsabroad,thiswilldrivewindturbineexportsinthelongtermasthelargeChineseEPCcontractorswilllikelyshifttheirinvestmentfromthermalpowerplantstorenewableprojects.LeadingwindturbinetechnologyPricepressurehasactedasadriveroftechnologyinnovation,asChinesewindturbineOEMshavecontinuedtolaunchnewturbineswithgreaterpowerratingandbiggerrotorstoremaincompetitive.Overthepasttwo-to-threeyearsChineseturbineOEMslikeMingyang,GoldwindandHaizhuanghavereleasedoffshoreturbinesinthe16–18MWrange.InFebruary2023,EnvisionlaunchedtheEN-220/10MWmodelandtwoweekslaterSANYrolledoutthe230/8-11MWprototypeinBeijing–thelargestonshorewindturbineintheworld.TheChinesewindpowerequipmentindustryhasachievedahistoricleap–from‘following’to‘runningalongside’andnow‘leading’–inwindtechnologydevelopment.AmbitioustargetswillboostoffshorewinddevelopmentConstructionofseveral10GWoffshorewindbasesisanticipatedofftheeasterncoast,whileanumberofprovincialandmunicipalgovernmentshavebeenworkingonoffshorewinddevelopmentplanssince2020.Themarketpotentialforoffshorewindisgrowingandthelocalindustryisreadytosupportannualinstallationsofapproximately15GW.LastNovember,attheGlobalOffshoreWindSummit-China2022co-organisedbyGWECinHaikou,Hainan,theChinesewindindustryreleasedaninitiativethatcallsfor100GWofoffshorewindinChinaby2025,200GWby2030and1,000GWby2050.Ifthishappens,Chinawillmakeup50%oftheGlobalOffshoreWindAlliance’sglobaloffshorewindtargetfor2050.China’sfirstfloatingoffshorewindturbine,theThreeGorgesPioneer,wasinstalledinJuly2021inYangjiang,Guangdong.TwodemoplatformshavebeeninstalledOffshoreOnshore100002000300040005000600070008000Q42020Q32020Q22020Q12020Q42021Q32021Q22021Q12021Q42022Q32022Q22022Q12022Q12023AveragetenderpricesofwindturbinesinChina(CNY/kW)Note:PricesarebasedondateoftenderandincludewindtowerSource:ChinaBiddingCentre,February2023GWECGLOBALWINDREPORT202355Part6:WillChinacontinuetobethemarketleader202120222023e2024e2025e2026e2027e2028e2029e2030eOffshoreOnshore01020304050607080Chinesewindmarketdevelopment(GW)HainanHongKongShenzhenGuangzhouChina’sﬁrstﬂoatingwindturbineChina’sﬁrstﬂoatingwindplatformwithawaterdepthofmorethan100metresandanoffshoredistanceofmorethan100kilometresChina’ssecondﬂoatingwindturbine1GWproject:phase1(200MW)tobecommissionedby2025,phase2(800MW)by2027FloatingoffshorewindprojectsinSouthernChinaSeaSource:GWECMarketIntelligence,March2023since,andacoupleofprojectshavebeenannounced.China’sfirstfloatingwindplatformwithawaterdepthofmorethan100metresandfurtherthan100kilometresfromshore,the‘CNOOCGuanlan’–willbeoperationalinJune2023.ItwillprovideelectricityfortheWenchangoffshoreoilfieldinHainan.Inadditiontothesedemonstrationprojects,Chinaalsohasa1GWfloatingoffshorewindfarmplannedby2027–potentiallythefirstprojectofthisscaletobeinstalledglobally.PlannedforalocationoffWanning,Hainanprovince,thefirstphasecompletedafeasibilitystudyin2022.AsChineseprojectsareusuallyannouncedwithveryshortleadtimes,morefloatingwindprojectswithexpectedcommissioningdatesbefore2030maybeannouncedinthecomingyears.ChinawillcontinuetoleadglobalwindpowerdevelopmentFollowingits‘30-60’pledge,theChinesegovernmentcommittedtonon-fossilfuelsachieving25%ofthecountry’sprimaryenergymixby2030.InFebruary2023,theNationalEnergyAdministration(NEA)predictedthatgenerationfromwindandsolarpowerwilldoubleby2025Source:GWECMarketIntelligence,March2023GWEC.NET56from2020levels,withrenewableenergyaccountingformorethan80%oftotalnewelectricityconsumptionbythesameyear.Toreachthesetargets,250–300GWofwindpowercapacityneedstobeaddedbetween2021and2025.Sinceatotalof758GWofwindandsolarpowerhasalreadybeengrid-connectedbytheendof2022–andmorethan80GWofwindturbineorderswereannouncedandawardedin2022–GWECMarketIntelligenceexpectsChinatohitits1,200GWsolarandwindtargetby2025,fiveyearsaheadofschedule.Withannualinstallationsof70–80GWfortherestofthisdecade,thereisnodoubtthatChinawillremaintheworld’slargestwindpowermarket.Withannualinstallationsof70–80GWuntil2030,Chinawillremaintheworld’slargestwindmarketPart6:WillChinacontinuetobethemarketleaderPART7:HOWTOACHIEVEAJUSTTRANSITIONGWEC.NET58Part7:HowtoachieveajusttransitionAjustandequitableenergytransition(JET)isindivisiblefromasuccessfulpathwaytoglobalnet-tzeroemissions.Becausepeopleareatthecentreoftheenergytransition,communitiescannotbeleftbehindintheefforttomitigateharmfulclimatechange.Asaleadingagentoftheglobalenergytransition,thewindindustrymustplayanactiveroleintransitioningworkersfromcarbon-intensivesunsetindustriesandencouragingtheirentryintotherenewablessunriseindustry.Awindandrenewables-drivenJETpromotesthesocioeconomicwelfareofallaffectedworkersandcommunities.1,2InvestmentandeducationarekeydriversofaJET.Investmentcanfacilitateeducation,supportdisplacedworkersandcreatedemandforwindenergyworkersalongthesupplychain.Educationcanrangefromretrainingorre-skillingprogrammestowidercommunityoutreach.JETreceivedmuchattentionatCOP27lastNovembersignallingaclearappetitefromtheclimatechangecommunityforapeople-centredtransition.Lookingahead,thisisessentialbothtomeetnet-zeroscenariopathwaysandtoensurethatthenecessaryworkforceisavailabletoenablethemassiveexpansionrequiredoftheglobalsupplychain.TheroleofthewindindustryinenablingaJETEnergytransitionpathwaysmustbedesignedtoincorporatecountries’emissions,financingneedsandenergyprofiles–especiallyfossilfueldependencies.Amultidimensionaltransitionmusttakeplaceatanationallevel,withappropriatepolicysupport,andlocallythroughvaluecreationthatensuresthedividendsofaJETarefeddowntoimpactedstakeholders.ThereisoftenlittleunderstandingatthelocallevelofwhataJETmeansforcommunities.ThewindenergyindustrycanincreaselocalawarenessbyhighlightingthejobPart7:Howtoachievea‘justtransition’Rareearthdemandbyend-usesectorsandbreakdownofmagnetdemandbymass,20201.ILO,2015,Guidelinesforajusttransitiontowardsenvironmentallysustainableeconomiesandsocietiesforall2.ILO,2022,JustTransitionPolicyBrief,Genderequality,labourandajusttransitionforall3.IRENA(2017),Leveraginglocalcapacityforonshorewind4.IRENA(2018),RenewableEnergyBenefits:LeveragingLocalCapacityforOffshoreWindCatalystsMagnetsOthersPolishingagentsEVsConsumerelectronicsAirconditioningWindturbinesOthersBreakdownofthe29%ofdemandrepresentedbymagnets29%20%11.4%1.75%2.5%7.55%5.8%13%38%Source:IRENA,2022GWECGLOBALWINDREPORT202359Part7:Howtoachieveajusttransitioncreationpotentialofviableprojects.Renewableenergyemployspeopleofalltradesandlevelsacrossthefullvaluechain,fromprojectplanningtodecommissioning.IRENA’sanalysis3showsthata50MWonshorewindfacilitycreatesopportunitiesformorethan144,000person-days,anda500MWfixed-bottomoffshorefacility4foraround2.1millionperson-days.5Theanalysisalsoshowsthatover60%oftheworkforceinonshorewind,andoverhalfinoffshorewind,requiresminimalformaltraining.Science,technology,engineeringandmathematics(STEM)graduatesmakeuparound28%oftheonshorewindworkforce–21%foroffshorewind.Highlyqualifiednon-STEMprofessionalssuchaslawyers,logisticsexperts,marketingprofessionalsandexpertsinregulationandstandardisationaccountforroughly5%and20%respectively,whileadministrativepersonnelmakeup4%and8%,respectively.Theproportionofwomenintherenewableenergyworkforceisestimatedataround32%,with21%inwindenergy.6GWECisintheprocessofupdatingthesefiguresandwillreportonprogresslaterthisyear.Asinothersectors,thereisahigherproportionoffemaleworkersinmorejuniorroles.UpstreamsupplychainimpactsAsthewindenergyindustrygrows,sowillitsimpactonseveralsectorsandcommunities.Withupto90%ofawindturbine’smassbeingmadeofconcrete,ironandsteel,therewillbeanincreaseindemandforthesethreecriticalmaterialsasinstalledwindcapacitygrows.7IncreasedwindturbinemanufacturingwillalsoleadtogreaterdemandforREEs–atrendcompoundedbysimilarpressuresfromotherrenewableenergytechnologiesandothersectors.IncreaseddemandisexpectedforREEsincludingneodymium,dysprosium,praseodymiumandcriticalmineralssuchascopper,nickelandzinc.85.IRENA(2019),Futureofwind:Deployment,investment,technology,gridintegrationandsocio-economicaspects6.IRENA(2020),WindEnergy:AGenderPerspective7.WindEurope,2022,responsetotheEU’sconsultationontheRawMaterialsAct8.GWEC(2022),GlobalWindReport9.IEA(2021),TheRoleofCriticalMineralsinCleanEnergyTransitionsGWEC.NET60Part7:HowtoachieveajusttransitionDemandforREEsundersustainabledevelopmentscenariosisforecasttoincreasefourfoldby2040.9Thewindenergyindustrymustoperatesustainablyandwithgoodgovernanceacrossthesupplychainsforthesematerials,protectingdisadvantagedorvulnerableminingcommunities.SouthAfricaandIndonesia:theriseoftheJETPartnershipTheJustEnergyTransitionPartnership(JETP),announcedatCOP26inNovember2021,isacollaborativeagreementbetweenSouthAfricaandFrance,Germany,theUK,theEUandtheUStocreateasynergybetweentheglobalSouthandtheglobalNorth.TheJETPmodelincludes8.5billionUSDinfundingcoupledwithaccesstotechnicalexpertiseforknowledge-sharing.10SouthAfricahasbeenafrontrunnerinJETengagement,acknowledgingitinthecountry’sclimatecommitments(NDCs)undertheParisclimateagreementasearlyas2015.11WhileitunderstandstheneedforaJET,thegovernmenthassofarfailedtosufficientlyengagewiththecommunitiesthataremostaffected–thehighlycoal-dependentregions.ThePlanningforClimateCommission(PCC)hasmadesignificantprogressinacceleratingaJETdialoguethroughaseriesofmulti-stakeholderconsultations.ThePCCdevelopedajusttransitionframeworkthatseekstoengageintacklingvariousaspectsoftheenergytransitionincludingsocialsupport.12Theseconsultationsareongoingandshouldcontinueinordertoensurethatthecoreprinciplesofwhatthejusttransitionframeworkseekstodoarefeddownthevaluechaintoallthoseaffected.MultilateralsocialdialogueiscrucialtoinvolvingandengagingallstakeholdersinaJET.Includingthecommunitiesmostaffectedbythecoalphaseout,educatingandsupportingthemthroughthetransition,willmakethedifferencebetweenconceptualisationandimplementationofaJET.OthercountrieswillusesimilarJETPsasafinancingmechanismforJETimplementation.TheG7alludedin2022tousingJETPstoMineralintensityforwindpowerbyturbinetype10.AnnextoG7LeadersStatementPartnershipforInfrastructureandInvestment11.https://www.wri.org/update/south-africa-strong-foundations-just-transition12.https://www.climatecommission.org.za/just-transition-framework050100150200250ZincCopperChromiumManganeseMolybdeumNickelDysprosiumNeodymiumTerbiumPraseodymiumOthersRareearths03000Overallmineralintensity(kg/MW)Useofrareearthelements(kg/MW)6000900012000EESGPMSGPMSGDFIGDirectdriveGearboxSource:KIMTae-Yoon,IEA/STO/ESIOGWECGLOBALWINDREPORT202361Part7:HowtoachieveajusttransitionsupportaJETinAfricanandAsiancountriessuchasIndonesia,India,SenegalandVietnam.13AttheBaliG20summit,heldinNovember2022,IndonesialauncheditsJETPsupportedbytheInternationalPartnersGroup(IPG),whichincludestheUS,Canada,Japan,theEU,theUK,Norway,Germany,France,ItalyandDenmark.Overaperiodofthreetofiveyears,theIndonesianJETPpromisestomobilise20billionUSDworthofinvestment.14IncreasedinvestmentwillonlydriveaJETifthefundingisactuallyfedintolocalitiestoacceleraterenewablesprojects.Onechallengethewindsectorandotherrenewablesarefacingisalackofagency,withfundingbeingsetoutbutnotfedintotheprojectpipeline.Thismustbeactivelychallenged:iflocalprojectsandinfrastructurearenotimplemented,theJETPriskslosingcredibility.Ifcoalistobephasedoutincoal-dependentareas,thesupplyofrenewablesneedstogrowsignificantly.Toachievethis,countriesneedtocreateenablingregulatoryandeconomicconditionsthatsupportandfacilitatenotonlythedeploymentofrenewableenergyassetsbutalsotheirsupplytothegrid.Thiswillunderpinthecaseforacoalphaseoutdrivenbythecredibleprospectofasufficientvolumeofcleanenergytoreplaceit.TheSouthAfricainitiativehasthepotentialtopavethewayforlonger-termclimateactionthroughpolicyinstrumentsliketheJETP.Othercoal-dependentcountriescanlooktoSouthAfricatoseethelinksbetweenajusttransition,achievingnationaldecarbonationgoals,andmeetingNDCs.UnitedStatesandtheInflationReductionAct:investmentintrainingandlocalsupplychainsTheBidenAdministration’sInflationReductionAct(IRA)15isanationalpolicyframeworkthatpromisestofurtherthejusttransitionbyenablinglocalproductionandjobcreationthroughanunprecedentedarrayofmeasuresfacilitatinginvestmentintogoodjobsandmitigationmeasuresthatprotectimpactedworkersandcommunities.Byspecifyingtheworkforceandcommunitiesaskeystakeholdersthatshouldbenefitfromthisinvestment,itsendsaclearsignaltoinvestorsandcivilsocietythatagreeneconomycanprovidestability.StatesintheUShavetypicallytakenalocalisedapproachtoassessingtheimpactsoftheenergytransitionontheirworkforce.Thegrowthoftheoffshorewindsectorisopeningupopportunitiesforworkersinotherindustriestopursueacareerinthegreeneconomy–facilitatedbyreskillingandtraininginvestment,alongsidestakeholderengagement.Examplesofthisinclude:lBOEMCarolinaLongBayoffshorewindauction:biddersareawardeda20%monetarycredittosupportworkforcetrainingprogrammestodevelopthelocalsupplychain.16Thetotalcreditawardedisaround42millionUSD.lTheNorthAmericaBuildingTradeUnion(NABTU)andØrsted:aProjectLabourAgreement(PLA)bringstogethertheprivatesectorandtheunionstohelptheUSworkforcemeettherequirementsoftheoffshorewindfarmsupplychain.17Policyrecommendations1.Committoadiverse,equitableandinclusiveworkforcethroughoutreach.Mainstreamingdiversity,equityandinclusionintheworkforcerequirescommitmentandactionacrosscompanysegments,fromhumanresourcestomarketingtoseniorleadership.Thewindsectorshouldbeseenasanattractiveandwelcomingplacetoworkatdifferentcareerstages.Youthoutreachandeducationcanensurethattheindustry’sdiversifiedjobopportunitiesareunderstood,particularlyinearly-stagewindcountries.Diversityshouldencompassgender,ethnicityandphysicalability.Aculturalchangeincompanieswillenablethemtoleveragethetalentof13.https://www.g7germany.de/resource/blob/974430/2057928/1315842ed9de069fa1be82dab18dabb2/2022-06-28-leaders-communique-executive-summ-data.pdf?14.https://www.gov.uk/government/news/indonesia-just-energy-transition-partnership-launched-at-g2015.https://www.epa.gov/green-power-markets/inflation-reduction-act16.https://www.doi.gov/pressreleases/biden-harris-administration-announces-winners-carolina-long-bay-offshore-wind-energy17.https://nabtu.org/press_releases/nabtu-orsted-sign-landmark-mou/Diversityshouldencompassgender,ethnicityandphysicalabilityGWEC.NET62Part7:Howtoachieveajusttransitionwomenandpeoplefromminorities.2.Drivesocialdialogueandincreasedstakeholderengagementbothnationallyandlocally.Creatingspaceforsocialdialogueandincreasingstakeholderengagementsupportssocialcohesionandacommonunderstandingofthechallengesandopportunitiesahead.Stakeholdersincludedisplacedworkers,residentsofcommunitieshostingprojectsandmembersofaffectedcommunitiessuchasthefishingindustryforoffshorewind.TheneedtodiscussaJETiswellunderstoodbutthedialogueneedstotranslateintonationalambition,alongsidetransparentlocalengagement,forcommunitiestounderstandandfeedintotheactionsthatwillaffectthem.3.Promotepublic-privatecollaborationtocreatevaluelocally.Regionsthatdependontheproductionoffossilfuelsforrevenuemayfaceeconomicdisplacementinarapidphaseout.Onthepathtodecarbonisingtheirenergysystems,theymustbeencouragedtotransitiontomoresustainablelocalsupplychainsandjobs.Governmentsandthewindindustryshouldcollaboratetoreviewlocalindustrialsupplychainsandfosterthecreationofdecentjobs.Schemestoincubatebusinessesandcapabilitiesforthewindsector,suchasfavourableloansandthepromotionofindustrialclusters,willsupportthecreationofviablelocalsupplychains.4.Tailoredreskilling/retrainingpathwaystotransferfromcarbon-intensiveindustriestowindindustryjobs.Acknowledgingvaryingskillsetsandprovidingtailoredtrainingprogrammeswillreducethebarrierstoentryintothewindworkforce.Havingidentifiedviableprojects,thepublicsectorandthewindindustryshouldworktogethertoidentifycommunitiesofneedandmatchthemwithanticipatedworkforcegaps.Bysupportingcareerprogressionpathwaysforfossil-fuelworkersintorenewableenergy,thepublicsectorwillencouragelabourmobilityandupskilling.5.Investmenttofacilitateretraining,reskillingandsustainablejobcreation.Governmentsandtheprivatesectorshouldprovidefundingtowardstrainingandreskillingprogrammesthatcanbenefitthemboth.Investingintotheworkforcewillbenefittheeconomyatlargewhileenablingtheprivatesectortotailorskillstoitsprojectrequirements.Theinvestmentwillpayoffinmultiplewaysandboostthegreeneconomy.6.Regulationsinminingandextractivecommunitiestoensureanethicalworkenvironment.Nationalpoliciesmustensurethatworkingconditionsdonotallowtheexploitationofworkers,andthatminingcommunitiesforREEandothercriticalmaterialsaresustainable.Becausethesematerialscomefromalimitednumberofcountries,targetedregulationisneededtoprotecttheworkforceandpromotegrowthinthewindenergysector.Standardsmustbesettoavoidgreaterdemandleadingtomoreexploitation,andstrictlyenforcedtoprotecttherightsofworkersandprovidethemwithdecentworkingconditions.CASESTUDIESGWEC.NET64CaseStudy:GlobalAllianceforSustainableEnergyTheGlobalAllianceforSustainableEnergyisanindependentorganisationthataimstomaketherenewableenergysectorfullysustainablethroughoutitsvaluechain.ThealliancebringstogetherNGOs,utilities,suppliers,developersandend-userstotackletheclimateemergencyandreachnetzerowhileimprovingpeople’squalityoflife.TheAlliance’sscopeofworkspanssupplychaindecarbonisation,circulardesigncriteria,humanandlabourrights,biodiversity,andmoregeneralprogresstowardsajustandsustainableenergytransition.Sinceitsinceptionin2022,theAlliance’sworkhasbeenfocusedonCircularDesignCriteria.TheCircularDesignWorkingGroup’spositionpaperoutlinesacirculardesignstrategythataimstominimisewasteandpollutionwhilepreservingresources.Theworld’scurrentlineareconomymodel,definedbyatake-make-disposeapproach–whichresultsinthedepletionofnaturalresources,wastegenerationandenvironmentaldegradation–mustevolveintoacirculareconomysystemthatconsiderstheentirelifecycleofaproduct,fromrawmaterialsourcingthroughto‘endoflife’reuse,repurposingorrecyclingofcomponentparts.TheAlliance’sambitionistobethemissinglinkthatconnectsalltherelevantparticipantsintheenergysectortoimprovetransparency,circularityandtheoverallsustainabilityofthesectorbywidelyspreadingthedefinitionGlobalAllianceforSustainableEnergyHuman/LabourrightsDeﬁnedindustry-widesustainabilitystandardsandKPIsFOCUSAREASMEMBERSOUTCOMESecretariatIndustrialmembersAdvisorymembersSupportingmemberSupplyChainDecarbonisationCircularDesignCriteriaBiodiversityStructureoftheGlobalAllianceforSustainableEnergyGWECGLOBALWINDREPORT202365ofsustainabilitystandardsandtheadoptionofbestpractices.Thefollowingareexamplesofelementsputforwardbytheallianceforintegratingintotenderprocessesbetweensuppliersandclients:lA’billofmaterials’andEnvironmentalProductDeclarations(EPD)/LifeCycleAssessments(LCA)tobeusedasmetricstorewardsuppliersalignedwithrequirementssuchaslimitsorbansonspecificrawmaterials,thresholdsforrecycledrawmaterials,CO2andwaterfootprint.lTraceabilityinformationtoguaranteethecompletevisibilityofalltheactorsinvolvedinthesupplychain.lArawmaterialassuranceframeworktodrivevisibilityandadoptionofmaterialsthataretransparentlycertifiedaccordingtointernationalindustrystandards.Alliancemembershavesetthefollowingtargetsbasedontherecommendationsputforward:l100%ofnewequipmentproduced/acquiredwithCertifiedEPD/LCAwithexplicitbillofmaterialsbytheendof2024.lTraceabilityandauditingforatleasttwokeyrawmaterialsusedinonemaincomponentbytheendof2024.lTraceabilityandauditingforallapplicablekeyrawmaterialsusedinonemaincomponentbytheendof2025.lOnekeyrawmaterialusedinonemaincomponenttobecertifiedbytheendof2024.lAllapplicablekeyrawmaterialsusedinonemaincomponenttobecertifiedbytheendof2025.ComplementarytotheAlliance’sCircularDesignworkisafocusonsupplychaindecarbonisationacrossscopes1,2and3,drivenbytheneedtoestablishacommonunderstandingbetweenutilitiesandsuppliersonclimate-compatiblebuyingstrategies.TheGlobalAllianceforSustainableEnergywasinitiallyconvenedbytheEnelFoundation.ItincludesindustrialmembersEnelGreenPower,EnergiasdePortugal,AdaniRenewables,Electrobras,Iberdrola,NTPC,Goldwind,NordexAcciona,PrysmianGroup,TrinaSolar,Risen,JASolarand3M.AdvisorymembersincludeStudentEnergy,YouthClimateLeaders,PolitecnicodiMilanoandPolitecnicodiTorino.ItcountsIRENA’sCoalitionforActionasasupportingmember.Asof2023,GWECandtheGlobalSolarCouncilarejointlyrunningtheSecretariat.Utilitiesandsuppliersmustestablishacommonunderstandingonclimate-compatiblebuyingstrategiestodrivesupplychaindecarbonisationGWEC.NET66CaseStudy:WomeninWindThewindenergyindustryisstillheavilymale-dominated,withonly21%oftheglobalwindenergyworkforcebeingwomen–lowerthantherenewablessectoroverallandlowerthantheoil&gasindustry–accordingtothelandmarkWindEnergy:AGenderPerspectivereport,publishedin2020bytheWomeninWindGlobalLeadershipProgram(WiW)inpartnershipwithIRENA.1WhileGWECanditspartnersareproactivelyworkingtomakeprogressonthis–andthedataisbeingupdated–thereport,whichwasbasedonasurveyofmorethan1,000peopleworkinginwind,revealedasignificantleadershipimbalance,withwomenoccupyingjust8%ofseniormanagementpositionsintheglobalwindenergysector.Mostwomeninthesectorareemployedinadministrativeandnon-STEMroles.WomeninWind(WiW)wasformedin2019toaddressthisgapinthewindindustry.Itaimstosupportandencouragetheadvancementofwomeninthewindenergysectorbyprovidingthemwiththenecessaryskillsandopportunitiestobecomeleadersintheirfield.Lookingahead,WiWaimstoleadbyexampleandtoworkwithcompanieswithinthewindsectortoactivelyimplementtheprinciplesofequalitybycuratingorganisation-widepoliciesthatpromotegenderdiversityinareassuchasrecruitment,andcareerprogressionforwomenatalllevels.Thiswillrequireregularreportingtoensureprogressiswellcommunicated,visibleandfullyaccountable.Byaddressingtheunderrepresentationofwomeninleadershippositionsinthewindenergyindustry,WiWalsoseeksWomeninWind1.https://www.irena.org/publications/2020/Jan/Wind-energy-A-gender-perspectiveWiWsupportsandencouragestheadvancementofwomeninthewindenergysectorGWECGLOBALWINDREPORT202367CaseStudy:WomeninWindtodriveinnovationandgrowthinthesector,andtoencourageamorediverseandinclusiveculture.ProgrammemethodologyCurrentlyrecruitingitsfifthcohort,WiWisanintensive12-monthprogrammecoveringarangeoflearninganddevelopmentactivitiesincludingonlinecourses,workshops,mentoringandnetworkingevents.Theprogrammehasbeendesignedtobeflexible,allowingparticipantstofittheirlearninganddevelopmentactivitiesintotheirexistingworkschedules.KeyoutcomesIncreasedrepresentationinleadershippositionsAsaresultoftheprogramme,severalparticipantshavebeenpromotedtoleadershippositionswithintheirorganisations,andmanyothershavetakenonadditionalresponsibilitiesandexpandedtheirprofessionalnetworks.ImprovedleadershipskillsandconfidenceParticipantshavereportedamarkedimprovementintheirleadershipskillsandconfidence,GWEC.NET68withmanycitingincreasedvisibility,bettercommunicationskills,andamorepositiveoutlookaskeybenefitsoftheprogramme.IncreaseddiversityandinclusivityTheprogrammehashelpedtoraiseawarenessoftheimportanceofdiversityandinclusivityinthewindenergysector,andhasprovidedaplatformforparticipantstosharetheirexperiencesandbestpractices.StrongerprofessionalnetworksParticipantshaveestablishedstrongprofessionalnetworkswiththeirpeers,mentorsandindustryleaders,whichprovidesvaluableopportunitiesforcollaborationandsupport.Overthepastfiveyears,WiWhassucceededinsupportingtheadvancementofwomeninthewindenergysectorandencouragingamorediverseandinclusivecultureintheindustry.Theprogrammehasprovidedparticipantswiththeskillsandopportunitiestheyneedtobecomeleadersintheirfield,andhashelpedincreasetherepresentationofwomeninleadershippositionsinthewindenergyindustry.VanNguyenThanhHeadOfEngineeringAndConstruction,UPCRenewablesVietnamManagementLLCVanNguyenmanagesVietnamprojectsatUPCRenewables.SinceJune2018,shehasworkedonprojectsthroughvariousstages,fromdevelopmenttoconstruction,includingLacHoaandHoaDong.Vaniscurrentlyleadingontwo50MWprojects,TranDeandSongHau.Herprojectcontrolteamsavedupto9millionUSDduringcontractnegotiationandclaimresolution.Sheholdsamaster’sdegreeinInternationalProjectManagementfromGlasgowCaledonianUniversity,Scotland.HercareergoalistopromotecleanenergyandtobepartofateamthatinspirestheVietnamesepeopletotransitionawayfromcoalandthermalenergy.KholoudBakryMaintenancePlanning&ReportingEngineer,LekelaPowerKholoudBakryholdsamaster’sdegreeinRenewableEnergyEngineeringfromtheBritishUniversityinEgypt.ShestartedhercareerintherenewableenergyfieldbyjoiningtheArabProgramforSustainableEnergyYouthwiththeRegionalCenterforRenewableEnergyandEnergyEfficiency.KholoudjoinedLekelainearly2020,workingontheconstructionofLekela’sutility-scale250MWwindpowerproject,WestBakrwindfarminEgypt.SheiscurrentlyworkingonsiteastheMaintenancePlanningandReportingEngineerforWBWFwithafocusonmonitoringtheperformanceofthefacilityduringitsoperationalphase.Profiledparticipantsfromthe2022cohortCaseStudy:WomeninWindFOCUSONOFFSHOREWINDGWEC.NET70FocusonoffshorewindAsascalable,affordableandcommerciallyavailableenergytechnologywiththecapacitytoproducetremendousamountsofpower,offshorewindhasthepotentialtorapidlydisplacefossilfuels–deliveringeconomicgrowthandbolsteringenergysecurity.Offshorewindalsoopensuptheopportunitytoscaletheproductionofgreenhydrogenandpower-to-X,therebyaidinginthedecarbonisationofenergy-intensivesectors.Asamajorsourceofgreenjobs,frommanufacturingofturbinecomponentsthroughtoinstallationandoperation,offshorewindisincreasinglyseenasapositiveeconomicdriver.In2021,GWECandIRENAsignedaUNEnergyCompact,pledgingtoworktogethertodeploythe2,000GWofoffshorewindneededby2050toreachnetzero.1Thisrequiresahugeupsurgeininstallations,with35GWofoffshorewindtobeaddedannuallyinthecomingdecade,startingfromaglobaltotalofjustover60GWtoday.OnlyChinahassofarshowntheabilitytodeliveroffshorewindatthisscaleandspeed.Alongsidenet-zerotargets,manycountriesaresettingspecificoffshorewindtargets–withatleast16governments2settingorincreasingthemsincethe2022editionofthisreport.ThisincludessubnationaljurisdictionsliketheAustralianstateofVictoria(9GWby2040)andtheCanadianprovinceofNovaScotia(5GWby2030).InSeptember2022,energyministersfromtheninemembersoftheNorthSeasEnergyCooperation(NSEC)agreedtoreachatleast260GWofoffshorewindcapacityby2050.Chinatargets100GWby2025,200GWby2030and1,000GWby2050.SouthKorea’s10thBasicPlan,releasedinDecember2022,targets14.3GWby2030.Despitesettingsuchambitioustargets,countriesandgovernmentsarestillstrugglingtoturnthemintoactionatthespeedneededtofueltheglobalenergytransition.Offshorewindisacomplexinfrastructurerequiringdetailedknowledgeandexperienceofrobustmarinegovernanceframeworks,electricitymarketdesign,andsupplychainandindustrialpolicy.GWECobservesthatmanymarketsarestilllackingadequatepolicyandregulationtofacilitateoffshorewinddevelopment.Atthesametime,thereisagreatdealofglobalbestpracticetolearnfrom,especiallythroughpublic-privatepartnerships,tohelpnascentandemergingmarketsspeeduptheregulatoryprocess.Therehavebeensomenotableachievementsinanumberofemergingoffshorewindmarkets.AustralialauncheditsfirstoffshorewindleasingroundintheGippslandarea.TheUSmarketcontinuestoexpandrapidly,withthelandmarkInflationReductionAct(IRA)heraldinganeweraintheinternationalraceforoffshorewindandagreeneconomy.Withanewgovernmentinplace,Brazilismakinggreatstridesinestablishinganoffshorewindindustry(seepage84).Meanwhile,offshorewindinIndiaismovingforwardrapidly(seepage87).Offshorewind:turningtargetsintoturbines1.UNEnergyCompact2.SouthKorea,China,Victoria,NovaScotia,Belgium,Denmark,France,Germany,Ireland,Luxembourg,theNetherlands,Norway,Sweden,Portugal,NewJersey,LouisianaGWECGLOBALWINDREPORT202371FocusonoffshorewindProgresshasbeenlessmarkedelsewhere.Vietnam,with599GWofoffshorewindpotential,facesmajorpolicyuncertaintyasthePowerDevelopmentPlan8(PDP8)targeting7GWofoffshorewindby2030remainsindraftformsinceitsreleaseinMarch20213.Vietnam’sMinistryofIndustryandTrade(MOIT)isseekingtodevelopanauctionframeworkforoffshorewindbutregulationsonsitesurveyingandmarinespatialplanningareunclear.Inthepastyear,thePhilippinesliftedrestrictionsonforeignownershipinrenewableenergyandawardedmorethan50windenergyservicecontractsformorethan40GWofoffshorewindcapacity.However,thegovernmenthasyettodrafttherulesandregulationsgoverningtheactivitiesofoffshorewindfarms,frompre-developmenttooperation.MorematuremarketslikeJapan,TaiwanandSouthKoreahavebasicpolicyframeworksthatenabletheinitialdeploymentofoffshorewindprojectsbutlackrobustpolicy,predictableprojectpipelinesandthepolicyinfrastructureformassivescale-up.TherewerehighhopesforJapanfollowingthelaunchofitsFirstVisionfortheOffshoreWindPowerIndustryin2020.Ithassincestarteddrawingoutdesignatedseaareasthatwillbededicatedforgeneralauction.However,concernshavebeenraisedaboutthetransparencyoftheselectioncriteriafortheoffshoretender,compoundedbylengthyEnvironmentalImpactAssessment(EIA)timelines,largelystemmingfromlocalfishingcommunityresistance.4GWECwelcomesthegovernment’sintentiontomovetoacentralsystemofallocationandstandsreadytosupporttheseefforts.Taiwan’sRound3.1washighlycontestedwithsevenoffshorewindprojectsbeingawardedtoninedevelopers.However,concernspersistaboutauctiondesign,3.GlobalWindReport(GWEC,2022)4.Japan’sOffshoreWindFacesHighRisksontheHighSeas(BNEF,2019)GWEC.NET72Focusonoffshorewindincludinganunrealisticallylowpricecapandpoorflexibilityintermsofthelocalisationrequirement.Vestasrecentlyinvested300millionUSDinSouthKorea5,confirmingthecountry’sincreasingattractivenessasthenexthigh-potentialoffshorewindmarket.Despitearelativelymaturesupplychain,SouthKoreahasyettofinaliseaone-stop-shop(OSS)billthatwouldtrulykickstartoffshorewinddevelopment.PublicprivatepartnershipswillacceleratedeploymentAcceleratingoffshorewindgloballyatthescalerequiredtodeliverontheenergytransitionwillrequireunprecedentedeffortsfrombothgovernmentsandtheprivatesector,workingtogetherinpartnership.Asthetestbedoflarge-scale,commercialoffshorewinddeployment,Europehasenabledtheindustrytoacquireconsiderableknowledgeandexpertise.Thecumulativeoffshorewindexperiencewilladvanceacrossavarietyofstructuresincludingregions,statesandcountrieswithdifferentdemandprofilesandgrowthaspirationsasmoreandmoreareaslooktobuildtheiroffshorewindcapacity.Thiscallsforinitiativesthatfacilitateskillsandknowledgetransfer,andfornationalgovernmentstomoveawayfrom‘businessasusual’approaches.Strengtheningcollaborationthroughpublic-privatepartnershipsisthekeytoclosingthegapbetweenrealityandambitionbybuildingonexistingindustrystrengthtounlocktheworld’soffshorewindpotentialandenableglobalscale-up.TheUK’sOffshoreWindSectorDeal6isanattractivemodelthatbringsthegovernmentandindustrytogether,eachwithclearrolesandresponsibilities,toovercomechallengestooffshorewinddevelopment.Thesectordealsetsoutcollaborationacrossareassuchassupplychaingrowth,systemintegration,skillsandfutureworkforce.TheOffshoreWindGrowthPartnership7sitsalongsidethesectordealasanindustry-fundedlong-termbusinesstransformationprogrammethatpromotescollaborationacrossthesupplychaintoimproveproductivityandfacilitatessharedgrowthopportunitiesbetweendevelopersandthesupplychain.TheGlobalOffshoreWindAlliance(GOWA)8,aglobaldiplomaticinitiativelaunchedatCOP27byDenmark,IRENAandGWEC,aimstocreateamulti-stakeholdercommunitytoachieve380GWby2030andbeyond(seepage79).ConditionsforacceleratingoffshorewinddevelopmentIndustryandgovernmentscanworktogethertounblockbottlenecksandaccelerateoffshorewinddeploymentthroughexistingtechnologiesandrobustpolicyframeworks.Industryandgovernmentscanworktogethertoacceleratedeploymentthroughexistingtechnologiesandrobustpolicyframeworks5.https://www.koreaherald.com/view.php?ud=202301190002186.https://www.gov.uk/government/publications/offshore-wind-sector-deal7.https://owgp.org.uk/8.https://www.irena.org/Energy-Transition/Partnerships/GOWAGWECGLOBALWINDREPORT202373GWEChasidentifiedsomeurgentnextstepsthatwerecommendgovernmentstakeiftheyaretotakefulladvantageoftheenergyindependenceandsocioeconomicbenefitsthatoffshorewindcanbring.PermittingGlobally,offshorewindprojectstypicallytakeuptonineyearstomovefromearlydevelopmentstagetofullcommissioning9.Thebulkofthistimeisspentinthepermittingandconsentingstage,withtimelinesstretchingevenfurtherwhentherearebarriersordelaysinthepermittingprocess10.Generally,oncepermitted,large-scaleoffshorewindprojectscanbeconstructedveryquickly–typicallyintwoyears,dependingonprojectsize.11Doneright,effectivepermittingregimescanunlocksignificantamountsofoffshorewindcapacity,enablingittocontributetoeconomicgrowth,aswellastotheprovisionoflarge-scale,homegrowncleanelectricity.Holisticapproachestopermittingcanalsohelpcapturebenefitsandopportunitiesrelatedtobiodiversityandnatureconservation,ensuringthewindindustrycontinuestobealeaderindeliveringpositivesocioeconomicoutcomesforallcommunities.Effectivepermittingreliesonstreamlinedregulatoryframeworksandacoordinatedapproachwithinacountry,includingmodelslikeaanOSSapproach,theopen-doorscheme,andfast-trackprocedures.Establishingasinglecontactpointwillensureasmoothandadministrativelyleanprocessfromconsentingthroughtodecommissioning.TheconceptofanOSShaslongbeenusedinmatureEuropeanmarketsliketheUKandtheNetherlands.LearningfromEuropeanbestpractices,othercountriesarenowstartingtoadoptthisapproach.In2022,BrazilintroducedanOSSsystemthroughaninformationportalthatmanagesoffshoreareasusedforpower.12SouthKorea’sNationalAssemblyhasbeendiscussingaproposedOSSBill13tomakeprogressonthe9.GWEC,FivePointPlan(2022)10.GWEC’sStatementonImplementingVietnam’sPDP8TargetandNetZeroCommitment(2022)11.JointStatementbyGWECandtheGlobalSolarCouncilattheG20InvestmentForumonEnergyTransition(2022)12.OrdinanceN.3of19October2022,https://www.in.gov.br/en/web/dou/-/portaria-interministerial-mme/mma-n-3-de-19-de-outubro-de-2022-43775612613.SpecialActonOffshoreWindPowerDevelopment(SAOWPD)FocusonoffshorewindGWEC.NET74Focusonoffshorewindcurrentsystem,whichrequiresoffshorewinddeveloperstospenduptotenyearsorlongerconsulting29piecesoflawacross10ministries,accordingtotheSFOC14.InVietnam,anOSSmodelhasbeenmooted,groundedintheNationalSteeringCommitteeonMarineEconomicDevelopmentestablishedin2020,chairedbythePrimeMinister.15Fast-trackpermittingproceduresarealsohelpful.InDecember2022,theEuropeanCouncilagreedonacceleratedpermittingrulesforrenewablesintheREPowerEU.16Theupdatedpolicycreatesdedicated‘go-to’areasforrenewablesincludingshortenedandsimplifiedpermittingprocessesinareaswithlowerenvironmentalrisks.Forrenewablego-toareas,theCouncilagreedthatpermit-grantingprocessesshouldnottakelongerthanoneyearforonshore–andtwoyearsforoffshore–renewableenergyprojects,tobeextendedbyuptosixmonthsinextraordinarycircumstances.LeasingAsignificantbarrierfortheglobalwindindustryisascarcityofsites:seabedallocationisrarelylinkedtooffshorewindorclimatetargets,leadingtooverheatedseabedmarketsinsomecountriesorregions,asaresultoflengthy,decentralisedapproachestoseabedallocationandconstrainingauctioncaps.The‘lumpy’procurementthatresultsfromthisapproachcanlimitsupplychaingrowth.Mostjurisdictionsalsofailtoconsidertheenvironmentalimpactsfromcompetingusesoftheseainaholisticway.Intheabsenceofastrategicapproachtospatialplanning,windprojectscanSeabedallocationisrarelylinkedtooffshorewindorclimatetargets,leadingtooverheatedseabedmarkets14.SFOCisaSeoul-basednon-profitorganisationfocusedonclimateactionandenergytransition15.Do,T.N.,Burke,P.J.,Hughes,L.,&Thi,T.D.(2022).PolicyoptionsforoffshorewindpowerinVietnam.MarinePolicy,141,105080.https://doi.org/10.1016/j.marpol.2022.10508016.https://www.consilium.europa.eu/en/press/press-releases/2022/12/19/repowereu-council-agrees-on-accelerated-permitting-rules-for-renewables/GWECGLOBALWINDREPORT202375Focusonoffshorewindbedelayed,creatingbottleneckstogrowthandtotheachievementofclimatetargets.GWECwouldurgegovernmentslookingtoestablishtheirfirstleasingprocesstoconsidertheshort-andlong-termtrade-offswhenitcomestoleasingfeesandallocation.Uncappedcompetitiveallocationofleases,forexample,mayresultinhighershort-termrevenuesforleasingauthorities,buttothelonger-termdetrimentofelectricityconsumers.Uncappedcompetitiveallocationmayalsonotcontributetomoreholisticsupplychaingrowthoutcomes.IntheUK,TheCrownEstate,whichownstheterritorialseabedoutto12nauticalmilesoffEngland,WalesandNorthernIreland,islegallyrequiredtoachieve‘bestconsideration’foritsdealings.Thecompetitivebiddingapproach,however,raisestheconcernthatadditionalcostswillfindtheirwayintopricespaidbyconsumers.GWECwouldinsteadencourageemergingmarketstolooktowardsScotland’sScotWindleasingmodel,wherebiddingfeeswerecappedto100,000GBPpersquarekilometre.TheScotWindprocessincludesamandatorySupplyChainDevelopmentStatementtodrivelonger-termsupplychaininvestment.Deployingoffshorewindatthespeedandscalerequiredfortheenergytransitionwillnecessitatenewapproachestoleasingthatprioritisevolume.AnintriguingnewmodelhasemergedfromDenmark,wheretheOpenDoorpolicywouldallowdeveloperstoidentifypotentialsites,undertakepreliminaryinvestigationsandsecuregridconnections.Atthetimeofwriting,theschemehadregrettablybeensuspended.TheindustryhopesthattheDanishgovernmentreconsiders.HydrogenGreenhydrogenandpower-to-Xcandrivethetransitionintransportandthehard-to-abatesectors.Greenhydrogensolutionscoulddecarboniseironandsteel,long-haulaviationandshipping.Asrenewableelectrificationandstoragetechnologiescontinuetoadvance,greenhydrogenhasthepotentialtobeemployedacrossallsectors.Withaccelerateddeployment,itscostscanbecompetitivewithbluehydrogenbytheearly2030s.Greenhydrogenalsohasgreatexportpotential.Whilethecommercialisationofthistechnologyisstillinitsearlystages,todate35countrieshaveahydrogenplanand17arepreparingone,accordingtoBNEF.IRENAidentifiesChina,theEU,India,Japan,SouthKoreaandtheUSasearlyadopters.InAustralia,greenhydrogenisatthecentreofglobaldecarbonisationstrategies.InpreparationforAustraliatobecomeamajorhydrogenexporter,thegovernmentpublishedinearly2022aNationalHydrogenStrategy.Withavisiontobeattheforefrontofrenewablehydrogenproductionandexport,theQueenslandStateGovernmentlaunchedtheHydrogenIndustryWorkforceDevelopmentRoadmap2022-2032attheAustralianCleanEnergySummitinJuly2022.Offshorewindhasacentralroletoplayingreenhydrogenproduction.In2022,theworld’sfirstoffshoregreenhydrogenproductionplatformwasinauguratedinFrance.Theelectrolyser,suppliedbyPlugPoweranddevelopedwithLhyfe,isthefirstcapableofoperatingonafloatingplatform.17ItwilluseelectricitysuppliedbyBWIdeol’sfloatingoffshorewindturbineFloatgen,installedattheoffshoretestsitein2018.Auctiondesign(non-pricecriteria)Afteradecadeofcostreductions,offshorewindisataninflectionpointwithahighlycompetitiveLCOEthatisnow3USD/MWhbelowthatofcoaland18USD/MWhbelowthatofgas.18Whileachievingaffordableelectricityremainsthekeypriority,itisalsoimportantfortheindustrytoscaleupwhilemaximisingtheoverallindustrialandsystemvalueforoffshorewind.TheintroductionoftheIRAintheUStodrivedomesticmanufacturingcapability,regionaltransmissionandinvestmentisheraldinganeweraintheinternationalraceforoffshorewind.Thebeneficialchangestothetaxcreditavailable,whenDeployingoffshorewindatthespeedandscalerequirednecessitatesnewapproachestoleasingthatprioritisevolume17.Lhyfe(2022)inauguratesworld’sfirstoffshorerenewablehydrogenproductionpilotsite18.2H2022LevelizedCostofElectricityUpdate(BNEF)GWEC.NET76implementedsuccessfully,willcreatearobustdomesticsupplychaintoenableprojectdevelopmentinthelongterm.Onewaytoencourageeffectivesystemdesign,andtocapturethegreatersocioeconomicvaluethatoffshorewindbrings,istograduallymoveawayfromajust-on-priceauctionmodeltoadesignthatincorporatesnon-pricecriteriathatincentiviseinnovationandsupplychainbuild-up.Ahealthyauctionmechanismshouldaccountforthetotalnetimpactsonsocietyandnotfocusonpricealone.Theuseofminimumlocalcontentrequirements(LCRs)asaformofnon-pricecriteriahassubstantiallyincreasedinrecentyearsasgovernmentsclaimthemeasurecanhelpdevelopdomesticmanufacturingcapacityforrenewabletechnologies,createlocaljobsandencouragetechnologyinnovation.Australia,Ghana,Japan,Oman,TaiwanandtheUKhaveimplementedgreenLCRssince2015.19InJapan,LCRsaccountedfor40outofthe120pointsFocusonoffshorewind19.OvercomingBarrierstoInternationalInvestmentinCleanEnergy(OECD)GWECGLOBALWINDREPORT202377availableintheprojectfeasibilityevaluationfortheirfirstoffshoretenderroundin2020.Oneoftherequirementswasatrackrecordofengagementwithkeystakeholdersandimpactonlocalandnationalemploymentandmanufacturing.InTaiwan,stringentLCRsrequireddeveloperstolocallyprocure26‘keydevelopmentitems’foratleast60%ofaproject’sproposedcapacity.Withoutaclearimplementationpathwayandsufficientsupportmechanismsfromgovernments,LCRscanbecounterproductivebydrivinguppriceswhilehamperingcompetitionandinnovation.Localvalueisbestcreatedthroughnaturallylocaljobs,particularlyintransport,constructionandO&M–astheservicingofwindfarmscreatesjobsoverthefullprojectlifetimeof20+yearswhilejobcreationinmanufacturingrequiresamarketwithlong-termstability.Includingnon-pricecriteriashouldenableashiftfromfocusingonlowest-priceprojectstorewardingprojectdeliverywithhighestvalue.20Theuseofthesecriteriarecognisesthewidersocietalvaluethatwindenergybrings.Non-pricecriteriacanbeprioritisediftheyfallunderthreecategories21:sustainabilityandbiodiversity;systemintegrationandinnovation;supplychaindevelopmentandbenefitstocommunities.Selectedcriteriashouldbe:lClearandobjectivetoidentifytherightprojectwithoutbeingdiscriminatoryagainstanygroupofstakeholders.lTransparentandmeasurabletoavoidintroducingadditionaladministrativeprocessesandcomplexbiddingactivities.lReasonableandpracticaltobuildoncurrentindustrycapabilitieswithoutfurtherinflatingthecostordelayingprojectdevelopment.In2022,theGermanParliamentadoptedanewoffshorewindlaw(WindSeeG)establishingtwotypesofauctions,oneofwhichinvolvesnegativebiddingwithnocapsontheamountsdevelopersbid.Theindustryseesthischangeasdoingmoreharmthangood,asuncappednegativebiddingmeansadditionalcostsforelectricityconsumersandthesupplychain.22Non-pricecriteriaareincreasinglyacceptedinEurope,withallsuccessfuloffshorewindauctionsin2022includingnon-pricecriteriaaspartoftheevaluation.SiteVIIoftheHollandseKustWest(HKW)tenderplacedahighpriorityonnon-pricecriteriaasthetenderfocusedonhowwellthewindfarmcanbeintegratedintotheDutchenergysystem.SiteVIofHKW,ontheotherhand,focusedonbiodiversity.23Ultimately,non-pricecriteriainauctiondesignshouldencouragehealthycompetitionandinnovationwhileenablingrapidscale-upofoffshorewinddevelopmentandtherecoveryofcosts.FloatingoffshorewindWith80%oftheworld’soffshorewindresourcepotentialinareaswithawaterdepthofmorethan60metres,from2030weexpecttoseearapidaccelerationoffloatingoffshorewind.24Manyoftheemergingoffshoremarkets,suchasVietnamandthePhilippines,arepredominantlyfloatingmarkets.Maturemarketsareincreasinglylookingatfloatingoffshoreastheyrunoutofseabedareassuitableforfixed-bottomoffshoreprojects.Non-pricecriteriainauctiondesignshouldencourageinnovationwhileenablingrapiddevelopmentFocusonoffshorewind20.https://www.weforum.org/projects/system-value21.https://windeurope.org/policy/position-papers/windeurope-position-on-non-price-criteria-in-auctions/22.https://windeurope.org/newsroom/press-releases/negative-bidding-in-german-offshore-wind-law-threatens-supply-chain/23.https://windeurope.org/newsroom/press-releases/europes-latest-offshore-auction-mainly-using-non-price-criteria-is-a-success/24.FloatingOffshoreWind-AGlobalOpportunity(GWEC)GWEC.NET78GWECmarketintelligenceforecaststhefloatingoffshorewindmarkettoreach16.5GWby2030.Seabedandsubsidyauctionsplannedfor2023showthatthesectorispreparingforthenextstepupinscale.Anumberofcountriesarealsojoiningtheracetoestablishthemselvesasaglobalfloatingwindsupplyhub.InAsia,Japan’s‘ProgramforPromotingInvestmentinJapantoStrengthenSupplyChains’isaninitiativethataimstoestablishamanufacturingbaseforoffshorewind.Korea’s300millionUSDMoU25withleadingwindturbinemanufacturerVestasisasimilarsteptowardssolidifyingKorea’spositionasoneoftheoffshoresupplychainhubsintheregion.Taiwanhasupdateditsfloatingoffshorewinddemonstrationprojectguidelinestoincreaseprojectcapacityfrom100MWtomorethan200MW.DeveloperswithexistingfloatingwindsitesarepreparingtoentertheRound3.2auctionscheduledlaterthisyear.InEurope,morethan60millionGBPofpublicandprivateinvestmentwillbeusedtodevelopfloatingtechnologiesandtoplacemoreturbinesacrosstheUK’scoastlines.Inearly2022,theScotWindauctionaloneawardedmorethan13GWoffloatingoffshorewindsites,representingmorethanhalfoftheexistingoffshorewindcapacityintheUK.26Francewastoannouncethewinnerofa250MWfloatingwindprojectinSouthBrittanyatthetimeofwriting.Floatingoffshorewindislikelytorapidlybringdowncosts,creatingtheopportunitytoopenupmoremarkets.Theindustrycanalsouseexistingmaritimeandpetrochemicalexpertisetotransitionintofloatingoffshorewind.Floatingwindwillneedtomovetoalargerscale,andthefirstcommercialprojectwillbekeytosettingamodelthatenablesfuturefloatingoffshorewindprojectdeployment.AsitbringsdowncostsfloatingoffshorewindwillcreatetheopportunitytoopenupmoremarketsFocusonoffshorewind25.https://www.koreaherald.com/view.php?ud=2023011900021826.https://www.ft.com/content/d894424c-6d29-497d-b728-2083a5d038e2GWECGLOBALWINDREPORT202379Focusonoffshorewind:GOWAThegovernmentofDenmark,IRENAandGWECfoundedtheGlobalOffshoreWindAlliance(GOWA)inSeptember2022todrivetheuptakeofoffshorewindthroughpoliticalmobilisationandthecreationofaglobalcommunityofpractice.GOWAaimstocontributetoachievingatotalglobaloffshorewindcapacityofatleast380GWby2030and2,000GWby2050,with35GWbeingdeployedonaverageeachyearthroughthe2020sandaminimumof70GWannuallyfrom2030.GOWAenvisionsoffshorewindmakingasignificantcontributiontotheenergytransitionandtheachievementofthesustainabledevelopmentgoalsthroughlarge-scalerenewablepowergenerationbenefitingregions,nationsandcriticalsectorssuchasindustryandtransportation.Tobenefitfromthesubstantialpotentialandopportunitiesderivingfromoffshorewinditispivotalthatgovernments,privatesectoractors,internationalorganisationsandotherrelevantstakeholdersworktogethertoremovethebarrierstoscalingupinvestmentandfinance.GOWAisamulti-stakeholder,diplomaticandworkstreambasedinitiativethathaspublicprivatepartnershipasitsguidingprinciple.GOWAwillworkto:lRaiseambitiononoffshorewindamongstgovernmentsandotherpublicandprivatestakeholders.lSupportthecreationofpolicyframeworksandefficientoffshorewindvaluechainstobringnewandexistingmarketstomaturitythrough,forexample,thesharingofbestpracticesandcapacitybuilding.lCreateaninternationalcommunityofpracticetodriveactiononoffshorewinddeploymentasakeytoachieving1.5Cpathways.Tosupportcountriesastheyseektodevelopoffshorewind,GOWAwilladdressthemajorbuildingblocksforthesector,suchasframeworkconditions,financialde-risking,systemintegrationandeconomicbenefits.Theseareallimportantdriverstoreducecosts,ensurecompetitivemarketpricesandcreateprojectpipelinesatcountryandregionallevel.GOWAactivitieswillbebasedonademand-drivenapproach.TheGlobalWindEnergyAlliance(GOWA)AustraliaBelgiumColombiaDenmarkGermanyIrelandJapanTheNetherlandsNorwayPortugalSpainStLuciaUKUSAAtthetimeofwriting,GOWAhas14countrymembersGWEC.NET80Focusonoffshorewind:OEPTheOceanEnergyPathway(OEP)isalarge-scale,multi-yearprogrammeforcontributingtotheaccelerationoftheglobalenergytransition.OEPaimstorampupthedeliveryofoffshorewindthroughcollaborationbetweenindustryandcivilsocietythatunlocksthepotentialofocean-basedrenewableenergyinnewandunderdevelopedmarkets.TheOEP’sfundamentaltenetisthatsustainablescalingupofthesectorwillonlycomefromhigh-quality,locallyappropriatepolicyandregulationthatencouragesnature-positiveoutcomes,deliversforlocalcommunities,andenableswidereconomicdevelopment.AtrustedpartnerforallstakeholdersBeingindependentofindustry,theOEPisatrustedpartnerthatworkswithgovernments,investors,communitiesandNGOstobuildacompetitiveandsustainableoffshorewindsector.Itskeyaimistoproactivelyaddressthemajorchallengesoffshorewindfacesthroughthreethematicpillars:marketdesignandsupplychains,limitedgovernmentcapacity,andprovidingbenefitsfornatureandcommunity.Marketdesign:howpolicydrivesinvestmentThedevelopmentofdomesticsupplychains–atrendincreasinglyarisingfrompoliticalnecessity–canalsobecomealimitingfactorfortherapidexpansionofoffshorewindtonewcountries.Governmentsandlocalindustrymustworktogetheronnewpolicyinstrumentsandstrategicsupportindevelopingtheirownsupplychainsinawaythatdoesnothinderoffshorewinddevelopment.Thewindindustryneedsconfidenceinpolicymeasurestodriveincreasedinvestmentinmanufacturing,infrastructureandtalent.Unlessthecorrectindustrialpolicychoicesaremade,successforoffshorewindwillbeseverelyconstrained.Governmentcapacity:whyappropriateregulationmattersDeliveringoffshorewindisacomplexpolicydesignchallengefordevelopedbureaucracies–andanevengreateroneforcountriesthatlacktheregulatoryandinstitutionalunderpinningstobuilddeliveryframeworks.Thisaddsuncertaintyandstretchesoutwaittimesfordevelopers.Newoffshorewindmarketsneedahugeamountoflocallyappropriateandfullyalignedpolicyandregulationifthesectoristoscaleuptomeetitstargets.Dealingwithsocio-politicalandecosystemimpactsSocio-politicalchallengesincreasinglythreatenprojectviability.Offshorewindoperatesinacomplex,multi-stakeholderlandscapewherethetechnologyisoftenpoorlyunderstood,engenderingconflictthatcausesadditionalcostsanddelays.Offshorewindcompeteswithexistingoceanusers–sectorsthatmayfeeltheirprospectsarethreatenedbyocean-energytechnologies.Theecosystemimpactsofoffshorewindprojectsarealsopoorlyunderstood,especiallyinnewmarkets,leadingto‘green-on-greenconflict’whereconservationNGOspushbackagainstwindprojects.OceanEnergyPathway(OEP)GWECGLOBALWINDREPORT202381Focusonoffshorewind:OEPAcceleratingocean-basedrenewableenergyrequiresnewapproachestodeployment,includingasustainableapproachtooceanstewardship,toavoidtheindustrybeingcaughtinthecrossfireofwiderconversationsaroundoceanmanagement.Innewmarketsespecially,theoffshorewindindustryneedstoestablishearlypartnershipswithconservationgroupsandlocalcommunitiestoshapeemergingregulationsandpoliticalnarratives.HowtoacceleratedeploymentInthemediumtolongterm,thewindindustryandinvestorsmaybeabletocontinuetosingle-handedlybringoffshorewindtoscaleinseveralmarkets.Butgiventhehugeroleoffshorewindmustplayindisplacingfossilfuelsandgettingusontrackfora1.5Cworld,wecannotwaitforthemarketalonetoact.TheOEPknowsthatwhiletherearecommonelementstobuildingasuccessfuloffshorewindsector,itisessentialtoworkwithintheuniqueeconomicandpoliticalcontextsofeachcountry.Forthisreason,itfocusesonanumberofactionsthatarecrucialtosuccessfulprojectdelivery.ExpertiseandnetworkingBecausethewindindustryhassofardeployedandinvestedinthevastmajorityofoffshorewindprojects,theOEPoccupiesauniquepositiontoconveneandsupportallstakeholdersinthisarea.ItaimstoleverageitsexperienceandconnectionstosupportandcomplementtheworkofotherorganisationsincludingtheWorldBankandtheInternationalRenewableEnergyAgency(IRENA),aswellaspartnergovernmentsandtheoffshoresectoritself.TheOEPwillcreateanetworkofregionalexpertsthatcanworkwithgovernmentsandstakeholderstobuildknowledgeonoffshorewind.Servingasacatalystforlonger-termsystematicchange,theOEPintendstoprovideexpertswhocansitalongsideofficialsingovernments,ratherthanworkremotelyfromwithinlargeconsultancies.Thiswillallowustosupportlearninginsidenewcountrymarketsandaccelerategrowthinexpertise.TheOEPwillalsomakeanongoingefforttocreateand/orinvestinlocalnetworkstofacilitatedialogueandsharedworkingbetweenoceanandnatureNGOs,communitygroups,industrygroupsandgovernmentstakeholders.TheOEP’sstrategicapproachistofocusoncountrieswithsignificantcarbonfootprints,atriskoffossil-fuellock-in,andwithsignificantwindresourceswhilealsorespondingpragmaticallytocountry-specificambitions,evolvingpoliticsandeconomics.PrioritycountriesincludeVietnam,Indonesia,thePhilippines,Thailand,India,SouthKorea,Taiwan,Colombia,Brazil,JapanandSouthAfrica.Whiletherearecommonelementstoasuccessfuloffshorewindsector,itisessentialtoworkwiththeuniquecontextofeachcountryGWEC.NET82India●Annualtargetof8GWonshorewindtendereveryyearbetween2023and2030basedonasingle-stagetwo-envelopebidsystem.●MNREpublishedastrategypaperoutliningatendertrajectoryof37GWofoffshorewindby2030●IndiangovernmentandindustryseizingsupplychainopportunitiesEgypt●42%renewableenergyby2035withsupportofGreenCorridorInitiative●Installationsprojectedtorisefrom1.7GWto8GWby2030●Multi-GWscaleprojectsinearlystagesofdevelopmentChina●50GWofplannedinstallationsduringthe14thFive-YearPeriod(2021–2025)●Projectedannualinstallationsof70–80GWuntil2030●Localindustryreadytosupportannualinstallationsofapproximately15GWAustralia●Newnationalgovernmentsupportiveofonshoreandoffshorewinddevelopment●OffshoreElectricityInfrastructureRegulationsreleased●AnnouncedareasforoffshorewindinGippsland(Victoria)Brazil●Cross-partysupportforwindenergyasadriverofeconomicgrowthandjobcreation●ABEEólicaexpectsannualadditionsintheregionof3GWforonshorewindoverthenextdecade●OffshorewindandgreenhydrogenexpectedasadditionaldriversforwindenergydevelopmentSouthKorea●Windenergytargetincreasefrom2to34%,aspartofa30%renewablestargetby2036●Projected34GWofinstalledwindenergyby2036●Newgovernmentimplementinga'OneStopShopBill'tofast-trackprojectdevelopmentStronginstalledcapacityincrease,newambitioustargetsand/orpolicyimprovementAdequatetargetsandpolicies,butnotmatchedbyexpectedprogressLackofprogressorregressionTunisiaOffshorewindby205030GW60GW300GW17GW28GW9GW15GWWindenergyby2030Victoria-offshorewindby2040NofederaltargetsWindenergyby203045%Windenergyby20305%Offshorewindover2026–2035(1.5GW/yr)10GWOffshorewindtargetsof10GWby2030and30–45GWby2040Renewableenergyby2030Offshorewindby2030Offshorewindby2030100%Renewablepowerby2030100%Renewablepowerby2030MongoliaAustraliaIndonesiaThailandIndiaChinaKazakhstanUzbekistanSaudiArabiaEgyptAlgeriaMauritaniaBrazilArgentinaChilePeruColombiaCostaRicaMexicoUnitedStatesCanadaNigeriaMoroccoEUUKSenegalSouthAfricaEthiopiaKenyaTanzaniaVietnamPhilippinesTaiwanSouthKoreaJapanUruguayGhanaNambiaMozambiquePolicyheatmapMARKETSTOWATCHGWEC.NET84Marketstowatch:BrazilTherearereasonstobeoptimisticabouttheprospectsforwindenergyinBrazil,followingyearsofsolidindustryperformanceandpositivepolicydevelopments.In2022,onshorecapacitysurpassed24GW1afteranotherstrongyearforinstallations,whileexcitementovertheprospectsforoffshorewindreachedunprecedentedheights.UndertheParisAgreement,Brazilhascommittedtoreducinggreenhousegasemissionsby37%from2005levelsby2025and50%by2030.AttheCOP26climatesummitinNovember2021,Brazilalsoannouncedazeroillegaldeforestationtargetby2030alongsideanationalhydrogenstrategy.2NewlyelectedPresidentLuizInácio‘Lula’daSilvasaidduringhiselectoralcampaignthathisgovernmentwouldplaceclimatechangeandtheenergytransitionatthecoreofitspolicies,andsomeconcretesignsinthisdirectionhavealreadybeensent.Brazil’snewfederaladministrationisexpectedtoprovideincentivesfortheenergytransitionwhilebalancingenergysectorprioritieswithabroadenvironmentalagenda.Thisrepresentsacrucialstrategicopportunityforthecountry,accordingtoBrazil’swindenergyandnewtechnologiesassociationABEEólica,providedtherightregulatoryandeconomicinfrastructureisputinplacerapidlytotriggerwindindustryinvestmentinBrazilinpreferencetoothercountries.Asexpected,underBrazil’snewpoliticalleadership,state-ownedenergygiantPetrobrashasalreadyannouncedthatitwillfullyre-entertherenewablessector,withoffshorewindandgreenhydrogenbeingparticularlyimportantpriorities.Signallingthecompany’srenewedambition,on7March,newPetrobrasCEOJean-PaulPrates–along-termadvocateforwindenergyandrenewables–announcedplanstoconsiderdevelopingsevenoffshorewindprojectswithatotalcapacityof14.5GWincollaborationwithNorway’sEquinor.Brazil’sGDPisestimatedtogrowby2.8%in2022,whichalongsideacontinueddrivetowardselectrificationisfocusingmindsontheneedtoredoubleeffortstopromoterenewableenergydevelopments.Brazilhasanenviablerenewableenergymatrix,withwindpowerplayingaveryimportantroleinsecuringthecountry’senergysupplywhileofferinglowpricesforconsumersandcontributingtodecarbonisation.OfficialdataconfirmedthatwindenergysitsinsecondplacebehindhydrobyshareofelectricitygenerationinBrazil,whilealsoprovidinganimpressivelistofsocioeconomicbenefits.AnABEEólicareportanalysingtheimpactofwindenergyontheBrazilianeconomyfoundthat,foreveryBrazilianReal(BRL)investedBrazil’sgovernmenttobetonhydrogenandoffshoreaswindrevolutiongathersmomentum1.https://ABEEólica.org.br/wp-content/uploads/2023/01/2023_01_InfoVento29.pdf2.https://www.iea.org/countries/brazil3.https://www.oecd.org/economy/brazil-economic-snapshot/GWECGLOBALWINDREPORT202385Marketstowatch:Brazilinwindfarms,thereisa2.9BRLupliftonGDP.4ThewindenergysectorinBrazilisconsolidatingitsgrowthunderthefreeelectricitymarketenvironmentandsawafurthershiftawayfromregulatedauctionstowardscorporatePPAsin2022,givingitaddedresilience.ABEEólicaexpectsannualadditionsintheregionof3GWforonshorewindoverthenextdecade–buthopesthiswillprovetobeaconservativeestimate.Itisparticularlyoptimisticabouttheprospectsforanewandverypromisingoffshorewindenergymarketastheregulatoryfoundationsforitssuccessarebeinglaid.Offshorewind:greatexpectationsEvenbeforethecabinetofPresidentLulatookofficeon1January2023,theDirectorofEnergyDevelopmentattheMinistryofMinesandEnergy(MME),MarinaRossi,hadbeentalkinguptheroleofoffshorewindinthecountry’seconomicdevelopment,emphasisingtheimportanceofstreamlinedrulestofacilitatedeployment.5Witharound8,000kilometresofcoastlineblessedwithstrongoceanicwinds,Brazilhasthepotentialtoinstallmorethan1,200GWofoffshorewind,accordingtoastudybytheWorldBank.6Thisdwarfsthealreadyimpressive500GWthatABBéolicaestimatescouldbeinstalledonshore.Thepastyearsawaflurryofregulatoryactivityaroundoffshorewindpowergeneration.SinceFederalDecree10,946/2022–settingguidelinesontheuseofmaritimespaceandtheexploitationofnaturalresources–cameintoforceinJune2022,adraftbillonoffshoreenergyregulation(PL576/2021)startedmakingitswaythroughparliamentandtwoordinancesprovidedguidelinesontheuseofmaritimeareasandthecreationofaone-stop-shopforprojectlicensing.ThebillwasdraftedbyformerRioGrandedoNorteSenatorJeanPaulPrates–nowthenewlyappointedCEOofstateenergyincumbentPetrobras.Anoffshorewindenthusiast,hehasraisedexpectationsthatthecompanywillreviewitsstrategicplanfor2023-27toboostinvestmentinrenewableenergy,andoffshorewindspecifically.Asignificantshiftmaytaketime,butwithitsstrongwindsupplychainandwell-establishedoffshoreengineeringexpertise,Brazilcouldpositionitselfasaregionalleaderinanareawithseveralcountriespoisedtoinvestheavilyinoffshorewindenergy.For2023,ABEEólicaplanstocontinuetoworktowardstheestablishmentofasoundandconsistentregulatoryframeworkforoffshorewind,withthesupportofGWECandanindustrykeentoinvestinthecountry.Anothermajorboostforthesectorcouldcomefromgreenhydrogen,whichhasthe4.https://ABEEólica.org.br/wp-content/uploads/2022/02/Estudo-Braulio_final.pdf5.https://www.folhape.com.br/economia/ventos-fortes-nas-usinas-eolicas-contra-o-aquecimento-global/250189/6.https://www.worldbank.org/en/news/feature/2020/05/27/energia-eolica-offshore-brasil-esmapWithitsstrongwindsupplychainandwell-establishedoffshoreengineeringexpertise,BrazilcouldpositionitselfasaregionalleaderGWEC.NETStrap86potentialtopropeldemandtothelevelsrequiredbyhard-to-decarboniseenergy-intensiveindustries.AlthoughOECDprojectionsseeslowergrowthof1.2%in2023and1.4%in2024forBrazil’sGDP,7greenhydrogencouldbecomeacatalystforboostingrenewableenergydemand–andthecountry’seconomicfortuneswithit.ABEEólicasupportsanindustrialpolicyfocusingonthesynergiesbetweengreenhydrogenandwindenergy,andexpectstoengagepositivelywiththenewgovernmenttofast-trackitsprogress.Meanwhile,itexpectsthefirstoffshorewindtenderin2023andwasencouragedtoseethetechnologygainamentionintheBrazilianElectricityRegulatoryAgency’s(ANEEL’s)strategicplanfor2023-24.8Butitinsiststhatthecountryneedsabreakthroughindetailedoffshorewindpowerregulationtobecomeanattractiveenvironmentforinvestorsandenablethetechnologytotakeoffinitswaters.Investorshaveshownplentyofappetiteforthismarket,withtensofprojectapplicationsforatotalofmorethan170GWofoffshorewindpowercapacityalreadyfiledwiththeBrazilianInstituteoftheEnvironmentandRenewableNaturalResources(IBAMA).UnderitslatestTen-YearEnergyExpansionPlan(PDE),BrazilianenergyplanningagencyEPEforeseesrenewableenergyrepresenting48%ofthecountry’senergymatrixby2031.Brazil’soffshorewindsectormayonlybeinitsinfancybythatdate,butithasthepotentialtomakeamajormarkoverthefollowingdecade.9HavingbecomeLatinAmerica’sundisputedwindenergymarketleaderoverthepastdecade,withmorethan50%oftheregion’sinstalledwindcapacity,Brazilconfirmeditspositionin2022.ThechallengeforthefutureistoconsolidatepoliciesandestablishastrongregulatoryframeworkforoffshorewindandgreenhydrogeninordertoprovidetheappropriateconditionsforindustrytoinvestsothatBrazilcanleadthewaytoajustenergytransitionintheregion.Marketstowatch:Brazil7.https://www.oecd.org/economy/brazil-economic-snapshot/8.https://www.gov.br/aneel/pt-br/assuntos/noticias/2022/aprovada-agenda-regulatoria-com-15-temas-estrategicos-para-o-bienio-2023-20249.https://www.epe.gov.br/en/press-room/news/mme-launches-english-version-of-the-ten-year-energy-expansion-plan-pde-2031GWECGLOBALWINDREPORT202387Marketstowatch:IndiaGWEC.NETInthemidstofglobaluncertaintycausedbytheglobalCOVIDpandemic,theRussia-Ukrainewarandrecessionarypressures,India’scontinuedpoliticalstabilityhasprovidedstrongsupportforthecountry’sclimatecommitments.Indiahasprioritisedrenewableenergy,includingwindpower,initslong-termvisionfortransformationliftingexpectationsforawindsectorthatexperiencedaslowdownincapacityadditionsintherecentpast.1India’sCentralElectricityAuthority(CEA)projectsEx-Buselectricitydemandtogrow75%by2031-32from2021-22levels,and170%by2041–42.Demandisprojectedtoincreasebymorethan90%infouroutoftheeightwindieststatesbythestartofthenextdecade.TheWorldEnergyOutlook2022estimatesdemandtotriplebetween2021and2050.Indiaaspirestobea5trillionUSDdollareconomyby2025andaimstogrowmanufacturingGDP15-foldbetween2021and2047.Itisalsocommittedtoachievingnetzeroby2070.Renewableenergy(excludinglargehydro)alreadyrepresentsnearly30%ofIndia’sinstalledpowergenerationcapacity,at410GW,with10%ofthiscapacitybeingwindenergy.Thecombinedimpactofeconomicgrowth,net-zerogoalsandburgeoningelectricitydemandwillresultinarapidincreaseintheshareofrenewableenergyinthepowergenerationmix.Forwindpower,India’stargetistoachieveacumulative140GWofcapacityby2030.HowpolicyreformswillaccelerategrowthIn2022,Indiaawarded2.252GWofstandaloneand2.45GWofhybridwindcapacitythroughauctions.Itcommissionedatotalof1.8GWofonshorewindpowercapacity.3Recentpolicyreformsarelikelytofurtherboostdemandforwindpowerandacceleratecapacityadditionsoverthecomingyears.ThroughitsElectricity(LatePaymentSurchargeandRelatedMatters)Rules,2022,thegovernmentaimstocurbtheissueofdelayedpaymentshamperingthefinancialhealthofgreenpowergenerators.IthasalsolaiddowntheElectricity(PromotingRenewableEnergythroughGreenEnergyopenAccess)Rules,2022tosupporttheuptakeofgreenpowerandtheDraftNationalRepoweringPolicyforWindPowerProjects,2022totapopportunitiesforrepowering.TheMinistryofNewandRenewableEnergy(MNRE)hasoutlinedawind-specificrenewablepurchaseobligation(RPO)trajectoryto2030,withanannualtargetofan8GWonshorewindtendereveryyearbetween2023and2030basedonasingle-stagetwo-envelopebidsystem.Theplanistoharnessthemassivewindenergypotentialofeightwindystates:AndhraPradesh,Gujarat,Karnataka,MadhyaPradesh,Maharashtra,Rajasthan,TamilNaduandTelangana.Tosupportthedevelopmentofpowerevacuationandtransmissioninfrastructure,theCEAhaspublisheditstransmissionplanningreportfortheintegrationofrenewableenergy,including58GWofwindenergy–ofwhich10GWisoffshoreTamilNaduandGujarat–totheInter-State-Transmission-System(ISTS)by2030.However,theplannedinfrastructuremaynotbesufficienttoaccommodateMNRE’stargetof8GWperyear.CreatingamarketforoffshorewindIn2022,theMNREpublishedastrategypaperoutliningatendertrajectoryof37GWofoffshorewindby2030.TogetherwiththeDanishIndiaeyesglobalwindenergysupplychainopportunitiesasittargetsgrowthincapacityadditions1.https://eparlib.nic.in/bitstream/123456789/931974/1/17_Energy_27.pdf2.AsperIEA’sAdvancedPledgesScenario3.https://powermin.gov.in/en/content/power-sector-glance-all-IndiaGWEC.NETStrapEnergyAgency,italsopublishedaconceptualplanwithapipelineof15offshorewindprojects.Additionally,theCenterofExcellenceonOffshoreWindandRenewableEnergy,jointlysetupbytheDanishgovernmentandtheMNRE,publishedreportsonmaritimespatialplanningthatbuildonearlierFOWIND4andFOWPI5projects.CreatingamarketforoffshorewindinIndiademandsastrongpartnershipbetweenthegovernment,developmentfinanceinstitutions,commercialbanks,theoffshorewindindustry,andlocalcommunities.DevelopingIndiaasanattractiveoffshorewindmarketfurtherrequirestheintroductionofappropriatestandards,suchasenvironmentalimpactassessment(EIA)guidelines,andsupportforenergyofftakewhileensuringthecompetitivenessofoffshorewind.SeizingsupplychainopportunitiesRecentincreasesincommodityprices,coupledwiththeemergingimpactsofshrinkingsupplychainsinEurope,arepointingtoahugeopportunityforIndiaintheglobalwindenergysupplychain.India’sdomesticannualmanufacturingcapacitystandsat10-12GWforwindturbinegenerators.Indiaisalsotheworld’ssecond-largestmarketforgearboxmanufacturingandthesecond-largestsupplierofbladesandgeneratorsintheAPACregion.Tofurtherstrengthenitsleadershipinthewindmanufacturingsector,Indiamustputinplacearoadmapforaresilientsupplychainofrawmaterials–includingrareearthmetalsandnon-standardsteel–andforspecificjobssuchascastingandforging.Existingimportdutyreliefonequipmentandcomponentssuchasbalsawoodandpultrudedcarbonfibre,whichcannotbeproducedormanufacturedinIndia,mustcontinue.Micro,smallandmediumenterprises(MSMEs)playapivotalroleintheIndianwindmanufacturingsector.Goingforward,thegovernmentshouldconsidertargetedproduction-linkedincentivesforcompaniescurrentlyengagedintheonshorewindsector,andforthosewishingtogetinvolvedinoffshorewindmanufacturing.In2022,GWECIndiaconvenedasupplychainstakeholderroundtable,whichoutlinedhigh-impactopportunitiesforcatalysingwindpowergenerationandmanufacturinginthestateofTamilNadu.GWECalsopresentedasimilarscenariotothegovernmentofGujarat,alongsiderecommendationsonrepowering,offshorewind,robustmonitoringofutility-scalewindfarmsandtransmissionprojectstovariouscentralgovernmentagencies.IndiaisinauniquepositiontoleveragegrowingexportandinternationalserviceopportunitiesintheAPACandEuropeanregions.AstrategicsupplychainimpetusispivotaltoscalingupIndia’swindmanufacturingsector.PrimeMinisterNarendraModihascalledforIndiatobecomeadevelopedeconomyby2047.6Intheso-calledAmritKaal–the25-yearperiodbetweenthe75thand100thanniversariesofIndia’sindependence,whichwasgainedin1947–Indiamustleverageallchannels,includingVisionfor2047andtheSovereignGreenBonds(SGrB)framework,tosupportitswindsector,thusachievingthegovernment’svisionofgreengrowthandarenewableenergy-ledfutureforthecountry.Marketstowatch:India4.https://gwec.net/members-area-market-intelligence/fowind/5.https://www.fowpi.in/6.http://timesofindia.indiatimes.com/articleshow/9357411188GWECGLOBALWINDREPORT202389Marketstowatch:EgyptEgyptbecameoneofthepioneeringcountriesforwindenergyinAfricaandtheMiddleEast(ME)whenthegovernment’sNew&RenewableEnergyAuthority(NREA)builtapilotwindenergyprojectinHurghadain1988.Fastforwardtotoday.EgyptispoisedtoregainitsstatusasaleadingwindenergymarketfollowingtremendousambitionannouncedonthesidelinesofCOP27,whichwashostedinNovember2022onEgyptiansoilforthefirsttime.Followingtwodecadesofmodestwindandrenewableenergytargets,theEgyptiangovernmentasCOP27hostmadeanumberofgigawatt-scaleannouncements.Iftheprojectsareconstructed,theywillpropelthecountry’swindenergyindustryintotheupperechelonofemergingmarketsworldwide.KeytounlockingthisambitionistheEgyptiangovernmentannouncementoftheGreenCorridorInitiative,aseparateelectricitygridaimedatensuringrenewableenergymakesup42%ofthecountry’senergymixby2035.Thisfeaturesprojectssuchastwo10GWonshorewindfarmsplannedbyMasdarandACWAPower.TheEgyptiangovernmenthassignedcountlessMOUswithseverallocalandglobalcompaniesforinitiatingstudiesrelatedtogreenhydrogenprojects.ItalsosignedanMOUwiththeEuropeanCommissioninNovember2022establishingalong-termstrategicpartnershipto:collaborateonfutureEUimportsofrenewablehydrogenanditsderivatives;supportEgypt’sdecarbonisationandenergytransitionactivities;EgyptusesCOP27springboardtopropelitselfintomulti-GWscale00.31.722.94.36.37.38.33.45.30.90.9Cumulativeinstallations(2022-2030)11110.62023e20222024e2025e2026e2027e2028e2029e2030eProjectedwindcapacityadditionsinEgyptSource:GWEC,2023GWEC.NET90Marketstowatch:Egyptdeveloptheproduction,useandexportofrenewablehydrogenanditsderivatives.1Egypt’scurrentinstalledcapacitysitsat1,702MWfollowinggridconnectionofLekelaPower’s252MWWestBakrwindfarm.Itwillriseby1.6GWoncetheAMEAPower-led500MWAmunetproject,Engie-led500MWGulfofSuez2andACWAPower’s1.1GWwindfarm–Africa’slargest–arecompleted.Windinstallationsareestimatedtoachieve4.3GWin2026,iftheprojectscurrentlyinthepipelinegoonlineasexpected.From2027,theseveralprojectscoveredbyMOUscouldaddanestimated1GWperyear,culminatinginmorethan8GWofinstalledwindcapacityby2030.GWECiscurrentlyleadingtheestablishmentofEgypt’sfirstwindenergyassociationtosupporttheambitiousgrowththatisplanned.ProjectsinMOUsbetweenindustryandtheEgyptiangovernmentlACWAPower–10GWonshorewindfarmlMasdar,InfinityPower,HassanAllamUtilitiesConsortium–10GWonshorewindfarmlMasdar,InfinityPower,HassanAllamUtilitiesConsortium–2GWgreenhydrogenprojectintheSuezCanalEconomicZone(SCEZ)lAMEAPower–1GWgreenhydrogenprojectlAlfanar–500,000t/yofgreenammoniaand100,000t/yofgreenhydrogenlTotalEnergies–300,000t/ygreenammoniaprojectintheSokhnaregionlEgyptGreen,ajointventurebetweenScatec,Fertiglobe(anOCI-ADNOCjointventure),OrascomConstructionandTheSovereignFundofEgypt–100MWelectrolysercapacity,poweredby260MWofsolarandwindpowerlGreenFuelAllianceconsortium,ledbyEDFRenewablesandZeroWaste–greenhydrogenandammoniaprojectintheSCEZpoweredby2GWofwindandsolarlGlobeleq–3.6GWofelectrolyserspoweredbyupto9GWofsolarandwindenergylFortescueFutureIndustries(FFI)–9.2GWsolarandwindenergytoproducegreenhydrogenandammonia1.https://energy.ec.europa.eu/memorandum-understanding-strategic-partnership-renewable-hydrogen-between-european-union-and-arab_enMARKETSTATUSAllchartsinthissection:GWEC,2023GWEC.NET92MarketStatus2022Globally,77.6GWofnewwindpowercapacitywasconnectedtopowergridsin2022,bringingtotalinstalledwindcapacityto906GW1,agrowthof9%comparedwith2021.Althoughnewonshoreinstallationsdeclined5%YoYin2022,itwasstillthethirdhighestyearinhistoryforadditions.Followingarecord2021withmorethan21GWgrid-connected,newoffshorewindcapacitycommissionedlastyeardroppedto8.8GW,making2022thesecondhighestyear.Asia-Pacificlost3%inmarketsharelastyearcomparedwith2021,buttheregionremainstheworld’slargestwindmarket,withChinacontributing87%ofits2022additions.Asthesecondlargestmarket,Europesawrecordonshorewindinstallationsin2022,whichhelpedboosttheregion’smarketsharefrom19%in2021to25%.NorthAmericaretainedthirdplacebutlost2%inmarketshareduetoslowergrowthintheUS.DrivenbyarecordyearforinstallationsinBrazil,LatinAmerica(LATAM)increaseditsmarketsharein2022by1%.Afterarecordyearinnewinstallationsin2021,Africa&MEconnected453MWofwindpowerin2022,thelowestsince2013.Theworld’stopfivemarketsfornewinstallationsin2022wereChina,theUS,Brazil,GermanyandSweden.Altogether,theymadeup71%ofglobalinstallationslastyear,collectively3.7%lowerthan2021.Thiswasprimarilyduetotheworld’stwolargestmarkets,ChinaandtheUS,losingacombined5%marketsharecomparedwiththepreviousyear–thesecondconsecutiveyearthatbothcountrieshavelostmarketshare.Intermsofcumulativeinstallations,thetopfivemarketsasoftheendof2022remainedunchanged.China,theUS,Germany,IndiaandSpaintogetheraccountedfor72%oftheworld’stotalinstalledwindpowercapacity,asin2021.OverviewNewinstallationsGWNewwindpowercapacityin2022byregion(%)Newwindpowercapacityin2022andshareoftop10markets(%)21.18.86.94.450.760.895.3-17.1%93.6OnshoreOffshore6.2201846.377.6202268.8201954.6202088.4202172.57%APACEurope56%1%25%12%NorthAmericaLATAMAfrica&ME77.6GW16%ChinaUS49%11%4%3%3%BrazilGermanySwedenFinland77.6GW5%3%2%FranceIndiaUKSpainOther2%2%GWECreportsinstalledandfullycommissionedcapacityadditionsandtotalinstallations.AccordingtoGWECGlobalSupplySidedata,globally90.6GWofnewwindpowerwasmechanicallyinstalledin2022,butonly77.6GWwascommissionedprimarilybecause13GWofnewinstallationsinChinaandVietnamwerenotgrid-connected.Cumulatively,940GWofwindpowerwasmechanicallyinstalledworldwidebytheend2022,butonly906GWwascommissionedduetogridconnectiondelays.AllchartsintheMarketStatusandMarketOutlooksectionsarebasedonGWECdata.GWECGLOBALWINDREPORT202393MarketStatus2022Thestatusofonshorewindin2022Newonshorewindpowercapacityin2022andmarketsharebycountry(%)Newonshorewindpowercapacityin2022bymarketsupportmechanism(%)Newgrid-connectedonshorewindcapacityin2022amountedto68.8GW,bringingcumulativeglobalonshorecapacityto842GW,withYoYgrowthof8.8%.ThankstorecordinstallationsinSweden,FinlandandPoland,andrecoveringinstallationsinGermany,Europeperformedwellinavolatile2022,addingarecord16.7GWofonshorewindcapacity.Globaladditionsin2022were5%lowerthaninthepreviousyear.TheslowdowninLATAM,Africa&MEispartlyresponsibleforthedecline,buttheprimaryreasonistheslowdownofonshoreinstallationsintheUS.China’sonshorewindinstallationsplungedin2021whentheworld’slargestonshorewindmarketenteredtheeraof‘gridparity’,meaningthatelectricitygeneratedbyonshorewindwouldberemuneratedwiththesameregulatedpriceascoalpowerineveryprovince.GWECMarketIntelligenceforecast,initsQ12022Outlook,thatChineseonshoreinstallationswouldbounceback,reaching46GWofnewinstallationsin2022.The50.6GWofnewonshorewindcapacityapprovedunderthe‘gridparity’schemein2021showsthatthecountryisontracktoreachitsambitiousrenewableenergytargetsincludedinthe14thFive-YearPlan(2021-2025).TheChineseWindEnergyAssociation(CWEA)reportedthat44.7GWofonshorewindcapacitywasinstalledin2022,butthelateststatisticsreleasedbytheNationalEnergyAdministration(NEA)showthatonly32.6GWofnewonshorewindcapacitywasgrid-connectedlastyear.IntheUS,ourQ12022Outlookforecastrelativelystableonshorewindgrowthfor2022.TheInternalRevenueService(IRS)inJune2021providedafurtherone-yearextensionforprojectsthatstartedconstructionin2016or2017,allowingprojectdeveloperstoqualifyforthefullProductionTaxCredit(PTC)rateiftheirprojectscanmeetacommercialoperationdate(COD)ofend-2022.However,manyprojectsweredelayedbydevelopersastheyawaitedfullclarityontherulesoftheInflationReductionAct(IRA).Despitefinishingtheyearwithastrongfinalquarter,theUSwindindustrycommissionedonly8.6GWofonshorewindcapacityin2022,theslowestyearsince2018,accordingtoAmericanCleanPower(ACP).Duetosupplychainconstraintsandgridinterconnectionissues,morethan10GWofonshorewindcapacityhashaddelays,slowingtherateofinstallations.GWECexpectstheUSmarkettoacceleratesharplynowthattheIRAisinplaceandisfullyunderstoodbyinvestors.InadditiontoChinaandtheUS,theotheronshorewindmarketsinthetopfivein2022wereBrazil(4.1GW),Sweden(2.4GW)andFinland(2.4GW).‘Gridparity’,auction/tendersandthePTCremainedthetopthreemarketsupportmechanismsbehindonshorewindcapacityaddedin2022.Collectively,theyaccountforacombined91%marketshare,thesameasthepreviousyear.ExcludingChina,13.7GWofonshorewindcapacitywasawardedworldwidelastyearTop5China,US,Brazil,SwedenandFinlandOther72%28%68.8GWChina(gridparity)Auction/tenders32.6%21.3%8.60.6%3.2%2.5%US(PTC)FiTGreencertiﬁcateOther68.8GWGWEC.NET94MarketStatus2022throughwind-specific,technology-neutral,renewableandhybridauctions,whichis30%lowerthanin2021.EventhoughEuropeaccountedformorethanhalfofthisvolume,itstillsawawardedonshorewindcapacitydropby29%comparedwith2021.TriggeredbyRussia’sinvasionofUkraine,governmentsintheEUhavesetambitiousrenewableenergytargetstoensuresecurityofsupply.However,onshorewindtenderslaunchedin2022wereundersubscribedinseveralkeyEuropeanonshorewindmarketsincludingGermany,France,SpainandItaly.Longstandingpermittingissuesandincreasedprojectrisk–associatedwithglobalinflationandsupplychaindisruption–combinedwithunhelpfulmarketinterventionsbyEUgovernmentstoundermineinvestors’confidence.Chinaapproved11GWofonshorewindcapacityunderthe‘gridparity’mechanismin2022,onlyone-fifthofthevolumereportedfor2021.AsofJanuary2023,however,provincialgovernmentshadannouncedmorethan50GWofonshorewindcapacityunderthesamesupportmechanism,puttingChinaontracktoreachits‘30-60’targets.GWECGLOBALWINDREPORT202395MarketStatus20228.8GWofnewoffshorewindwasfedintothegridlastyear,bringingtotalglobaloffshorewindcapacityto64.3GWbytheendof2022.Thenewadditionsare58%lowerthanthebumperyearof2021butstillmake2022thesecondhighestyearinoffshorewindhistory.lChinacontinuedtoleadglobaloffshorewinddevelopment,althoughnewinstallationsin2022were70%lowerthanin2021–arecordyeardrivenbytheendofthefeed-intariff(FiT).Startingfrom1January2022,China’soffshorewindmarkethasalsoenteredtheeraof‘gridparity’withtheendofnationalFiTs.AlthoughfinancialsupportattheprovinciallevelisstillavailableinGuangdong,JiangsuandShandong,theincentiveismuchlowerthantheFiTpreviouslyofferedbythecentralgovernment.Commissioningmorethan5GWofnewoffshorewindin2022demonstratestheresilienceofChina’soffshorewindindustry.Bytheendof2022,cumulativeoffshorewindinstallationsinChinaexceeded30GW,amilestonethattookEuropemorethanthreedecadestoachieve.lWith2.5GWoffshorewindcapacityacrosssixcountriesconnectedtothegridin2022,Europeaccountedforthemajorityoftheremainingnewcapacity,asinthepreviousyear.lTheUKfurtherconsolidateditsleadingpositionintheEuropeanoffshorewindmarketin2022.Inadditiontocompletingthecommissioningoftheremainingwindturbines(924MW)atthe1.4GWHornseaProject2,whichisnowtheworld’sbiggestoperationaloffshorewindfarm,theUKhasgrid-connected27windturbines(255MW)atthe1.1GWSeagreenProject.lHavingfullycommissioneditsfirstcommercialoffshorewindproject,the480MWSaint-Nazairewindfarm,lastNovember,FrancebecameEurope’ssecondlargestoffshorewindmarketinnewadditionsin2022,followedbytheNetherlands(369MW)andGermany(342MW).lItalyalsocommissioneditsfirstcommercialoffshorewindprojectlastyear.The30MWBeleolicooffshorewindfarm,whichfeatures10MySE3.0-135windturbinesfromMingyang,notonlyrepresentsthefirstinstallationofChinesewindturbinesinEuropeanwaters,butalsothefirstoffshorewindprojectcommissionedintheMediterraneanSea.lInNorway,the94.6MWHywindTampenfloatingwindproject,featuring11unitsofSG-8.6MW-167windturbinesfromSiemensGamesaandaconcreteSPAR-typefloatingfoundation,wasscheduledtobecompletedbytheendof2022,butduetosupplychainissuesonlysevenwindturbines(60.2MW)havecomeintooperation.lAltogether,atotalof66.4MWoffloatingwindcapacitywascommissionedin2022,including60.2MWatNorway’sHywindTampenprojectandone6.2MWfloatingwindturbinesuppliedbyChineseCSSCHaizhuang,installedinChinaonafloaterprototypecalled‘Fuyao’.Thestatusofoffshorewindin2022Theoffshorewindmarkethasgrownfrom4.4GWin2018to8.8GWin2022,bringingitsmarketshareinglobalnewinstallationsfrom9%to11%.Thisis11percentagepointslowerthan2021,primarilyduetonewinstallationsslowingdowninChinaafteranincentive-driveninstallationrush.GWECMarketIntelligenceexpectstheglobaloffshorewindmarkettocontinuetogrowatanacceleratedpace(fordetails,seeMarketOutlook).Newoffshoreinstallations(MW)USOtherEuropeOtherAsiaGermanyUKChina237351236012201820212022202020194,3516,2436,85221,1061,7153801,6557522,4933,84516,9001,3129697528881,2591,1111,2531,7644832,2161,1111,0011,3121,7642,317CAGR+19.2%3428,7715,0527521,179939GWEC.NET96MarketStatus2022lOutsideofChinaandEurope,twoothermarketsreportednewoffshorewindinstallationsin2022:Taiwan(1,175MW)andJapan(84MW).InFebruary2022,theMinistryofEconomicAffairs’BureauofEnergypredictedatotalof2,016MWoffshorewindcapacitywouldbeaddedinTaiwanin2022.However,only145offshorewindturbinesacrossfourprojectswereconnectedlastyear.ThisisdueinparttotheCOVID-19pandemicandtyphoon-relateddisruptions.InJapan,the140MWAkitaNoshiroPortwindfarmwasscheduledtoachievefullcommissioningbytheendof2022.AlltheturbineswereinstalledbyearlyDecember,butonlythe84MWNoshiroPortoffshorewindfarmwascommissionedin2022.lNointertidaloffshorewindprojectinVietnamreachedcommercialoperationlastyear,althoughmorethan300MWofintertidalprojectcapacitymissedtheirCODdeadlinein2021andmoreturbineswereinstalledatafewintertidalprojectsin2022.ThisisbecausetheceilingpriceusedbyVietnamElectricity(EVN)asthecaptonegotiatePPAswithinvestorsfortheirrenewableenergyprojectswasmissinguntilJanuary2023.lTheUSistheonlymarketwithoffshorewindinoperationintheAmericas,butnooffshoreturbineorprojectwascommissionedin2022,asinthepreviousyear.lIntermsofcumulativeinstallations,ChinaovertooktheUKasthetopmarketin2021,andfurtherconsolidateditsmarketsharein2022.Germany,theNetherlandsandDenmarkaretheotherthreemarketsthatmakeupthetopfive.lExcludingChina,where19.7GWofoffshorewindprojectswereapprovedunderthe‘grid-parity’mechanism,atotalof12.5GWofoffshorewindcapacitywasawardedworldwidelastyearthroughauctioning,ofwhich9.5GWwasinEuropeand3GWinTaiwan.InEurope,theUKawardedthemostoffshorewindcapacity(7GW)throughtheContractsforDifference(CfD)AllocationRound4,followedbytheNetherlands(1.5GW)andGermany(980MW).Thetwo‘subsidy-free’tenders(760MWeach)thatwerelaunchedandawardedintheNetherlandswereEurope’slatestoffshorewindauctionsusingnon-pricecriteriatoselectwinners.lTheUSawardednooffshorewindprojectcapacitylastyear,butcollectivelymorethan13GWofcapacitywasallocatedthroughtheNewYorkBight,CarolinaLongBayandCalifornialeasesales.TheCaliforniaauctionwasthefirstoffshorewindleasesaleontheUSPacificCoastandthefirsttosupportcommercial-scalefloatingwinddevelopment.AfterovertakingtheUKastheworld’stopoffshorewindmarketin2021,Chinafurtherconsolidateditsmarketsharein2022GWECGLOBALWINDREPORT202397MarketStatus2022Changesinnewonshoreandoffshoreinstallations,2021–2022(GW)Newinstallationsdeclineinallregions,exceptEuropeTheannualwindmarket(onshoreandoffshorecombined)declinedinallregionsexceptEuropein2022,withaYoYfallof17.1%.lOnshorewind:despiteachallengingeconomicenvironmentandvexingsupplychainissues,Europehadarecordyearin2022withYoYgrowthof18.2%,primarilydrivenbyrecordinstallationsinSweden,FinlandandPoland,aswellasrecoveringinstallationsinGermany.Comparedwith2021,however,newonshorewindcapacityaddedinNorthAmerica,Africa&MEandLATAMlastyearfellby28%(3.8GW),75%(1.4GW)and10%(0.6GW)respectively,whilenewadditionsinAPACremainedconstant.ThedeclineinNorthAmerica,Africa&MEandLATAMismainlyduetoloweronshoreinstallationstheUS,noturbinesweregridconnectedinAfrica’stwolargestwindmarkets,SouthAfricaandEgypt,andtherewasasharpdropinnewinstallationsinArgentinaandMexico.lOffshorewind:newoffshorewindinstallationsdecreasedby58%(12.3GW)comparedwith2021,mainlyduetoannualgrowthreturningtonormalafterChina’spolicy-driveninstallationrushcametoanend.Total2021-12.3-2.52022LATAMonshore1.993.62.677.6Indiaonshore-4.1-1.4Africa,MEonshore-0.6EuropeonshoreOtheronshore0.4USonshoreChinaonshoreOffshoreGWEC.NET98MarketStatus2022Actuals2022vsGWECforecastChinaonshoreChineseonshorewindinstallationswereexpectedtobouncebackin2022toreach46GW,asmorethan50.6GWofonshorewindcapacitywasapprovedunderthe‘gridparity’schemein2021,demonstratingthatthecountryisontracktoreachitsambitiousrenewableenergytargets.AccordingtoChina’sNEA,32.6GWofonshorecapacitywasgrid-connectedlastyear,butCWEAstatisticsshowthat44.7GWofonshorewindcapacitywasmechanicallyinstalledin2022.USAonshoreTherationalebehindourforecastfortheUSisthattheIRSinJune2021providedafurtherone-yearextensionforprojectsthatstartedconstructionin2016or2017,allowingprojectdeveloperstoqualifyforthefullPTCrateiftheirprojectscanreachtheirCODbyendof2022.Althoughonly4.1GWofonshorewindhadbeencommissionedbythethirdquarterof2022,abiginstallationpushwasstillexpectedforQ42022.ACPstatisticsshowthatQ4wasthestrongestquarteroftheyear,butduetosupplychainconstraintsandgridinterconnections,quarterlyinstallationswerestilldown35%comparedwith2021.IndiaonshoreIndiacommissioned1.58GWofwindpowerinthefirstthreequartersof2022,continuingthetrendofrecoveringinstallationrates.However,totaladditionsin2022werestilllowerthanourQ32022projection,whichisprimarilydrivenbythecancellationofprojectsrenderedunviablebyhighinflationanddelaysonaccountofgridunavailabilityandtimelineextensionsintheirScheduledCommissioningDate(SCD).GermanyonshoreToreducerelianceonfossilfuelsimportedfromRussia,Germany’snewfederalgovernmentincreasedits2030renewablestargetwhileintroducinganew‘OnshoreWindLaw’(WindLandG)inJuly2022toaccelerateinstallationsaspartofits‘EasterPackage’.Actualonshorewindinstallationsin2022wereslightlylowerthanexpected,butstillmadeGermanyEurope’slargestwindmarketforadditionsin2022.BrazilonshoreWindpowerdevelopmentinBrazilhasdemonstratedtheindustry’sresilienceoverthepastthreeyears,especiallyduringtheCOVID-19pandemicandthecountry’spoliticalturbulence.2022wasarecordyear,withmorethan4GWofonshorewindinstallations.ThestronggrowthislinkedtoprojectsbeingdevelopedthroughboththeregulatedschemeofpublicauctionsandthefreemarketofprivatePPAs.VietnamonshoreSincemorethan1GWofregisteredonshorewindprojectsmissedtheirCODdeadlinein2021,weexpectedsomeofthemtostartcommercialoperationin2022,providedofftakeagreementscouldbemade.However,noonshorewindprojectsachievedcommercialoperationlastyearduetotheceilingpriceusedbyEVNasthecaptonegotiatePPAswithinvestorsforrenewableprojectsnotbeinginplaceuntilJanuary2023.UKoffshoreIn2022,GWECMarketIntelligenceexpectedtheremainingoffshoreturbines(totalling924MW)atthe1.4GWHornseaProject2toreachcommercialoperation,andhalfoftheturbinesatthe1,075MWSeagreenProject(114windturbines)inScotlandtocomeintooperation.AlthoughalltheturbineswerefullycommissionedattheHornseaProject2,only27windturbines(255MW)weregrid-connectedattheScottishproject.GermanyoffshoreThe342MWKaskasioffshorewindfarmreachedcommercialoperationintheGermanNorthSeain2022,inlinewithourprojection.Newoffshorewindinstallationshavebeenlowsince2020,primarilyduetounfavourableoffshorewindpoliciesandasmallshort-termoffshorewindprojectpipeline.ChinaoffshoreAfterarecordyearin2021,withnearly17GWofoffshorewindgrid-connected,newinstallationswerepredictedtodropdramaticallyfollowingtheintroductionof‘gridparity’intheChineseoffshorewindmarketfrom2022.GWECMarketIntelligencepredicted6GWofoffshorewindtobecommissionedin2022,whichwasprimarilybasedonthefactthatmorethan7GWofoffshorewindprojectshadstartedconstructionbyQ12022.Actuals2022ForecastQ32022ChinaUSIndiaGermanyBrazilGermanyoffshoreVietnamoffshoreUKoffshoreChinaoffshore32,57946,0008,6129,5002,4002,4032,70034234230001,1791,4625,0526,0004,0653,9001,847Actualsfor2022vsGWECforecastGWECGLOBALWINDREPORT202399MarketStatus2022Newinstallationsonshore(%)Totalinstallationsonshore(%)Newinstallationsoffshore(%)Totalinstallationsoffshore(%)China40%US17%Germany7%India5%Spain4%France2%Canada2%UK2%Sweden2%Brazil3%Restofworld17%841.9GWChina58%UK13%Taiwan13%France5%Restofworld6%Netherlands4%8.8GWChina49%UK22%Germany13%Netherlands4%Denmark4%Restofworld9%64.3GWDetaileddatasheetavailableinGWEC’smember-onlyarea.FordefinitionofregionseeAppendix-MethodologyandTerminologyChina47%US13%Brazil6%Sweden4%Germany3%Finland4%India3%Spain2%France2%Poland2%Restofworld14%68.8GWGWEC.NET100MarketStatus20222004Shareofoffshore~1%~3%200220172003200520062007200820092010201120162013201220152018201920202021202220142001OnshoreOffshore5-23%11%CAGR+22%CAGR+10%CAGR+3%7.920.07.16.414.611.426.537.938.239.843.934.550.260.48.154.649.072.588.452.746.314.70.136.01.60.27.30.38.126.90.40.939.163.83.40.111.50.18.20.320.30.638.50.940.61.551.72.254.945.01.26.50.153.54.54.450.760.86.293.621.168.877.68.895.36.9Historicdevelopmentofnewinstallations(GW)GWECGLOBALWINDREPORT2023101MarketStatus2022Shareofoffshore~1%~2%OnshoreOffshore3-7%7%CAGR+26%CAGR+17%CAGR+11%39739311915719523427831236242147352262177470956820052002200124312003201720040242006201420072010200820162009201128352012201320152018201920202021-139310-174-159-148194319811214238215973198370124331448819540235912965056830842202264906367454758Historicdevelopmentoftotalinstallations(GW)GWECadjusted2021totalinstallationscomparedwiththeGlobalWindReport2022basedonthelatestavailablestatistics.FordetailsseeAppendix–MethodologyandTerminologyGWEC.NET102MarketStatus2022MW,onshoreNewinstallations2021Totalinstallations2021Newinstallations2022Totalinstallations2022Totalonshore7249977381868816841898Americas1924318958214829204134USA127471358488612144184Canada67714255100615261Brazil383021567406525632Mexico47371591587317Argentina6693291183309Chile61534448244268OtherAmericas23240181464165Africa,MiddleEast180993593499708Egypt237170201702Kenya1024350435SouthAfrica668344203442Morocco19715122761788SaudiArabia4164220422OtherAfrica1891846731919Asia-Pacific3735236588736970402852China3067030141932579333998India145940083184741930Australia17469125141210537Pakistan22915163011817Japan21145231494668SouthKorea641562961658Vietnam2717310203102Philippines04430443Kazakhstan88337418755OtherAPAC16837761693945Europe1409520899116667225204Germany192556814240358951France119219079159020653Sweden210411952244114393UnitedKingdom3281407450214575Spain75028134165929793Finland671318624305607Netherlands95253709336223Turkey14001110286711969OtherEurope477359280384263040MW,offshoreNewinstallations2021Totalinstallations2021Newinstallations2022Totalinstallations2022Totaloffshore2110655549877164320Americas042042USA042042Asia-Pacific1778827695631134006China1690026390505231442Japan05284136SouthKorea01420142Vietnam7798740874Taiwan10923711751412Europe331727812246030272UnitedKingdom231712739117913918Germany077133428055France02480482Netherlands39224603692829Denmark605230802308Belgium0226202262OtherEurope432890418Historicdevelopmentofnewandtotalgrid-connectedinstallationsGWECadjusted2021newandtotalinstallationscomparedwiththeGlobalWindReport2022basedonthelatestavailablestatistics.MARKETOUTLOOKAllchartsinthissection:GWEC,2023GWEC.NET104MarketOutlook2023–2027GWECMarketIntelligenceexpectsthatnewwindpowerinstallationswillexceed100GWin2023andthat680GWofnewcapacitywillbeaddedinthenextfiveyearsundercurrentpolicies.Thisequalsmorethan136GWofnewinstallationsperyearuntil2027.Thecompoundannualgrowthrate(CAGR)forthenextfiveyearsis15%.Achievingdouble-digitgrowthisaverypositivedevelopment.Therearefivepillarsthatwillunderpinthislevelofsuccessinthenextfiveyears:lEurope’srenewedurgencytoreplacefossilfuelswithrenewablestoachieveenergysecurityintheaftermathoftheRussianinvasionofUkraine.lAstrongupliftforrenewableenergyintheUSoverthenexttenyears,primarilydrivenbytheInflationReductionAct(IRA).lChina’scommitmenttofurtherexpandingtheroleofrenewablesinitsenergymix,aimingforrenewableenergytocontributemorethan80%oftotalnewelectricityconsumptionbytheendofthe14thFive-YearPeriod(2021–2025).lGovernmentsfullywakinguptotheopportunitiesthatoffshorewindcanprovide,makingoffshorewindtrulyglobalandincreasingambitioninmatureanddevelopingmarkets.lStronggrowthinlargeemergingmarketsbothonshoreandoffshorefromthemiddleofthisdecade.Globalwindpowergrowthin2023–2027willcontinuetorelyprimarilyonthreemarketsupportmechanisms:l‘Gridparity’(China)lTaxcredit(PTC,ITCandtechnology-neutraltaxcreditsintheUS)lWind-specific,technology-neutral,renewableandhybridauctions(Europe,LATAM,Africa&MEandSouthEastAsia).Inadditiontoaddressingchallengessuchaspermittingandmarketdesign,governmentswillhavetoimplementnewpolicysolutionstoensurethattheglobalsupplychaincanmeetincreasingdemandfrombothestablishedandemergingmarkets.OnshoreOffshore362024e20222023e2026e2027e2025e781151251351501573218261891221171091069769CAGR15%Newinstallationsoutlook2023–2027(GW)GWEC’sMarketOutlookrepresentstheindustryperspectiveforexpectedinstallationsofnewcapacityforthenextfiveyears.Theoutlookisbasedoninputfromregionalwindassociations,governmenttargets,tenderresults,announcedauctionplans,availableprojectpipeline,andinputfromindustryexpertsandGWECmembers.AnupdatewillbereleasedinQ32023.Adetaileddatasheetisavailableinthemember-onlyareaoftheGWECIntelligencewebsite.Globalwindenergymarketexpectedtogrowby15%onaverageperyearGWECGLOBALWINDREPORT2023GlobalonshoreoutlookTheCAGRforonshorewindinthenextfiveyearsis12%.Expectedaverageannualinstallationsare110GW,withatotalof550GWlikelytobebuiltin2023–2027.GrowthinChina,EuropeandtheUSwillbethebackboneofglobalonshorewinddevelopmentinthenextfiveyears.Altogethertheyareexpectedtomakeupmorethan80%oftotaladditionalcapacityin2023–2027.GWECMarketIntelligencebelievesthatChinawillbetheengineofnear-termgrowth,accountingfor62%ofnewinstallationsin2023.ButinstallationswillaccelerateinEurope,theUSandemergingmarketsinSoutheastAsiaandAfrica&MEfrom2025.Globalonshorewindmarketswillbecomemorediversifiedby2027withhalfoftheannualgrowthcomingfrommarketsoutsideofChina.GlobaloffshoreoutlookAfteraYoYfallof58%in2022,annualoffshorewindinstallationsareexpectedtobouncebackreaching18GWin2023.TheCAGRforoffshorewindinthenextfiveyearsis32%.Withsuchapromisinggrowthrate,newinstallationsarelikelytodoubleby2027from2023levels.ChinaandEuropewillbethetwokeycontributorstonear-termgrowth,makingupmorethan80%ofnewadditionsin2023and2024.TheUSandemergingmarketsinAPACwillstartgainingsizeablemarketsharefrom2025with7-8GWofnewoffshorewindexpectedtobeaddedeveryyearovertherestoftheforecastperiod.Intotal,130GWofoffshorewindisexpectedtobeaddedworldwidein2023–2027,withexpectedaverageannualinstallationsofnearly26GW.GrowthinChina,EuropeandtheUSwillbethebackboneofglobalonshorewinddevelopmentinthenextfiveyearsMarketOutlook2023–2027105OffshorewindTheglobaloffshoremarketisexpectedtogrowfrom8.8GWin2022to35.5GWin2027,bringingitsshareoftotalnewglobalinstallationsfromtoday’s11%to23%by2027.InAsia,Chinawillremainthelargestcontributorwith64GWtobeaddedinthenextfiveyears,followedbyTaiwan(6.9GW),SouthKorea(2.3GW),Vietnam(2.2GW,primarilyintertidalprojects)andJapan(0.9GW).InEurope,morethan37GWofoffshorewindcapacityisexpectedtobebuiltin2023–2027,ofwhich41%islikelytobeinstalledintheUK-primarilydrivenbythecommissioningofCfDAllocationRound3and4projects,16%inGermany,9%intheNetherlands,8%inPoland,8%inFranceand6%inDenmark.Withthefirstutility-scaleoffshorewindprojectexpectedtobepartiallyconnectedin2023,15GWofoffshorewindcapacityispredictedtobecommissionedintheUSinthenextfiveyears,makingitthelargestoffshorewindmarketafterChinaandtheUKintermsofnewadditions.ThisprojectionisbasedontheassumptionthatthesupplychainwillbeestablishedintimetoaddressthegrowthfromtheEastCoastoftheUS.ChinaStrictCOVID-19restrictionsandtheimpactofasudden‘reopening’ofthecountrymade2022adifficultyear.Achievinggridconnectionof33GW(mechanicalinstallationof45GW)ofonshorewindcapacityhasdemonstratedtheresilienceoftheChinesewindindustry.Inearly2023,theNEApredictedthatgenerationfromwindandsolarpowerwilldoubleby2025from2020levels.Toreachthetarget,250–300GWofwindpowercapacityneedstobeaddedbetween2021and2025.Sincemorethan80GWofwindturbineordershavealreadybeenawardedin2022andtheChinesegovernmentcommittedtonon-fossilfuelsachieving25%ofthecountry’sprimaryenergymixby2030,GWECMarketIntelligencehasfurtherupgradeditsonshorewindinstallationsforecastandnowpredicts300GWofnewcapacitytoGWEC.NET106MarketOutlook2023–2027Africa,MEChinaOffshoreNorthAmericaEuropeLatinAmericaAsiaexChinaPaciﬁc77,587115,425124,451134,710149,661156,98320222023e2024e2025e2026e2027e0%2%42%48%45%40%38%52%12%4%7%14%8%14%8%14%9%22%19%23%15%16%5%5%4%7%4%6%3%7%3%7%11%15%10%13%21%8%1%1%2%1%3%1%3%1%3%1%Newonshoreandoffshoreinstallationsoutlookbyregion(MW,%)OnshorewindinAPAC,EuropeandtheUSisexpectedtoacceleratewhileoffshorewindkeepsgoingstrongGWEC’sMarketOutlookrepresentstheindustryperspectiveforexpectedinstallationsofnewcapacityforthenextfiveyears.Theoutlookisbasedoninputfromregionalwindassociations,governmenttargets,availableprojectinformationaswellasinputfromindustryexpertsandGWECmembers.AnupdatewillbereleasedinQ32023.Adetaileddatasheetisavailableinthemember-onlyareaoftheGWECIntelligencewebsite.GWECGLOBALWINDREPORT2023107beaddedtothegridinChinainthenextfiveyears.Asiaexcl.ChinaExcludingChina,IndiaisthelargestwindmarketinAsia.Weexpectthecountry’sonshorewindmarkettocontinuetorecover,withnewadditionspeakingin2025–2026giventheexpiryofthe100%interstatetransmissionchargewaiver(ISTS)inJune2025.Towards2030,annualgrowthhasthepotentialtoreach5-6GWunderthenew8GW/yeartendertrajectory.However,thetaperingdownfrom50%tozeroofISTSchargewaive-offsbetween2026and2028islikelytolimitinstallationsto4.5–5.0GW.Intotal,21GWofonshorewindcapacityislikelytobeaddedinIndiain2023–2027,accountingforhalfofthepredictedadditionsfortheregion.NoonshorewindprojectsachievedcommercialoperationinVietnamlastyear,butweexpectnewcapacitytobecommissionedin2023and2024nowthataceilingpriceusedbyEVNtonegotiatePPAswithinvestorsfortheirrenewableprojectshasbeensetbytheMinistryofIndustryandTrade.Elsewhereintheregion,growthisexpectedtocomefromJapan,PakistanandemergingmarketsofsoutheastAsia,aswellasinCentralAsia.SoutheastAsia(mainlythePhilippines,Laos,ThailandandSriLanka)andCentralAsia(primarilyKazakhstanandUzbekistan)arelikelytomakeup22%and12%,respectively,ofthenewcapacityexpectedforthisregionin2023–2027.PacificNoprojectswerecommissionedinNewZealandin2022,althoughtwoprojectstotalling260MWwereunderconstructionlastyear.WithconstructionworkongoingatanothertwoprojectsexpectedtobeonlinebyDecember,2023willbearecordyearforthismarket.However,growthinNewZealandislikelytostopifnoprojectisaddedtothepipelineinthenexttwoyears.InAustralia,thetotalcapacityofshovel-readyonshorewindprojectsatthestartof2023wascloseto4GW.Althoughtheinstallationratein2023ispredictedtobethelowestsince2019–basedonannouncedprojectCODs–annualinstallationswillsurgeagainfrom2024andmorethan3GWofonshorewindisexpectedtobeconnectedbefore2026.Growthmomentumislikelytocontinuebeyond2025because:lMorestateshaverolledoutrenewabletendersandrenewableenergyzonesasmorerenewablesandstorageareurgentlyneededtoreplacecoalplantsduetoretire.MarketOutlook2023–2027108MarketOutlook2023–2027lThecorporatePPAmarketremainsstrong,drivenbysustainabilitygoals.lTherearecommitmentsfromminingandheavyindustriesoncaptiverenewablesandgreenhydrogen.lSeveraltransmissionprojects,suchasProjectEnergyConnect,VNIWestandMarinusLink,areeitherapprovedorunderconstruction.EuropeOurforecastforthenextfiveyearsisinlinewithWindEurope’sCentralScenario1,whichisbasedonthelatestdevelopmentsinEUregulation,nationalpolicies,signedPPAs,projectdevelopmenttimelinesandtheabilityofwindtosecurefurthercapacityinupcomingauctionsandtenders.Afterarecordyearofinstallations,onshorewindadditionsinEuropein2023arelikelytofallby13%comparedwithlastyear,whichisduetoanexpectedslowdownintheNordiccountries.LocaloppositionandlawsenablinglocalcommunitiestoblockanyprojectarehavingaparticularlynegativeeffectinNorway.WithstronggrowthcomingbackinestablishedEuropeanmarketssuchasGermany,Spain,theUK,France,ItalyandTurkey,theEuropeanonshoremarketwilltakeoffagainfrom2024.DrivenbytheREPowerEUtargetand2030renewabletargetsfornon-EUcountries,recordonshorewindinstallationsareexpectedforEuropeeveryyearovertherestoftheforecastperiod.NorthAmericaTheUSonshorewindmarkethasbeenataxcredit-drivenmarket.WiththeIRAsignedintolawbytheBidenadministrationlastAugust,thesituationislikelytocontinueforthenexttenyears.TheIRAextendedandincreasedinvestmentandproductiontaxcredits(ITCandPTC)through2024forwindenergyprojectsthatbeginconstructionbefore1January2025.In2025,thetaxcreditsforwindwillbereplacedwithtechnology-neutralcreditsforlow-carbonelectricitygeneration,whichinturnareslatedforphaseoutin2032,orwhengreenhousegasemissionsfromtheUSpowersectorfallto25%of2022levels,whicheverislater2.Additionally,undertheIRA,projectscanreceivestackablebonuscreditsifcertainlocalcomponentrequirementsaremet.GWECexpectstheUSonshorewindmarkettoacceleratenowthatguidancefromISRontheIRAimplementationisinplace.Withthetaxbenefitsandincentivesbeingfullyunderstoodbyinvestorsandsuppliers,newinvestmentplanshavealreadybeenannounced1.https://windeurope.org/intelligence-platform/product/wind-energy-in-europe-2022-statistics-and-the-outlook-for-2023-2027/2.https://www.energy.gov/eere/wind/articles/us-wind-industry-federal-incentives-funding-and-partnership-opportunities-factGWECGLOBALWINDREPORT2023109MarketOutlook2023–2027acrossthecountry.Intotal,60GWofonshorewindcapacityisexpectedtobeaddedinthenextfiveyearsinNorthAmerica,ofwhich92%willbebuiltintheUSandtherestinCanada.Growthmomentumisunlikelytostopinthisregionbeyond2027,asmorecapacityispredictedtobeaddedintheUSin2028–2032,primarilydrivenbytechnology-neutraltaxcredits.LatinAmericaGrowthinLATAMremainedstablein2022withnewinstallationsreaching5.2GW,thesecondhighestinhistory.ThegrowthwasprimarilydrivenbyBrazil,whichhadarecordyearandmadeupnearly80%oftheregion’sadditionalcapacity.Brazilperformedwellinthepasttwoyears:itsstronggrowthwaslinkedtoprojectsbeingdevelopedthroughboththeregulatedschemeofpublicauctionsandthefreemarketofprivatePPAs.DespitepipelinegrowthhavingbeeninterruptedbyanunhelpfulpolicyenvironmentinMexicoandeconomicinstabilityinArgentina,newLATAMinstallationsof5GWarelikelyin2023–2027,primarilydrivenbyongoinggrowthinBrazilandChile,aswellasthecompletionoflong-awaitedprojectsinColombia.GWECMarketIntelligenceexpects26.5GWofonshorewindtobeaddedinthisregioninthenextfiveyearswithBrazil,ChileandColombiacontributing78%oftheadditions.Africa/MiddleEastAfterarecordyearinnewinstallationsin2021,Africa&MEconnected453MWofwindpowerlastyear,thelowestsince2013.ComparedwithGWECMarketIntelligence’sQ32022Outlook,newonshorewindadditionsforthisregioninthenextfiveyearshavebeendowngradedby16%(2.6GW).ThisistheresultofmostoftheawardedonshorewindprojectsfromtheREIPPPBidWindow5auctionbeingdelayedinSouthAfricaandnowindcapacitybeingawardedfromtheREIPPPBidWindow6auction,launchedin2022,duetotheunavailabilityofgridcapacityintheprovincesofEasternCapeandWesternCape.WithGW-levelprojectsexpectedtobebuiltinNorthAfricaandSaudiArabia–andprojectsfromtheREIPPPBidWindow5auctioncomingonline–annualgrowthislikelytobouncebackinthisregionreaching5GWin2026–2027.Intotal,17GWofnewcapacityisexpectedtobeaddedinthenextfiveyears(2023–2027),ofwhich5.3GWwillcomefromSouthAfrica,3.6GWfromEgypt,2.4GWfromSaudiArabiaand2.2GWfromMorocco.GWEC.NET110MarketOutlook2023–20272025e2024e20222023e2026e2027e2025e2024e20222023e2026e2027e2025e2024e20222023e2026e2027e2025e2024e20222023e2026e2027e2025e2024e20222023e2026e2027e16.714.517.818.92123.30.337.066.870.170.572.572.38.818.018.225.732.435.51.23.13.44.74.9EuropeonshoreAsia-PaciﬁcoffshoreEuropeoffshoreNorthAmericaoffshoreLatinAmericaonshoreNorthAmericaonshoreAfricaonshoreMiddleEastonshore7.84.51.70.57.84.764.55.94.23.43.42.51.8OtherAsia-PaciﬁconshoreIndiaonshoreChinaonshore0.30.50.90.32.30.82.50.93.80.93.9114.814.915.416.219.121.09.65.295.9105.4115.2145.11656.317.811.85.813.632.514.93.8717.6104.812.118.94.5606060606032.6Regionalonshoreandoffshorewindoutlookfornewinstallations(GW)APPENDIXGWEC.NET112AppendixGlobalWindReport2023-MethodologyandTerminologyDatadefinitionsandadjustmentsGWECreportsinstalledandfullycommissionedcapacityadditionsandtotalinstallations.Newinstallationsaregrossfiguresnotdeductingdecommissionedcapacity.Totalinstallationsarenetfigures,adjustedfordecommissionedcapacity.HistoricinstallationdatahasbeenadjustedbasedontheinputGWECreceived.GWECmadetheadjustmentstobothnewandcumulativeinstallationsin2021forallthemarketswhereupdatedstatisticsareavailable.DefinitionofregionsGWECadjusteditsdefinitionofregionsforthe2018GlobalWindReportandmaintainstheseinthe2023edition,specificallyforLatinAmericaandEurope.LatinAmerica:South,CentralAmericaandMexicoEurope:GeographicEuropeincludingNorway,Russia,Switzerland,TurkeyandUkraineSourcesforthereportGWECcollectsinstallationdatafromregionalandcountrywindassociations,alternativelyfromindustryexpertsandwindturbinemanufacturers.UsedterminologyGWECusesterminologytothebestofourknowledge.Withthewindindustryevolving,certainterminologyisnotyetfixedorcanhaveseveralconnotations.GWECiscontinuouslyadaptingandadjustingtothesedevelopments.APACAsia-PacificBNEFBloombergNewEnergyFinanceBOEMBureauofOceanEnergyManagement(BOEM)C&ICommercialAndIndustrialCAGRCompoundAnnualGrowthRateCAISOCaliforniaIndependentSystemOperatorCAPEXCapitalExpenditureCBAMCarbonBorderAdjustmentMechanismCCERChinaCertifiedEmissionReductionCCGTCombinedCycleGasTurbineCCUSCarbonCapture,Utilisation,AndStorageCfDContractforDifferenceCO2/CO2eCarbonDioxide/EquivalentCODCommercialOperationDateCOPConferenceofthePartiesDFIDevelopmentFinanceInstitutionDNSHDoNoSignificantHarmDSRDemand-SideResponseECAExportCreditAgencyEGATElectricityGeneratingAuthorityofThailandEEZExclusiveEconomicZoneEIAEnvironmentalImpactAssessmentEMDEsEmergingMarketsandDevelopingEconomiesEMSEnergyManagementSystemEPCEngineeringProcurementConstructionESGEnvironmental,Social,andCorporateGovernanceEUEuropeanUnionEVElectricVehicleEVOSSEnergyVirtualOne-StopShopFDIForeignDirectInvestmentsFIDFinalInvestmentDecisionFiTFeed-InTariffFTEFull-TimeEquivalentGDPGrossDomesticProductGHGGreenhouseGasesGSTGoodsandServicesTaxGWGigawattHSSEHealth,Safety,Security,AndEnvironmentHVDCHigh-VoltageDirectCurrentIEAInternationalEnergyAgencyIFCInternationalFinanceCorporationIoTInternetofThingsIPCCIntergovernmentalPanelonClimateChangeIPPIndependentPowerProducersIRATheUSInflationReductionActIRENAInternationalRenewableEnergyAgencyIRPIntegratedResourcePlanISOIndependentSystemOperatorITCInvestmentTaxCreditktKiloTonneskWhKilowattHourLATAMLatinAmericaLCOELevelisedCostofEnergyLNGLiquefiedNaturalGasMEAMetropolitanElectricityAuthorityofThailandMNREMinistryOfNewandRenewableEnergyMOITMinistryofIndustryandTradeofVietnamMOUMemorandumofUnderstandingMtMetricTonnesMWMegawattMWhMegawattHourNDCsNationallyDeterminedContributionsNEAChina’sNationalEnergyAdministrationNFTsNon-FungibleTokensNSECNorthSeasEnergyCooperationO&MOperationAndMaintenanceOEMsOriginalEquipmentManufacturersOSSOneStopShopOPEXOperationalExpenditureOWSCOffshoreWindServiceContractsPDPPowerDevelopmentPlanofVietnamPEAProvincialElectricityAuthorityofThailandPPAPowerPurchaseAgreementPVPhotovoltaicPTCProductionTaxCreditR&DResearchAndDevelopmentRECsRenewableEnergyCertificatesREERareEarthElementROIReturnonInvestmentRPSRenewablesPortfolioStandardsRTORegionalTransmissionOrganisationSTEMScience,Technology,EngineeringandMathematicsTWTerawattTWhTerawattHourCommonindustryacronymsAppendixGWECGLOBALWINDREPORT2023113AppendixAboutGWECMarketIntelligenceGWECMarketIntelligenceAreasGWECMarketIntelligenceprovidesaseriesofinsightsanddata-basedanalysisonthedevelopmentoftheglobalwindindustry.Thisincludesamarketoutlook,countryprofiles,policyupdates,deep-divesontheoffshoremarketamongmanyotherexclusiveinsights.GWECMarketIntelligencederivesitsinsightsfromitsowncomprehensivedatabases,localknowledgeandleadingindustryexperts.Themarketintelligenceteamconsistsofseveralstrongexpertswithlong-standingindustryexperienceacrosstheworld.GWECMarketIntelligencecollaborateswithregionalandnationalwindassociationsaswellasitscorporatemembers.HowtoaccessGWECMarketIntelligenceCorporateGWECMemberslWindenergyassociationslMarketIntelligencesubscriptionContactContactFengZhaofeng.zhao@gwec.netGWECMarketIntelligencecreatedaMember-onlyareatoprovidemorein-depthmarketintelligencetoGWEC’smembersandtheiremployees.ClickheretogetyourloginMarketInsightsMarketstatistics,marketoutlook,auction/tenderupdatesPolicyandRegulationsCountryprofiles,policyupdates,offshoreupdatesAssetOwnersDatabaseofassetownersinkeymarketsTechnology/SupplyChainWindturbinedata,technologytrends,componentassessmentEnergyTransitionShifttovalue-focused,newwind-basedsolutionsO&MISP-OEM-SelfPerformdatabaseforkeymarketsAppendixGWEC.NET114GWEC.NET114AppendixProductFrequency1.WindEnergyStats/MarketDataWindStats2022(historicannual,accumulative,decommisiondata)AnnualGlobalWindReport2023AnnualWindEnergyStatistics(windenergypenetrationrate,jobs)Annual2.CountryProfiles/PolicyUpdatesCountryProfilesOnshores/CountryProfilesOffshoreAnnualAd-hocPolicyUpdatesAd-hoc3.MarketOutlookGlobalWindMarketOutlook2023-2027(Q1andQ3)Database+ReportSemi-AnnualIndiaMarketOutlookReport2023-2027AnnualGlobalWindWorkforceOutlook2023-2027Annual4.SupplySideDataGlobalWindTurbineSupplySideDataReport2022(byOEM,bytechnology,byturbineratings,modelsanddrivetrain,etc)Annual5.Auctions/TendersGlobalWindAuctionDatabaseAnnual/AuctionTrendsandLearningsQuarterly6.OffshoreWindMarketGlobalOffshoreWindReport2023/MarketEntryOpportunitiesDatabaseAnnual/QuarterlyGlobalOffshoreProjectPipeline(database,inoperationandunderconstruction)Annual/QuarterlyGlobalOffshoreTurbineInstallationVesselDatabaseandReportAnnual/Quarterly7.ComponentsAssessmentBlade(Q42023),Generator(Q42021),Gearbox(Q42022),followedbyothercomponentsSpecialReport8.WindAssetOwners/OperatorsAssetOwnersandOperatorsDatabase(Onshore&OffshoreRanking)AnnualAssetOwnersandOperatorsStatusReport(includingstrategicaltrends)Annual9.O&MO&MServiceProviderDatabase(ISP-OEM-Self-perform)AnnualO&MServiceProviderStatusReport(includingregionaltrends)Annual10.Energytransition,Digitalisation,NewTechnologiesPositionpapers/studies-permitting,CorporatePPAs/Newsolutions,GWECpolicyrecommendationsSpecialReportGWECMarketIntelligenceProductsin2023GWECGLOBALWINDREPORT2023115GlobalLeadersGWEC.NETSiemensGamesaSiemensGamesaunlocksthepowerofwind.Formorethan40years,wehavebeenapioneerandleaderofthewindindustry,andtodayourteamofmorethan26,000colleaguesworkatthecenteroftheglobalenergyrevolutiontotacklethemostsignificantchallengeofourgeneration–theclimatecrisis.Withaleadingpositioninonshore,offshore,andservice,weengineer,buildanddeliverpowerfulandreliablewindenergysolutionsinstrongpartnershipwithourcustomers.Aglobalbusinesswithlocalimpact,wehaveinstalledmorethan120GWandprovideaccesstoclean,affordableandsustainableenergythatkeepsthelightsonacrosstheworld,whilesupportingthecommunitieswhereweoperate.ShellShellisbuildingaglobalintegratedpowerbusinessspanningelectricitygeneration,tradingandsupply.Shellenteredtheoffshorewindbusinessin2000aspartofaconsortiumthatinstalledthefirstoffshorewindturbineinUKwaters.Today,wehavedeployed,oraredeveloping,overeightgigawatts(GW)ofwindacrossNorthAmerica,Europe,theUK,andAsia.WeseeoffshorewindasacriticalwayofgeneratingrenewableelectricityforourcustomersandmovingShelltowardsitstargetofbeinganet-zeroemissionsenergybusinessby2050orsooner,instepwithsociety.ØrstedTheØrstedvisionisaworldthatrunsentirelyongreenenergy.Ørsteddevelops,constructs,andoperatesoffshoreandonshorewindfarms,solarfarms,energystoragefacilities,renewablehydrogenandgreenfuelsfacilities,andbioenergyplants.Moreover,Ørstedprovidesenergyproductstoitscustomers.Ørstedistheonlyenergycompanyintheworldwithascience-basednet-zeroemissionstargetasvalidatedbytheScienceBasedTargetsinitiative(SBTi).Ørstedranksastheworld’smostsustainableenergycompanyinCorporateKnights’2022indexoftheGlobal100mostsustainablecorporationsintheworldandisrecognisedontheCDPClimateChangeAListasagloballeaderonclimateaction.MainstreamRenewablePowerMainstreamRenewablePowerisaleadingpure-playrenewableenergycompany,withwindandsolarassetsacrossglobalmarkets,includinginLatinAmerica,Africa,andAsia-Pacific.Mainstreamisoneofthemostsuccessfuldevelopersofgigawatt-scalerenewablesplatforms,acrossonshorewind,offshorewind,andsolarpowergeneration.Ithassuccessfullydelivered6.5GWofwindandsolargenerationassetstofinancialclose-ready.InMay2021,AkerHorizonsacquireda75%equitystakeinthecompany,acceleratingitsplanstodeliveritshigh-qualitypipelineofover16gigawattsofcleanenergy.MainstreamhasraisedmorethanEUR3.0bninprojectfinancetodateandemploysmorethan420peopleacrossfivecontinents.TheGlobalWindEnergyCouncil’sGlobalLeadersareanexclusiveleadershipgroupofdecision-makersandtop-tiermemberswhoformthebasisoftheAssociation’sExecutiveCommittee,whichdrivestheworkprogrammeandplaysamajorroleinshapingGWEC’sprioritiesforitseffortsintheshortandlong-termstrategy.GWECGlobalLeadersGWEC.NET116GlobalLeadersGWECGLOBALWINDREPORT2023GERenewableEnergyGERenewableEnergyharnessestheearth’smostabundantresources–thestrengthofthewind,theheatofthesunandtheforceofwater;deliveringgreenelectronstopowertheworld’sbiggesteconomiesandthemostremotecommunities.Withaninnovativespiritandanentrepreneurialmindset,weengineerenergyproducts,gridsolutionsanddigitalservicesthatcreateindustry-leadingvalueforourcustomersaroundtheworld.IberdrolaWithover170yearsofhistorybehindus,Iberdrolaisnowaglobalenergyleader,thenumberoneproducerofwindpower,andoneoftheworld’sbiggestelectricityutilitiesintermsofmarketcapitalisation.Wehavebroughttheenergytransitionforwardtwodecadestocombatclimatechangeandprovideaclean,reliableandsmartbusinessmodel,tocontinuebuildingtogethereachdayahealthier,moreaccessibleenergymodel,basedonelectricityVestasVestasistheenergyindustry’sglobalpartneronsustainableenergysolutions.Wedesign,manufacture,install,andservicewindturbinesacrosstheglobe,andwith+151GWofwindturbinesin86countries,wehaveinstalledmorewindpowerthananyoneelse.Throughourindustry-leadingsmartdatacapabilitiesand+129GWofwindturbinesunderservice,weusedatatointerpret,forecast,andexploitwindresourcesanddeliverbest-in-classwindpowersolutions.Togetherwithourcustomers,Vestas’morethan29,000employeesarebringingtheworldsustainableenergysolutionstopowerabrightfuture.EquinorWearelookingfornewwaystoutiliseourexpertiseintheenergyindustry,exploringopportunitiesinnewenergyanddrivinginnovationinoilandgasaroundtheworld.Weknowthatthefuturehastobelowcarbon.Ourambitionistobetheworld’smostcarbon-efficientoilandgasproducer,aswellasdrivinginnovationinoffshorewindandrenewables.Weplantoreachaninstallednetcapacityof12-16GWfromrenewablesby2030,two-thirdsofthiswillbefromoffshorewind.Withfivedecadesofoceanengineeringandprojectmanagementexpertise,focusonsafeandefficientoperations,indepthknowledgeoftheenergymarkets,skilledpersonnelandanetworkofcompetentpartnersandsuppliers,Equinorisuniquelypositionedtotakealeadingroleintheoffshorewindindustry.Frombuildingtheworld’sfirstfloatingwindfarmtobuildingtheworld’sbiggestoffshorewindfarmwearewellunderwaytodeliverprofitablegrowthinrenewablesbealeadingcompanyintheenergytransition.SSESSERenewablesisaleadingdeveloperandoperatorofrenewableenergy,headquarteredintheUKandIreland,withagrowingpresenceinternationally.Itsstrategyistoleadthetransitiontoanetzerofuturethroughtheworld-classdevelopment,constructionandoperationofrenewablepowerassetsanditisbuildingmoreoffshorewindenergythananyothercompanyintheworld.PartoftheFTSE-listedSSEplc,SSERenewablesistakingactiontodoubleitsinstalledrenewableenergycapacityto8GWby2026aspartofitsNetZeroAccelerationProgramme,andincreaserenewablesoutputfivefoldtoover50TWhannuallyby2031.CorioCorioGenerationisaspecialistoffshorewindbusinessdedicatedtoharnessingrenewableenergyworldwide.Our20+GWdevelopmentportfolioisoneofthelargestintheworld,spanningestablishedandemergingmarkets,aswellasfloatingandfixed-bottomtechnologies.Withourleadingindustrialexpertiseanddeepaccesstolong-termcapital,weworkcloselywithourpartnersinthecreationandmanagementofprojectsfromorigination,developmentandconstruction,andintooperations.CorioGenerationisaGreenInvestmentGroup(GIG)portfoliocompany,operatingonastandalonebasis.GIGisaspecialistgreeninvestorwithinMacquarieAssetManagement,partofMacquarieGroup.CIPFoundedin2012,CopenhagenInfrastructurePartnersP/S(CIP)todayistheworld’slargestdedicatedfundmanagerwithingreenfieldrenewableenergyinvestmentsandagloballeaderinoffshorewind.ThefundsmanagedbyCIPfocusesoninvestmentsinoffshoreandonshorewind,solarPV,biomassandenergy-from-waste,transmissionanddistribution,reservecapacity,storage,advancedbioenergy,andPower-to-X.CIPmanagestenfundsandhastodateraisedapproximatelyEUR19billionforinvestmentsinenergyandassociatedinfrastructurefrommorethan140internationalinstitutionalinvestors.CIPhasapproximately400employeesand11officesaroundtheworld.ReNewReNewistheleadingdecarbonisationsolutionscompanylistedonNasdaq(Nasdaq:RNW,RNWWW).ReNew’scleanenergyportfolioof~13.4GWsonagrossbasisasofDecember31,2022,isoneofthelargestglobally.InadditiontobeingamajorindependentpowerproducerinIndia,weprovideend-to-endsolutionsinajustandinclusivemannerintheareasofcleanenergy,greenhydrogen,value-addedenergyofferingsthroughdigitalization,storage,andcarbonmarketsthatincreasinglyareintegraltoaddressingclimatechange.GWECGLOBALWINDREPORT2023117LincolnElectricBryanO’Neil(Bryan_ONeil@lincolnelectric.com)HamburgMesseinfo@windenergyhamburg.com(WindEnergyHamburg)HartingElectricGuanghaiJin(Guanghai.Jin@harting.com)TechstormMartijnvanBreugel(martijn@techstorm.com)BureauVeritasPaulTrevillyan(paul.trevillyan@bureauveritas.com)GWECGLOBALWINDREPORT2023117AppendixAssociateSponsorsLeadingSponsorSupportingSponsor4/02/1115:40:22GlobalWindEnergyCouncilRuedeCommerce311000Brussels,BelgiumT.+32490568139info@gwec.net@GWECGlobalWind@GlobalWindEnergyCouncil(GWEC)@GlobalWindEnergyCouncilwww.gwec.netGLOBALWINDENERGYCOUNCIL

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