Forecasts project sustained growth, but at a slower pace

Source: Daniel Cusick, E&E reporter • Posted: Wednesday, March 28, 2012

Global wind turbine suppliers
by market share, 2011
Ranking Company Country
1 Vestas Denmark
2 Goldwind China
3 GE Wind United States
4 Gamesa Spain
5 Enercon Germany
6 Suzlon India
7 Sinovel China
8 United Power China
9 Siemens Germany
10 Mingyang China
Source: Navigant/BTM Consult.

Even with projected slower growth after 2012, wind energy could account for as much as 8 percent of the world’s electricity production by 2021, up from the current 2.26 percent of current global electricity production, a new report from the international consulting firm Navigant has found.

At the same time, the “International Wind Energy Development: World Update 2011” revised its five-year cumulative growth projection downward by 14 percent from last year’s report to an estimated 269,845 megawatts of total wind power capacity by 2016.

The projected growth rate for annual installations over the five-year forecast period also was revised downward to 10 percent, according to the report, reflecting tougher economic conditions and the loss of government subsidies in a number of producing countries.

For 2012, Navigant predicts 3.5 percent annual growth over 2011, when a record 41,712 MW of wind energy came online. By the end of 2016, Navigant expects the annual capacity expansion to surpass 68,000 MW per year.

“Despite a downgrade in the growth rate for the next five years, global growth will continue,” the report says, adding that while global demand drivers will remain strong, “profiles vary from region to region.” Many experts have noted that the United States will lag behind China, India and other Asian countries in annual growth.

China creates head winds for competitors

“In Asia (India and China), the drivers are strong economic growth and the need for electricity; in Europe, the driver is determined political action to combat global warning; and in the U.S., the drivers are a mix of global warming and security of supply,” Navigant said in a press release.

Navigant’s findings were similar to those published yesterday in a similar report from MAKE Consulting, though MAKE was more bullish on the industry’s 2012 prospects, projecting a 24 percent year-to-year growth from 2011. That growth was expected in traditional U.S. and European markets, as well as in emerging markets like Mexico, Brazil and Australia.

The report, compiled by Navigant subsidiary BTM Consult of Denmark, predicts that China will flex its economic muscle in global wind energy markets over the coming years, with four turbine suppliers — Goldwind, Sinovel, United Power and Mingyang — challenging industry heavyweights Vestas, GE Wind, Siemens and Gamesa for market dominance.

China is also expected to build on its leading market position for total installed capacity. The country installed 17.6 gigawatts of wind power generation in 2011.

A report issued last month by Ernst & Young found that China is the most attractive country in the world for renewable energy investment due to government subsidies for both wind and solar power. The United States ranked second in the Country Attractiveness Indices report, while Germany and India ranked third and fourth, respectively (ClimateWire, Feb. 29).

Experts have noted that traditionally strong wind energy markets in Europe and the United States are expecting slower growth as government subsidies are lifted or expire. Europe, however, can expect offshore wind turbines to account for a greater share of total renewable energy, Navigant found.

The MAKE Consulting report notes that U.S. wind energy producers will also face stiff competition from inexpensive shale gas.