The clean energy research firm today said that onshore and offshore wind farm installations in 2010 are expected to total 37.7 GW, down 2% from 2009, but are set to bounce back to 45GW in 2011. Bloomberg New Energy Finance expects the sector to continue to grow in the years that follow, with an average of 48GW to be added in years 2012-2013.
While activity in 2010 will remain roughly even from 2009, growth rates vary widely across regions, with the rapidly growing nations of the developing world leading the way. China once again will be the global leader and will install 25% more new wind power capacity than in 2009, when the country set a record with 14,000 new megawatts.
The growth in China’s wind farm installations is underpinned by record levels of investment, which in Q3 2010 represented just under half of all funds put into new wind power projects globally. Approximately one in two wind turbines to go online in 2010 will be in China.
China’s growth in wind energy contrasts with a considerably gloomier picture in the US, where Bloomberg New Energy Finance expects installations to fall 39% in 2010 compared to 2009.
The US wind energy market continues to be challenged by fallout from the financial crisis, low power prices and an uncertain medium-to-long term policy environment.
Low natural gas prices remain a particular problem, since they bring down the cost of gas-fired electricity and therefore make it hard for wind farm project developers to negotiate attractive power purchase agreements with US utilities. The US remained relatively subdued in terms of all types of clean energy asset finance, not just in wind energy, in Q3 2010, with $4.4bn invested, down from $5.1bn in Q2.
Wind turbines prices have remained weak around the world in 2010. The latest version of the Bloomberg New Energy Finance Wind Turbine Pride index shows the median price for wind turbines ordered so far in 2010 (including towers and transport) was equivalent to $1.4m per Megawatt of capacity, down from a peak of $1.79m per Megawatt in 2008.
Bloomberg New Energy Finance expects prices to continue to fall in 2011 as wind turbine manufacturing capacity exceeds demand in all regions by a significant margin.
Bloomberg New Energy Finance is expecting to see 21% growth in installations in 2011 to 45.0 GW, with the majority of this coming from non-traditional wind power markets in Latin America and Asia.
The group is also predicting that offshore wind farm installations will more than double between 2010 and 2013, rising from 1.3 GW to 3.3 GW per year. Europe will lead the way with 80% of these wind farm installations, specifically in the UK and Germany.
Bloomberg New Energy Finance’s Short-Term (four-year) Wind Market Forecast covers 43 markets around the world for both onshore and offshore wind energy and is updated quarterly. It is derived by tracking the progress of individual wind farm projects through the planning, financing and construction cycle, taking into account developments in regulation, finance and power markets which affect whether those projects will ultimately be built.
The forecast, which is updated quarterly, forms a core part of Bloomberg New Energy Finance’s Wind Insight Service.
Michael Liebreich, chief executive of Bloomberg New Energy Finance, said: “Installation levels always lag financings, so what we are seeing this year is the effect of the collapse in investment activity at the end of 2008, beginning of 2009. Investment levels are slowly recovering in Europe and the US, but meanwhile Asia, and in particular China, have charged ahead.”
William Young, head of wind industry research at Bloomberg New Energy Finance, said: “The emergence of China as the world’s leading wind market in the last two years is driving a fundamental rebalancing of industrial focus. Chinese wind turbines manufacturers have muscled their way onto the top table, but at the same time the shift offers significant opportunities to European, US and Asian component suppliers.”