Global offshore wind O&M market to reach € 10 billion by 2029
The global offshore wind operations and maintenance (O&M) market is expected to grow 16 per cent annually and reach € 10 billion by 2029. Europe will remain the biggest O&M market by region, while China will become the biggest single market in terms of national markets.
This is according to the latest report from Wood Mackenzie, which shows that European countries will together create a € 5.5 billion O&M market by 2029, while China’s will be worth € 1.7 billion by that time. Growing markets in Asia and the U.S. are also bringing opportunities for domestic industry as well as international investors.
The O&M market will grow as manufacturers dedicate more resources to O&M services for newer and larger turbines, but also create significant opportunity for independent service providers with the ageing turbine fleet.
The report states that currently only 1.8 GW of global installed offshore wind capacity has been operating for over ten years and, by 2029, 20 GW will have been in operation for more than a decade, along with 165 GW of operational offshore wind capacity that will still be under ten years old.
“Design and fabrication innovations that accommodate the rapid increase in turbine capacity must be met with equally innovative O&M practices, as turbine complexity and project scale continue to soar”, said Wood Mackenzie research associate Finlay Clark. “China, who is set to become the single largest offshore wind O&M market globally, must tread carefully”.
“China’s young and rapidly growing fleet will require sweeping changes in asset management strategy to deal with massive uptake throughout the 2020s”, said Shimeng Yang, Wood Mackenzie’s senior analyst.
China will see 41 GW of growth throughout the 2020s, leading to a total of 49 GW capacity, equivalent to € 1.7 billion of opex opportunities by 2029, according to Wood Mackenzie, which pointed out that the country is expected to overtake UK’s position as world’s largest single offshore wind O&M market.
Multiple market reports have lately highlighted the fast growth of the Chinese offshore wind market, as the country is now leading in building new offshore wind farms. As reported recently, the country is ramping up its offshore wind installation since after 2021 it will begin phasing out feed-in-tariffs, and many developers are therefore pushing to complete projects during the coming period.
“China’s enthusiasm for offshore wind has led to a rushed boom in installations. Coupled with the expiration of national subsidies for wind power, offshore operators in China will face considerable operational challenges to ensure the profitability of their projects”, Wood Mackenzie states.