MAKE Consulting updates global wind market forecast

Annual growth forecast holds at 7.1 percent, Latin America remains bullish and Vestas amasses most orders in the Americas so far in 2014.

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In its latest Global Wind Power Market Outlook Update,  MAKE Consulting (Aarhus, Denmark) maintains it forecast of 7.1 percent average annual growth for worldwide wind installations from 2013 to 2023. The report indicates no change in previously predicted near-term increases as China supports a 1 GW upgrade in installations this year and as 2015 sets a new global annual grid-connected record with a projected 5.2 percent year-over-year growth.

China’s Central Government has issued a new target of at least 18 GW of new installed wind capacity for 2014. This, combined with high market activity so far this year, has led MAKE to upgrade its 2014-2016 growth expectation by 0.5 percent - offsetting net downgrades from the first quarter of 2014 in Europe, the Middle East and Africa. The report notes that a 1.6 GW cut in Ireland, offshore adjustments in the U.K., political turmoil in Ukraine, and slow market activity in Saudi Arabia contribute to a 0.8 percent decrease in the region.

The positive near-term outlook in the U.S. is forecast to hold as expectations for a production tax credit renewal through a tax extenders package this year continues. Canada’s three-year bubble is expected to stay on track, while long-term growth is dependent on upcoming elections in Ontario and the expected new energy program in Alberta by the end of the year. Although the North American growth surge is forecast for 2014 to 2016, MAKE says Latin America presents a more consistent outlook through the whole decade.

The report also projects a promising outlook for offshore wing, with an expected 20.2 percent growth on average per year from 2013 to 2023. While project-level and policy adjustments affect the near-term European offshore outlook, MAKE predicts growth beyond 2019 will improve as the market will connect, on average, at least 4 GW per year.

Wind turbine orders in first quarter 2014 increased 7.4 percent year-over-year, continuing global market recovery despite being down 43 percent from fourth quarter 2013. Among the turbine order winners were Vestas (Aarhus, Denmark) in the Americas, Siemens (Hamburg, Germany) in EMEA (Europe, Middle East and Africa) and Zhejiang Windey (Hangzhou, China) in Asia-Pacific.

MAKE says average turbine pricing remains stable from first quarter 2014, with newer technology demanding higher price points, particularly in Western markets. Increasing demand for quality in China, coupled with more aggressive government-sponsored targets, may help create a seller’s market for specific original equipment manufacturers.