Offshore wind additions are set to hit a new high in 2024, as several newer markets, including the US, France, and Taiwan, ramp up development, according to the report "1H 2024 Offshore Wind Market Outlook" published by BNEF.
Recent cost inflation and supply chain constraints have led many developers to refocus portfolios and slow their entry into new markets, resulting in mixed outcomes in recent auctions, despite some governments offering more attractive contract terms. Offshore wind auctions are set to increase significantly, supporting strong growth, with capacity on track to rise tenfold by 2040, reaching 742 GW.
BNEF expects 18.3 GW of offshore wind to achieve commercial operation in 2024, much of it in mainland China, Taiwan, the Netherlands, and France. This marks an increase from 10.7 GW in 2023. The sector is on track for tenfold cumulative growth by 2040, the first time BNEF has extended its offshore wind forecast to this horizon. Mainland China, the UK, and the US are leading in installations.
While markets like France, Japan, and South Korea awarded offshore wind contracts at record-low prices in the last six months, auctions in the US resulted in more expensive projects. As much as 125 GW of offshore wind seabed leases and contracts are set to be awarded through the end of the third quarter of 2025, driving development through the 2030s.
After record financing activity last year, new-build deals have stalled so far in 2024. However, acquisitions are on track to reach a new record this year, as the exchange of projects in earlier development stages boosts purchased capacity.
Winning developers in France’s floating tender plan to use 24.5 MW machines, despite US and European manufacturers scaling back plans for larger turbines. GE’s abandonment of an 18 GW model was a key factor in 4 GW of US contract cancellations. However, the latest news about Siemens Gamesa is that the company is developing a 21MW offshore wind turbine. Chinese players have continued to expand outside their home market, securing orders in South Korea.
