Offshore wind Market Synopsis

Offshore wind Market Size Was Valued at USD 4010.34 Million in 2023 and is Projected to Reach USD 11575.88 Million by 2032, Growing at a CAGR of 12.5% From 2024-2032.

Offshore wind power or offshore wind energy is the generation of electricity through wind farms in bodies of water, usually at sea.

• Offshore wind farms are created to utilize the wind's energy for the production of electricity. Turbines located in bodies of water, usually in the sea, experience more powerful and consistent winds compared to those on land, resulting in a high level of efficiency in generating electricity.
• Offshore wind farms assist in decreasing reliance on limited fossil fuels and greenhouse gas emissions by offering a dependable source of renewable energy. Offshore wind farms generate employment in a range of industries such as engineering, construction, manufacturing, and operations. This helps the economy by creating jobs and encouraging growth in nearby businesses.
• Offshore wind power is an environmentally friendly energy source that greatly decreases carbon emissions in comparison to traditional methods of power generation. This assists in fighting against climate change and enhancing air quality.
• Offshore wind helps enhance a nation's energy security by varying the energy sources and decreasing reliance on foreign fuels. It guarantees a consistent energy supply that is not influenced by the fluctuations in worldwide fuel markets. Offshore wind farms with smart grid technologies to improve the distribution and management of electricity. This improves the dependability and adaptability of the power system.
• The advancement of offshore wind technology spurs creativity in fields like turbine design, installation techniques, and maintenance plans. This results in progress that can be used in different industries. Progress in technology has resulted in the creation of floating wind turbines suitable for installation in deeper seas. The extension into previously unattainable regions enhances the opportunity for wind energy generation.

Source: Company Database

• Offshore wind energy capacity worldwide has been on a continual annual growth since 2019. In 2023, the global offshore wind capacity reached 72,663 megawatts, an increase compared to the previous year. In 2021, more than 21,000 megawatts of offshore wind power were newly installed and connected to the grid.

Top Active Players Involved Are:

“Siemens Gamesa Renewable Energy (Spain), Vestas Wind Systems A/S (Denmark), GE Renewable Energy (USA), MHI Vestas Offshore Wind (Denmark/Japan), Ørsted A/S (Denmark), Equinor ASA (Norway), Copenhagen Infrastructure Partners (Denmark), Iberdrola S.A. (Spain), Nordex SE (Germany), Senvion S.A. (Germany), SSE Renewables (UK), EnBW Energie Baden-Württemberg AG (Germany), EDP Renováveis (Portugal), Avangrid Renewables (USA), EDF Renewables (France), RWE Renewables (Germany), Shell New Energies (Netherlands), TotalEnergies (France), BP Alternative Energy (UK), ENGIE (France), WPD Offshore (Germany), Northland Power (Canada), Maple Power (Canada), Masdar (UAE), China General Nuclear Power Group (China). and Other Active Players and Other Active Players.”

Offshore wind Market Trend Analysis

Increasing Global Investments in Renewable Energy

• The rising international investments in renewable energy are an important factor in increasing the offshore wind market. As nations globally initiate ambitious climate objectives and the need to decrease greenhouse gas emissions, the shift to clean, renewable energy sources such as offshore wind has taken center stage. The reason for this change is complex, including environmental, economic, and strategic factors.
• The need to address climate change has increased funding for renewable energy technologies from an environmental perspective. Offshore wind presents a practical choice for fossil fuels by utilizing the steady and strong sea winds. Its ability to greatly decrease carbon footprints while maintaining energy output is in line with the worldwide effort towards achieving net-zero emissions.
• The renewable energy industry, particularly offshore wind, is showing itself to be a secure area for financial investments. Due to technological advancements and increased scale, the expense of building and running offshore wind farms is decreasing, which allows them to compete more effectively against conventional energy sources.
• Many countries are utilizing offshore wind power to improve energy security through diversifying their energy sources and decreasing reliance on imported fuels. This enhances national resilience and also establishes countries as front-runners in the green economy, drawing more investment and encouraging innovation in the industry.
• The growth of offshore wind farms is leading to job creation, boosting local economies, and promoting technological progress in turbine design, installation techniques, and grid connection. These factors, along with the worldwide effort for sustainable development, are driving a positive cycle of expansion in the offshore wind industry. Hence, in this way Increasing Global Investments in Renewable Energy acts as a Driver in the Offshore wind Market.

Reduced Cost of Wind Energy

• The decreased price of wind power, especially in offshore areas, offers a convincing chance for market growth and economic sustainability. Due to technological advancements and increasing economies of scale, the price of producing offshore wind farm electricity has significantly dropped, turning it into a strong participant in the worldwide energy combination.
• Innovation in turbine technology is a major factor in driving down costs. Bigger, more effective turbines can now harness increased wind energy with reduced materials, leading to decreased capital costs per unit of power produced. Furthermore, by utilizing lighter and stronger materials, maintenance and operational costs are reduced, ultimately decreasing the overall energy production expenses.
• The advancement in methods and tools for installation. The creation of custom ships and techniques for installing turbines and foundations has made the construction process more efficient, cutting down on time and costs for establishing offshore wind farms. This increase in efficiency is vital because it has a direct impact on the overall economic feasibility of the project.
• Progress in grid integration and energy storage technology also have an impact. Storing extra energy and supplying it to the grid during peak demand prevents offshore wind farms from wasting energy, increasing their financial appeal. combining offshore wind with other renewable sources and conventional power plants can enhance the energy mix, resulting in a more reliable and efficient grid.
• The increasing number of countries establishing ambitious renewable energy goals, the need for offshore wind energy is also on the rise. This has resulted in an increase in competition among developers, which has reduced costs through competitive bidding procedures. offshore wind power now has lower costs when compared to, traditional energy sources in numerous regions. Hence, in this way, the Reduced Cost of Wind Energy acts as an opportunity in the Offshore Wind Market.

Offshore wind Market Segment Analysis:

The offshore wind market is segmented on the basis of Component, Location, Foundation Type, Capacity, Farm Type, And Application.

By Component, Turbine Segment Is Expected to Dominate the Market During the Forecast Period

• The market dominance of the turbine segment is due to various key factors that emphasize its importance and potential for ongoing growth. Advancements in turbine technology have enhanced efficiency, reliability, and performance, making turbines more appealing to industries like power generation, aerospace, and automotive. The advancement of lighter materials and improved designs has allowed turbines to run at elevated temperatures and pressures, boosting their efficiency and reducing maintenance and operational expenses.
• The growing worldwide interest in sustainable energy has increased the need for turbines, especially in the wind and hydroelectric industries. As nations strive to decrease their carbon footprints and enhance their renewable energy capacity, turbines have become an essential part of these initiatives. Wind turbines play a vital role in utilizing wind's kinetic energy for power generation, while hydro turbines transform the kinetic energy of water into electricity. Both programs need strong, effective turbines to optimize energy conversion rates and reduce environmental effects.
• The aerospace sector's ongoing focus on enhancing fuel economy and performance has resulted in advancements in turbine engine technology. Modern gas turbine engines, found in current aircraft, have progressed to be more economical with fuel, quieter, and able to produce greater thrust relative to their weight. This has not just elevated the aviation sector's eco-friendly reputation but also improved the travel experience for passengers and efficiency for airlines.
• The continuous demand for dependable and effective power production in the industrial field strengthens the turbine sector's control of the market. Turbines are essential in converting thermal energy to mechanical energy, whether in steam turbines in conventional power plants or gas turbines in combined cycle power plants, ultimately producing electricity. Hence, in this way By Component, Turbine Segment Is Expected to Dominate the Offshore Wind Market.

By Location, Shallow Water Segment Held the Largest Share In 2023

• The shallow water sector has historically dominated the offshore wind market because of various factors as in shallow waters, there is a steadier and more affordable base for setting up and running offshore wind turbines. The ocean floor is usually more solid, making it better for building fixed-bottom foundations that are cheaper and easier to install compared to floating platforms required in deeper seas. This lowers the total expenses for building and upkeeping, thus increasing the economic feasibility of shallow-water wind farms.
• The shallow water sites frequently offer better weather conditions and calmer seas, which are essential for the effectiveness and durability of wind turbines. Less wave action and gentler winds in shallower waters mean less strain on the turbines, resulting in decreased maintenance needs and increased operational availability. These conditions also make it simpler and safer to move and set up the large parts of the wind turbines during installation.
• Shallow waters are generally located nearer to the coast, resulting in lower expenses and a simplified process of linking the wind farm to the current electricity grid. Lesser distance in transmission lines leads to decreased costs in cabling and infrastructure, along with minimized electrical losses during energy delivery. The wind farms near the shore have the advantage of being easily accessible for maintenance and repair crews, allowing them to quickly and efficiently address any technical issues that may arise.
• Deep-water sites, which may harbor sensitive marine ecosystems, typically have stricter environmental regulations than shallow-water sites. shallow water sites are typically found within a country's territorial waters, removing the necessity for intricate and lengthy international agreements or permits. Hence, in this way By Location, the Shallow Water Segment Held the Largest in the Offshore Wind Market.

Offshore wind Market Regional Insights:

Europe is Expected to Dominate the Market Over the Forecast Period

• The reason why Europe leads the offshore wind market is due to a combination of strategic, technological, and environmental factors that have established the region as a top player in this growing industry. Europe has been a leader in the implementation of renewable energy, motivated by a dedicated focus on sustainability and a forward-thinking approach to addressing climate change. This dedication has resulted in strong policy structures promoting the growth of renewable energy sources, which include offshore wind as a key component.
• Europe's geographic advantage is one of the main factors contributing. The North Sea, which is adjacent to multiple European nations, offers optimal conditions for offshore wind farms thanks to its shallow waters and reliable wind patterns. This has made it easier to install fixed-bottom turbines, which are more affordable and simpler to deploy than floating turbines needed for deeper waters. The favorable factors in the North Sea have allowed for the development of many large wind farms and have also drawn substantial investments from companies at home and abroad.
• The research and development by European countries, resulting in technological progress that has lowered the expenses of offshore wind power and improved its effectiveness. Improvements in turbine design, installation methods, and maintenance approaches have increased the feasibility and competitiveness of offshore wind energy when compared to conventional fossil fuels.
• The regulatory framework in Europe has also been key in driving the expansion of the offshore wind industry. Measures such as feed-in tariffs, renewable energy goals, and advantageous tax benefits have created a steady and appealing environment for investors. Hence in this way, Europe is Expected to Dominate the Offshore Wind Market.

Offshore Wind Market Active Players

• Siemens Gamesa Renewable Energy (Spain)
• Vestas Wind Systems A/S (Denmark)
• Ge Renewable Energy (USA)
• MHI Vestas Offshore Wind (Denmark/Japan)
• Orsted A/S (Denmark)
• Equinor Asa (Norway)
• Copenhagen Infrastructure Partners (Denmark)
• Iberdrola S.A. (Spain)
• Nordex Se (Germany)
• Senvion S.A. (Germany)
• SSE Renewables (UK)
• ENBW Energie Baden-Württemberg Ag (Germany)
• EDP Renováveis (Portugal)
• Avangrid Renewables (USA)
• EDF Renewables (France)
• RWE Renewables (Germany)
• Shell New Energies (Netherlands)
• Totalenergies (France)
• BP Alternative Energy (UK)
• Engie (France)
• WPD Offshore (Germany)
• Northland Power (Canada)
• Maple Power (Canada)
• Masdar (UAE)
• China General Nuclear Power Group (China) and Other Active Players

Key Industry Developments in the Offshore Wind Market:

• In June 2024, the Netherlands to Launch a New 4 GW Offshore Wind Tender in Q3 2025. The Dutch government plans to invite tenders for two new offshore wind sites, IJmuiden Ver Gamma and Nederwiek 1. The two areas will add a further 4 GW of offshore wind capacity to the grid in the Netherlands. The procedure for granting permits for the two offshore wind farms has now been established and detailed by the Dutch Minister of Economic Affairs and Climate Policy in a Letter to Parliament issued on 31 May. This tendering setup is being considered due to the deteriorated market conditions, according to the Netherlands Enterprise Agency (RVO).
• In April 2024, The Hai Long Offshore Wind Project announced the official launch of offshore construction. Hai Long has obtained all relevant permits, and key components for the wind farm are arriving at the marshaling port, Taiwan's first locally built large offshore wind turbine installation vessel with a 360-degree rotating crane, Green Jade, will lead the way in the first phase of construction off the coast of Changhua. The vessel will fly the Taiwanese flag and feature an exceptional combination of transport and load capacity, with a 4,000-ton main crane, and DP3 dynamic positioning system, suitable for carrying out transportation and installation works for wind turbine foundations and substations on the Hai Long Offshore Wind Farms.