Offshore wind energy is wind power generated in coastal waters by wind turbines mounted on fixed or floating structures. Offshore wind farms allow the installation of wind turbines in deep waters, where winds are stronger and more consistent compared to land. This results in higher energy production. Offshore wind farms contribute significantly to greenhouse gas reduction as wind energy is a clean source of renewable energy.
The global Offshore Wind Energy Market is estimated to be valued at US$ 5.78 Bn in 2023 and is expected to exhibit a CAGR of 18% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the primary drivers contributing to the offshore wind energy market size growth is stringent government policies and regulations towards adoption of renewable energy sources. Growing investments in the expansion of offshore wind projects globally is also fueling market growth. For instance, according to U.S. Department of Energy, offshore wind capacity in the U.S is projected to grow from 42 MW currently to 30 GW by 2030 creating opportunities for offshore wind developers. Technological advancements in larger turbines and floating substructures are making deeper waters viable for offshore wind development further propelling market growth over the forecast period.
Threat of new entrants: The offshore wind energy market requires huge capital investments in setting up projects and infrastructure, making entry difficult for new players.
Bargaining power of buyers: Power utilities and governments are the major buyers in this market. Growing demand for renewable sources of energy increases their bargaining power.
Bargaining power of suppliers: A few turbine manufacturers dominate the supply market. However, technological advancements have increased competition among suppliers.
Threat of new substitutes: Onshore wind and solar energy can partly substitute offshore wind, but they have limitations in space and consistency of power generation.
Competitive rivalry: Major players compete on the basis of technological innovations to improve efficiency and reduce costs.
The global offshore wind energy market is expected to witness high growth, exhibiting CAGR of 18.% over the forecast period, due to increasing investments in renewable energy sources across regions.
Regional analysis: Europe dominates the market currently, driven by supportive policies in countries like the UK, Germany, Belgium, Denmark and Netherlands. Asia Pacific is expected to be the fastest growing market with China, Taiwan and Japan investing heavily in offshore capacities.
Key players: Key players operating in the offshore wind energy market include Siemens Gamesa Renewable Energy, Vestas Wind Systems A/S, MHI Vestas Offshore Wind, Ørsted A/S, EDP Renewables, RWE Renewables, Equinor ASA, China Three Gorges Corporation, Envision Energy, Goldwind Science and Technology Co., Ltd. These players are focusing on technological innovations to reduce costs and increase turbine efficiencies.