Apr. 29, 2011 (Business Wire) -- As global investment in wind turbines continues to increase and a greater percentage of the world's electricity supply comes from wind energy resources, developers, manufacturers, governments, and investors are now turning their attention to offshore wind farms as a means of further expanding wind power capacity. Despite key challenges facing the industry, a new report from Pike Research forecasts that investment in offshore wind power will surge in the next several years and as a result, total installed power generation capacity will increase by a factor of seventeen between 2011 and 2017, rising from just 4.1 gigawatts (GW) of installed capacity to 70.1 GW by the end of the forecast period.
"Some of the world's best wind resources are located offshore," says senior analyst Peter Asmus. "Often, these high-potential areas are in shallow ocean waters relatively close to urban population centers. Interest in freshwater offshore wind is also picking up, especially in the Great Lakes in the United States and Canadian Midwest."
Asmus adds that Europe has been operating wind turbines offshore for close to a decade. Denmark, which already obtains more than 25% of its total electricity from wind power, is a key pioneer. Nevertheless, the United Kingdom is the current market leader in Europe. Meanwhile, Germany – despite its limited coast on the North Sea – is also investing heavily in offshore wind. The long-term offshore wind movement, however, is not limited to Europe. In fact, Pike Research's market forecast shows that China's offshore wind market will pull even with Europe's largest national leaders by 2017.
But Pike Research's analysis indicates that the offshore wind market is not without significant challenges, the most notable of which is cost. The cost of offshore wind generation is higher than for onshore wind, in some cases two to three times higher. This factor is driving the industry to deploy larger wind turbines of up to 5-10 megawatts (MW) in size in larger wind farms in order to achieve the best economies of scale. Asmus says that the long-term fate of the offshore wind power industry may ultimately hinge on driving down the cost of energy (COE) closer to 10 cents per kilowatt-hour (kWh) by 2030, less than half of the current COE. Industry players are also focused on reducing the cost of installation, supporting infrastructure, and ongoing operations and maintenance through innovations related to vessels, foundations, and the optimization of port facilities.
Pike Research's report, "Offshore Wind Power", provides an in-depth analysis of global opportunities in the offshore wind power market, as well as an examination of key challenges facing the industry. It examines technology innovations that will influence the future direction of the market, and also features detailed profiles of key industry players, including a SWOT analysis for each. Market forecasts extend through 2017 and include projections for installed capacity, installation costs, and production revenue, segmented by region and country. An Executive Summary of the report is available for free download on the firm's website.
Pike Research is a market research and consulting firm that provides in-depth analysis of global clean technology markets. The company's research methodology combines supply-side industry analysis, end-user primary research and demand assessment, and deep examination of technology trends to provide a comprehensive view of the Smart Energy, Smart Grid, Smart Transportation, Smart Industry, and Smart Buildings sectors. For more information, visit www.pikeresearch.com or call +1.303.997.7609.