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14/02/2018

Bigger Turbines, Better Economics, More Digitization on Deck for 2018 Wind Power Market

As we enter 2018, here’s a high-level overview of which wind energy trends to keep your eye on in the coming year

By almost all estimates, 2018 should mark continued steady rise of onshore wind in mature markets coupled with a strong progression in emerging markets as wind energy cements its position as a mainstream energy technology.

After passing a major milestone in June 2017, of 500 GW of wind capacity installed, the most recent Global Wind Energy Council’s (GWEC) Outlook provides a bright forecast for wind, with its Moderate Scenario pitching global new installations reaching almost 80 GW/year and a total installed capacity of 797 GW by 2020 up from around 60 GW/year in 2017 (see Fig. 1).

With $112.5 billion invested through 2016, the sector, which employs over 1.2 million people, stands out as one of the fastest growing industrial segments in the world, and “a major driver” in the global energy transition, according to Steve Sawyer, secretary general of the GWEC.

The industry continues to see innovation across a range of metrics. A staple example: turbine capacity continues to increase — in Europe, more than 90 percent of new onshore turbines that were ordered through the first half of 2017 were larger than 3-MW. That most major OEMs will begin installation of 4-MW machines through 2018 indicates this trend will persist.

Recent industry focus on low-wind generation is coming to fruition too, opening wind power up to previously untapped markets in new places.

These developments are contributing to the increasing competitiveness of wind against other forms of generation, new and conventional alike. A 2016 report from the investment firm Lazard estimates the levelized cost of unsubsidized wind electricity in the U.S. at $32-$62 per MWh. Meanwhile, Bloomberg New Energy Finance’s New Energy Outlook 2017 predicts the levelized cost of onshore wind will nearly halve by 2040.

Against this context, Sawyer describes two important tipping points in the transition to renewables. The first, he says, we’re already in the midst of: “In many places onshore wind is the cheapest way to bring new capacity onto the grid — the major competition is solar PV, so that’s what we like to see.”

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