IEA Predicts 15-fold Increase in Offshore Wind

US$1 Trillion in Investment Expected by 2040

The International Energy Agency has dramatically revised estimates for the potential of the offshore wind sector, boosting the prospects for breakbulk activity in the sector.

The findings, published as part of the IEA’s Offshore Wind Outlook 2019 report, suggest that global offshore wind capacity “may increase 15-fold” and “attract around US$1 trillion” of cumulative investment by 2040.

“Offshore wind currently provides just 0.3 percent of global power generation, but its potential is vast. More and more of that potential is coming within reach, but much work remains to be done by governments and industry for it to become a mainstay of clean energy transitions,” said Fatih Birol, IEA’s executive director.

Steep Cost Reduction

IEA highlights falling costs, supportive government policies and "remarkable" technological progress, as key drivers for the investment surge.

Larger turbines and floating foundations were of particular relevance to the changing investment profile, both of which are expected to drive a change in breakbulk requirements over the coming decade as operators must adapt to new offshore challenges.

“In the past decade, two major areas of technological innovation have been game-changers in the energy system by substantially driving down costs: the shale revolution and the rise of solar PV. And offshore wind has the potential to join their ranks in terms of steep cost reduction,” Birol said.

Synergies with Offshore Oil and Gas

Under it forecasts, IEA predicts Europe could see offshore capacity jump to as much as 180 gigawatts by 2040, while China is predicted to rise from 4 gigawatts today to 110 gigawatts by 2040.

“That’s just the start – the IEA report finds that offshore wind technology has the potential to grow far more strongly with stepped-up support from policy makers,” the report said.

The report also estimates that 40 percent of the lifetime costs of an offshore wind project, including construction and maintenance, have significant synergies with the offshore oil and gas sector, translating into a market opportunity of US$400 billion or more in Europe and China over the next two decades.