China Continues to Lead Wind Power Development: WoodMac

China continued to have the lion's share of wind power activity across the globe in the first half of 2023 accounting for 44 gigawatts (GW) of the world's 69.5 GW of wind turbine order demand during the six months, Wood Mackenzie (WoodMac) has reported.

The global figure for order power generation capacity represented a 12 percent increase compared to the same period last year. "A big driver of this activity was orders from outside of China, which saw more than 25 GW of order demand for a 47 percent increase year-over-year through H1 [first half]", the energy insights firm said in a press release.

Orders from North America more than quadrupled to 7.7 GW from 1.9 GW in the first two quarters of last year, with two offshore projects accounting for 49 percent of wind turbine order capacity from the region in January-June 2023, according to WoodMac.

However, "China overwhelmingly remains the largest market, with 44 GW of activity in H1, but demand was flat year-over-year", it added.

Total orders in the first half of 2023 amounted to $40.5 billion, $25.3 billion of which was made in the second quarter, it said.

The surge in orders outside China "is really encouraging", commented Luke Lewandowski, WoodMac vice-president for global renewables research.

"Supply chain challenges remain, but conditions have improved enough to spark procurement decisions", Lewandowski said. "Momentum from the Inflation Reduction Act in the U.S. has helped to motivate order activity, although increasing clarity and market certainty will drive an even larger volume".

The Inflation Reduction Act, passed August 2022 with provisions for both energy security and climate resilience, allows offshore leases for wind power development, as specified in Part 5 of the law.

On August 29 the Interior Department said it had held the first-ever auction for wind energy development in the Gulf of Mexico. RWE Offshore US Gulf LLC has won the Lake Charles, Louisiana lease area with a high bid of $5.6 million, according to a department press release.

The 102,480-acre lease "has the potential to generate approximately 1.24 gigawatts of offshore wind energy capacity and power nearly 435,400 homes with clean, renewable energy", the Interior Department said. The two other lease areas offered in the auction, both located offshore Galveston, Texas, failed to attract any bid, according to the media release.

Offshore projects accounted for 12 GW or 17 percent of the total capacity of wind turbine orders in the first half of 2023, increasing 26 percent year on year and hitting a record activity. In the second quarter, offshore order capacity rose 48 percent year over year to 9.1 GW, also a record, according to WoodMac.

Lewandowski said, "Momentum had been building for some time in the offshore market and many deals had been conditional as project developers awaited approvals and permitting.

"We saw several really big deals officially reach a final investment decision in Q2 [second quarter], including orders of 2,640 MW and 1,176 MW in North America, which helped drive the record numbers and breathe some life into these markets.

"The fact that these deals became firm during a difficult time for OEM financials and amidst the cancellation of several offtake agreements for large projects is both encouraging and significant".

China-based Envision Group topped developers in terms of new order capacity in the first half with 9.7 GW. It is followed by Zhejiang Windey Co. Ltd., also of China, with 8.7 GW and Spain-based Siemens Gamesa Renewable Energy SA (SGRE) with 8.2 GW.

In the second quarter SGRE led with 5.9 GW, followed by China's Goldwind Science & Technology Co. Ltd. with 4.9 GW and Windey with 4.4 GW.

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