Global offshore wind projects have faced significant headwinds due to recent inflationary pressures and supply chain disruptions, such as deferred permitting processes, delayed auctions and slow supply chain buildout. Despite these challenges, the sector has weathered challenges in 2023, recording a 7% increase in new capacity additions year-on-year. This momentum is expected to accelerate this year, with new capacity additions expected to grow 9% to over 11 gigawatts (GW) by year-end. Rystad Energy expects this growth to continue at a steady pace for the offshore wind sector, estimating that global installations, excluding mainland China, will exceed 520 GW by 2040.
Europe will play a critical role in this growth, relying heavily on floating wind to meet ambitious national targets and make the most of its abundant offshore resources. By 2040, over 70% of the world’s floating wind is expected to be installed on the continent. Although some project delays beyond 2030 are to be expected, there is likely to be strong pressure to accelerate deployment. As a result, floating wind capacity is expected to reach 90 GW by 2040, with the UK, France and Portugal at the forefront of development. Asia will also play a key role in advancing floating wind as a mature technology, and the region – excluding mainland China – is expected to reach a 20% share of global installations by 2040.
While the floating wind sector has seen a recent increase in project announcements, the sector is currently battling supply chain constraints similar to those in bottom-fixed installations, where wind turbines are installed on fixed foundations in shallow waters. These challenges could hamper the advancement of floating wind technology in the short term, with capacity estimates by 2030 at less than 7 GW. To overcome these hurdles, increased government support is critical.
The global offshore wind sector is experiencing robust growth, driven by increased investment and auction activity, but supply chain bottlenecks pose significant challenges to the industry’s continued expansion. While ambitious targets will boost investor confidence, addressing logistical issues is critical to ensure offshore wind can successfully play a key role in the energy transition. This will not only help mature the technology, but also foster a supportive ecosystem that will boost investor confidence.
Petra Manuel, Senior Offshore Wind Analyst, Rystad Energy
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In the fixed-bottom-price market, we expect the UK, Germany and the Netherlands to emerge as the three dominant players. These countries’ proximity to the North Sea and extensive marine areas provides a solid foundation for offshore wind’s success, supported by their installation and net-zero targets. Together, these three countries are expected to have a total installed capacity of 150 GW by 2040, followed by the US with less than 40 GW. The future of the US market depends on the political landscape. There are concerns that the administration of presumptive Republican presidential candidate Donald Trump could significantly hinder offshore wind development if he wins the election.
Between 2025 and 2030, the Americas, led by the US, will experience significant growth, starting with nearly 2 GW of installed capacity in 2025. Asia, excluding mainland China, will follow with 7 GW in 2025 and nearly 28 GW by 2030, with Taiwan (China), South Korea and Vietnam emerging as major markets in the region. Europe is forecast to have 41 GW of installed capacity by 2025 and more than 112 GW by 2030, driven by a steady stream of projects awarded through competitive auctions.
Growth is expected to increase in Asia (excluding mainland China) between 2030 and 2035, followed by the Americas and Europe. During this period, Latin America, particularly Brazil and Colombia, are also expected to contribute to offshore wind capacity in the Americas.
Rystad Energy’s long-term forecast for the floating wind sector differs significantly from the upward trend seen in the fixed bottom price market. From 2025 to 2030, we expect only Asia and Europe to actively install floating wind. By 2030, we expect Europe to have installed almost 5 GW of floating wind, while Asia (excluding mainland China) is expected to add 2 GW.
Over the subsequent five-year period from 2030 to 2035, we expect installations to increase significantly. In Europe, 20 GW of floating wind is expected to be installed, while in Asia (excluding mainland China) up to 5 GW. In other regions, we only expect floating wind to be installed between 2035 and 2040, when the technology is mature. By 2040, we forecast that Europe will have over 65 GW of floating wind installed, while in Asia (excluding mainland China) installations will reach 17 GW.
From Rystad Energy
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