Wind Faces Challenging 2015 After Record 2014
To paraphrase the great Marilyn Monroe, “Good things don’t last forever. So live it up, drink it down and laugh it off because at one point, [this] was exactly what you wanted.”
And while the great American icon may well have been talking about dating, and not wind energy, the parallels remain. Since 2014 has been hailed as a record-breaking year for global wind.
The world’s top ten turbine manufacturers benefited as countries including China, the US and Germany helped to drive record wind installations.
All the same, while growth has been good, it’s easy to feel nervous about what lies ahead. After all, there are major doubts over whether the market this year can match the level of installations in 2014 – something that will pile on the pressure for manufacturers to grow sales while increasing operational efficiencies.
In February, the Global Wind Energy Council published its global wind market statistics for 2014, which showed that new wind farms totalling almost 52GW were installed last year. This is the first time the annual figure has exceeded 50GW and is an incredible 44% increase year-on-year.
These record-breaking figures were driven by installations of more than 23GW in China, 5.3GW in Germany, and 4.9GW in the US. However, we doubt whether this activity will be matched in 2015 given that economic growth is slowing in China, and that installations in the US and Germany were boosted by companies keen to develop schemes quickly because of long-term policy uncertainty.
We’ll be interested to see if growing activity in India, Latin America and Africa helps to fill that gap.
This successful 2014 was a great fillip for the world’s top ten wind turbine makers, which are listed in FTI Consulting’s ‘Global Wind Market Update - Supply & Demand 2014’. Published earlier in February, the report showed that Vestas remained top turbine maker by installed capacity in 2014.
The rest of the top five were the same as 2013 but they changed positions. Siemens rose two places to second due to a strong year in its onshore business, while US giant GE climbed one place to fourth because it nearly doubled international installations. Goldwind and Enercon complete the top five, and the rest of the top ten included Enercon, Suzlon, Gamesa, United Power, Ming Yang and Envision. Envision was the only company new to the top ten.
These ten firms —and their smaller industry counterparts —won’t find it easy in the coming years. And few doubt that with this changing market dynamic, exceptional growth can continue infinitum.
Indeed, with governments in developed markets now reining in subsidies, some with disastrous effects (we’re looking at you, Spain!), and with slowing growth in Asia set to hit the Chinese market, industry installations will start to drop.
Indeed, FTI Consulting forecasts that the global wind market installations may even fall, past 2016.
Nothing is certain – although few disagree that as the industry continues to mature on the international stage, the days of such rapid exponential global growth will end. In such a scenario only the most adaptable and resilient will continue to thrive.