The global move to offshore wind farm development is enabling nations to accelerate wind energy adoption while reducing reliance on land-based power grids. Offshore wind turbines are subjected to fiercer winds and require larger turbines than land-based wind initiatives. But these benefits typically can increase the overall cost of offshore manufacturing and maintenance of wind turbines. Capital costs are approximately 30-50% higher than onshore, due to larger machine size and the costs of transporting and installing at sea. These expenses are partially offset by higher energy yields - as much as 30%. But many countries are finding the benefits to offshore outweigh these added expenditures. Offshore wind energy has a reduced effect on the environment and higher wind speeds at sea result in increased energy production.
Leading wind energy producers in Europe, Asia, and the Americas are embracing offshore as an important component of future expansion and adoption of renewable energy use. The first large offshore wind farms are well in development in several European countries. Developing offshore wind can enable these nations to achieve competitive electricity markets, reach a larger degree of energy inde¬pendence, and ensure lower and more predictable overall project costs. This SBI Energy report, Offshore Wind Farm Manufacturing Worldwide explores the revenue generating potential for companies involved in this burgeoning renewable energy area.
Read an excerpt from this report below.
Market Insights: A Selection From The Report
Chapter 3 Global Activities inOffshore Wind Energy
Companies involved in the manufacturing and distribution of products related to offshore wind energy are expecting 2010 to be a highly productive year as many global projects come to fruition and others get underway. Nations eager to accelerate their offshore wind energy commitments have been challenged by weakened economies since late 2008. But with signs that the global recession is waning, coupled with an influx of economic stimulus funds and tax breaks for renewable energy initiatives, manufacturers are preparing for a surge in production of offshore wind turbine components. They are focusing their efforts on shoring up inventories and securing business contracts in regions where offshore wind energy projects are expected to grow during the next five year. This chapter examines the global trends and activities among countries that are embracing offshore wind as a viable renewable energy source. Offshore wind currently accounts for a small amount of the total installed wind power capacity in the world - approximately 8%. But SBI Energy expects that the development of offshore wind farms will grow its share of total installed wind capacity to nearly 40% in some Asian territories by 2015. And that has manufacturers of turbine components and foundations hungry to seize this ocean of opportunity.
So far, manufacturing activity has focused on northern European counties, around the North Sea and the Baltic Sea, where about 20 projects have been implemented. But the expected benefits of higher wind speeds and the lower visual impact of the larger turbines has led many countries, particularly in Europe, to set more ambitious goals for offshore wind initiatives. Although the investment costs are considerably higher for offshore than for onshore wind farms, they are partly offset by a higher total electricity production from the turbines.
Offshore wind power will be vital for Europe’s future as it will help solve the continent’s climate dilemma by exploiting a natural resource that does not emit greenhouse gases and reduces the region’s dependence on costly fuel imports. These reasons for offshore wind farm development have been recognized by the European Commission in its 2008 Communication “Offshore Wind Energy: Action Needed to Deliver on the Energy Policy Objectives for 2020 and Beyond.” Through 2020, according to the Commission, 360 GW of new electricity capacity - 50% of current EU capacity - needs to be built to replace ageing European power plants and meet the expected increase in demand. Europe must use the opportunity created by the large turnover in capacity to construct a new, modern power system capable of meeting the energy and climate challenges of the 21st century while enhancing Europe’s competitiveness and energy independence. By 2020, the EC expects that half of public and private investments in renewable energy will go to offshore wind farms.In the News
Portugal Matures into Formidable International Trendsetter with Sweeping Clean Energy Initiatives
New York, September 1, 2010 - As countries around the world scramble to create, deploy, and sustain clean energy adoption initiatives, few have done so with the gusto of Portugal. The country is quickly emerging as a “green” trendsetter due to its determination to reduce its dependence on imported fossil fuels by channeling its wind, solar, and hydropower resources and by improving smart grid capabilities and exploring the use of electric vehicles—even though such clean energy transitions have come at substantial financial costs.
“Germany is well-regarded as a green energy leader with its hefty share of the total installed wind energy capacity in Europe. But it’s Portugal that has us excited, and we anticipate enormous growth in the country’s generation of wind power due in large part to government stimulus incentives,” says Shelley Carr, publisher of SBI Energy, which released the market study Offshore Wind Farm Manufacturing Worldwide in April 2010. “Though Portugal’s efforts come at a price, one must remember that this is a region with prodigious wind and water power resources, both of which are widely regarded as the most cost-effective to harness.”
In terms of world numbers for smart meter installations, some industry estimates see a fivefold rise—from roughly $50 million in 2010 to $250 million by 2015. Much of this huge and rapid increase in smart meter installs will take place in Europe, according to SBI Energy’s Smart Grid and Consumers Other sources reveal that five years ago only 17% of Portugal’s smart grid power originated from clean energy resources, but that number could rise to almost half of the nation’s smart grid power by the end of 2010.
Meanwhile, Portugal is making progress on the electric vehicle front. “There is tremendous optimism that Portugal could become the first nation with a national network of charging stations for electric cars,” says Carr. SBI Energy’s Electric Vehicle (EV) Infrastructure Manufacturing reveals that the European-Union sponsored Sagittaire is running demonstrations of hybrid buses in eleven cities across France, Spain, Portugal, Norway, and Italy. In each city, the hybrid-electric bus fleet will be tested under different operational and practical conditions. In addition, Portugal is involved in the Renault-Nissan Alliance’s zero-emissions vehicle initiatives that are sweeping Asia and the United Kingdom, France, Switzerland, Ireland, Israel, Denmark, and Monaco.
And with automakers in Europe planning new business models for electric vehicles and plug-in hybrids before 2011 that could completely overhaul its electric vehicle transportation infrastructure by eliminating the need for gas stations and relinquish fueling responsibilities to utility companies, Portugal has steadfastly proven itself a willing participant and test projects are in development for the country.
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Six Clean Energy Markets That Will Change Life As We Know It in the Next Five Years
New York, August 26, 2010 - Renewable energy is receiving a big push from the Obama Administration and from governments around the globe. Stimulus packages and government incentives for green technology has created jobs and established new industry, which in turn has sparked a brighter outlook on the world's economy. Going into 2011 and beyond, SBI Energy has identified six clean energies that will not only gain double-digit growth in the next five years, but will also alter the lifestyle we know today.Green Building Materials and Construction - Traditional construction creates considerable debris which ends up in our landfills, soil and fresh water supply. Furthermore, inefficient materials used in construction produce higher energy bills for the homeowner. The judicious use of recycled materials, lumber that is harvested from sustainable forests, more efficient insulation and windows, and improved construction techniques can drop energy bills for consumers while reducing the need for raw materials simultaneously. Market research performed by SBI Energy forecasts the size of the global green building materials market to grow to over $580 billion by 2015 from about $160 billion in 2010. This represents a growth rate of 21% CAGR which is significant but understandable in light of increasing demand for products that save energy and minimize harmful environmental effects. Enhanced Oil Recovery EOR refers to a variety of oil producing methods, by which 70% - 90% more oil is produced from oil wells than is typically extracted by conventional oil production methods. Some of the more common EOR methods include steam, gas or chemical injection, which improve the viscosity of the oil, enabling the oil to flow more freely out of the well. More oil indicates lower prices. SBI Energy estimates dollars from EOR will climb steadily with some gentle fluctuations. SBI's analysts calculate the EOR market will experience a compound average growth rate (CAGR) of 63% per year over the 6-year span to total $1.3 trillion in 2015.
Solar Technology - We've all seen the solar panels on residential home roofs and today energy providers are multiplying this concept by installing large solar farms and using concentrated solar power (CSP) technology to supplement power demands. Electricity from CSP technology is generated like conventional electricity, except solar power is used to heat the boiler instead of fossil fuels. Global CSP installations are just getting started and SBI Energy expects to see real growth in the segment beginning in 2012.CSP is the fastest growing segment within the solar technologies, going from $0.7 billion in 2010 to $3 billion in 2014, a CAGR of 42% for the period. Including systems and panels, SBI Energy sees the world solar market growing to $173 billion in 2014 - a CAGR of 28%.
Offshore Wind Farms - Coastal area will have a new view as nations increasingly harness the renewable energy generated by the fierce winds a few miles off their shorelines. During the next five years, SBI Energy expects offshore wind farms to crop up at a much faster pace than land-based turbines. Leading manufacturers of turbines and components are riding the wave of production expected to result from growing interest in offshore projects, such as the recent approvals of Cape Wind in Massachusetts and The Offshore Wind Economic Development Act in New Jersey. Helping them accelerate their offshore initiatives are government cash and tax incentives that promote renewable energy development, particularly in Europe and the U.S. "States are leading the way in off-shore wind development because it spurs economic development, helps to stabilize energy costs, and moves our country towards energy independence in a sustainable fashion," comments Donald Carcieri Governor of Rhode Island. SBI Energy forecasts the global market to grow at a five-year CAGR rate of 11% to reach more than $78 billion. The fastest growth will come from the U.K., which will more than double its offshore market value to reach nearly $5 billion in 2015.
Electric Vehicles - For years the marketing and advertising from government and car companies alike have boldly stated that electric cars will take over the car industry “real soon now.” Now, electric vehicles, in the form of hybrids that combine both gas and electric motors, are finally beginning to do just that. The world populace is accepting hybrid electric vehicles, giving them equal weight as an option in their car purchases. Just how quickly this market will grow depends on several factors including gas prices, government incentives and vehicle price. According to market research from SBI Energy worldwide hybrid electric vehicle sales will double from just under 700,000 units sold in 2009 to 1.5 million passenger hybrid vehicles sold in 2014. Exponential HEV market growth will occur in smaller existing markets such as Europe, Australia and South Korea, and in new markets such as India and China where product sold will increase from 95,000 vehicles in 2010 to 440,000 vehicles in 2014, a phenomenal 47% compound annual growth rate.
Smart Grid Technologies - Implementing and integrating all of the renewable energies is somewhat contingent on the upgrade of our existing dilapidated 100 year old electrical grid to a powerful sophisticated smart grid system. The smart grid can be seen in broad outline as an architectonic structure consisting of three major sectors: grid infrastructure; information and communications technology (ICT); and applications and software (A/S). Despite consumer concerns over privacy and cost regulation, the smart grid will encourage clean energy production and ensure reliable electrical supply to the world through digital grid operation and a distributed network. SBI Energy sees the global smart grid market soaring upward nearly 150% between 2009 and 2014, reaching $171 billion in 2014. Meanwhile, the U.S. market is projected to double over the timeframe to about $43 billion by 2014.
SBI Reports has been leading industrial market research reporting for more than a decade. The brand established SBI Energy to address the complex nature of the Energy and Resources industry. SBI Energy reports capture data vital to emerging energy market sectors on a global scale. Growth of energy technology, manufacturing, construction, transportation and investment is exciting in its innovations and opportunities, and integral to the advancement of security and science. SBI relies upon only the most experienced analysts with excellent credentials, years of industry experience, and the trust of colleagues and peers.
Research for this article is based on the following market studies from SBI Energy:
EOR Enhanced Oil Recovery Worldwide
Electric Vehicle (EV) and Plug-In Hybrid Electric Vehicle (PHEV) Markets Worldwide
Smart Grid and Consumers
Global Green Building Materials and Construction, 2nd Edition<
Offshore Wind Farm Manufacturing Worldwide
U.S. Solar Energy Market World Data, 2nd Edition: PV, Solar Thermal, CSP
# # #In the News
Favorable Wind Blowing for Offshore Wind Energy Markets
New York, April 5, 2010 - During the next five years, the production of offshore wind farms will far outpace the production of land-based wind turbines as nations worldwide increasingly harness the renewable energy generated by the fierce winds blowing a few miles off their shorelines, according to Offshore Wind Farm Manufacturing Worldwide by leading industrial market research firm SBI Energy.
“Our analysts project that total offshore installed capacity will grow at an astounding 92% compound annual growth rate during the next five years to reach more than 79,700 megawatts,” says Shelley Carr, publisher for SBI Energy.
Guiding the accelerated interest in offshore wind initiatives are government cash and tax incentives that promote renewable energy development, particularly in Europe and the United States. In addition, the ongoing improvement in the quality of offshore wind products that can withstand stronger gusts, reduce maintenance cycles, and reduce the shipping expenses of turbines to offshore job sites are also vital to the market’s future. Meanwhile, offshore wind manufacturers will fuel growth by finding ways to reduce costs associated with offshore projects, which will subsequently attract greater investment from governments and private energy companies.
The current $47 billion total for offshore wind manufacturing represents 8% of the combined $566 billion global offshore and land-based wind energy manufacturing industry, a solid performance considering the challenges of financing offshore wind farms due to the lingering financial crisis.
Offshore manufacturing represents a sizeable percentage of total wind energy manufacturing for several nations, including India (20%) and China (17%). However, the U.S. has thus far approached offshore manufacturing conservatively with only 2% of its sales going to offshore production.
China is currently the global leader in generating sales for offshore wind energy manufacturing initiatives, garnering a 61% share of the market. Not surprisingly, multinational manufacturers are responding to the rapid growth of China’s offshore market by building turbine factories in the country, according to SBI Energy analyst Darren Bosik. Conversely, European-based companies lead the world in onshore wind energy manufacturing with a 34% market share.
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