"Offshore wind capex to double to $89 billion by 2030"

" \n Offshore wind capex to double to $89 billion by 2030 \n \n\n \n Global capital expenditure (capex) on offshore wind is forecast to double to $86.9bn between 2022 and 2030, thus further closing the investment gap with offshore oil and gas, according to estimates by energy research firm Rystad.\u00a0 \n \n\n \n While high costs have slowed down investment in offshore wind, they have come down substantially in the recent past. \n \n\n \n \u201cThe one criticism of offshore wind has been that its costs are still not comparable with onshore wind and solar,\u201d Rystad\u2019s head of offshore wind research, Alexander Fl\u00f8tre, said. \u201cBut over the last decade, they\u2019ve come down quite substantially.\u201d\u00a0 \n \n\n \n According to Wood Mackenzie, offshore wind costs in mature European markets will drop 69% from 2015 to 2025. Alongside its capacity to generate higher volumes of energy than other renewables, this makes the development of offshore wind frameworks a more attractive proposition for governments. \n \n\n \n Capex crossing points \n \n\n \n With falling costs \u2014 as well as ambitious decarbonisation plans in major markets across the globe driving growing levels of investment in offshore wind \u2014 the capex gap with competitive energy technologies such as offshore oil and gas is narrowing. \n \n\n \n Back in 2015, global investment into offshore wind did not exceed $11.1bn; fast forward to 2030, and Rystad expects it to grow to $86.9bn; in the same period, capex into offshore oil and gas is expected to fall from $207.2bn to $141.6bn.\u00a0 \n \n\n \n In China and the UK, the two biggest offshore wind markets for installed capacity, the industry\u2019s annual capex has exceeded that of offshore oil and gas since 2017 and 2020, respectively. Rystad expects Europe as a whole to hit that milestone in 2026, while Denmark may do so in 2022, thanks to its tendering activity and plans for large-scale energy islands . Taking China out of the equation, the rest of Asia will hit that tipping point in 2028, driven by Taiwan, South Korea, Japan and Vietnam. \n \n\n \n \" Perhaps the most striking turnaround is the US. Despite having just 42 megawatts installed today, Rystad expects offshore wind spending to temporarily exceed offshore oil and gas in 2026 before the industries permanently part ways in the early 2030s. This is presuming the Biden Administration falls 30% short of its 30-gigawatt (GW) capacity target for 2030. \u201cIf you\u2019re an optimist on US offshore wind, there is upside to these numbers,\u201d said Mr Fl\u00f8tre. \n \n\n \n Read This: Public debt increases marginally by 0.3% on a month-on-month basis; now 77.8% of GDP \n \n\n \n Wood Mackenzie has tracked almost 700GW of capacity in the global offshore wind project pipeline \u2014 20 times more than the 35GW operating today. In recent years, China has installed the lion\u2019s share of new capacity; however, things will change once Beijing phases out feed-in tariffs from 2022.\u00a0 \n \n\n \n \u201cIn the\u00a0early 2020s, China will continue to be the fastest market in adding new capacity. But looking at the second half of the 2020s, we will see a much more globalised industry,\u201d said S\u00f8ren Lassen, Wood Mackenzie\u2019s head of offshore wind research. While today just six or seven markets are deploying commercial capacity [projects with more than 1GW of installed capacity], he expects more than 20 to be doing so by 2030. \n \n\n \n The flip side \n \n\n \n Oil and gas spending has slid since the oil market crashed in 2014. But with prices now back above $80 per barrel, Rystad expects upstream oil and gas investments to increase from next year \u2014 particularly in countries where offshore wind is not a government priority. \n \n\n \n \u201cWe\u2019ve already started to see a pick-up in sanction activity [project approvals] and now this is starting to become visible in the investment numbers,\u201d said Espen Erlingsen, Rystad\u2019s head of upstream research. He highlighted Brazil, Guyana and the Middle East as key drivers. Nonetheless, he noted that forecasted investments are still far below pre-2014 levels.\u00a0 \n "

"Offshore wind capex to double to $89 billion by 2030"

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