501

The growing global portfolio of offshore wind energy has reached 261 gigawatts in a clear testimony to the good prospects for offshore wind energy worldwide, according to a new report on the ownership, development and transactions of Wood Mackenzie’s offshore wind assets.

05/07/2019

Periodicodelaenergia.com

Against the backdrop of industry growth and consolidation, the report notes that there are several trends that shape the global landscape for project development and ownership.

To begin with, major European players are pursuing higher yields by landing in emerging markets, defined as those that do not have a commercial-scale offshore wind project in place. Secondly, the group of offshore wind investors is expanding and diversifying. Finally, the new report highlights the increasing alliances between offshore companies and the growing importance of consortia in tenders.

Beyond Europe

Ambitious European companies are looking to emerging markets for partnerships and acquisitions to position them for future growth. As a result, there has been an increase in offshore asset transactions in 2018. Of the 19.5 gigawatts of projects that changed hands last year, 60% came from emerging markets such as the US, Taiwan, Poland and Ireland.

Emerging markets with mature regulatory frameworks are the most attractive, although activity may start long before activity is effectively regulated.

Offshore wind developers are demonstrating their willingness to invest a significant amount of money to enter new markets, both through the acquisition of projects and companies, such as Ørsted’s acquisition of US Deepwater Wind.

China remains largely aloof from the increasingly globalized nature of the offshore wind market. While European players dominate the global industry, only one European company has secured a portfolio in China, where state-owned companies dominate the country’s huge 84 gigawatt portfolio.

The size of the Chinese market is such that three of the world’s five largest offshore wind development portfolios are now controlled by Chinese companies.

As emerging markets open up to investment, the group of offshore wind investors is diversifying. Institutional investors, Asian conglomerates and large oil and gas companies are increasingly turning to offshore assets as they gain a better understanding of the risks of their construction and development.

This trend is also evident in recent leasing auctions in the US, where Shell and Equinor have secured capacity in two of the last three auctions.

Wood Mackenzie’s report also draws attention as a trend to observe rising bids and the related growth of alliances and bidding consortia. As more markets shift to competitive bidding and auction schemes, bidding consortia are increasingly common. It is expected that almost 90% of companies participating in bidding in 2019 will participate through consortia.

In addition, developers are increasingly using alliances to enter or strengthen their position in new markets. In this sense, Woodmac’s report highlights that in 2018 alone, 15 alliances were formed.