The global wind power sector has reported a substantial 29 gigawatt (GW) drop in the fourth quarter of 2023, Wood Mackenzie said. This adjustment indicates a dip in the cumulative installed capacity, now expected to reach 2.35 terawatts (TW) by the end of 2032.
The revised figures, outlined in the ‘Global wind power market outlook update: Q4 2023,’ reveal a less than 2 percent change in expected capacity quarter-on-quarter (Q-o-Q). This adjustment primarily mirrors dynamics in influential markets like the US and China.
“Long-term market fundamentals remain strong despite near-term challenges in project execution in China and offshore market maturation in the US. Markets will evolve, and the findings from the report reflect some of those nuances,” Luke Lewandowski, Vice President of Global Renewables Research at Wood Mackenzie, said.
Key insights from the report show that 82 percent of the global downgrade Q-o-Q emanated from reductions in the Chinese and US markets.
US Market Challenges
The US market experienced setbacks with several canceled power purchase agreements (PPAs), contributing to a substantial 10.9 GW downgrade in the global offshore outlook from 2023 to 2032. Supply chain bottlenecks and permitting delays are anticipated to push nearly 8 GW of offshore wind projects in the US beyond the 2032 outlook, impacting the government’s 30 GW target for 2030.
Economic and policy uncertainty in the US led to a 2 GW cut in the near-term 10-year outlook for the market. Lewandowski noted, “Continued economic and policy uncertainty, including pending guidance from the US Treasury, caused onshore and repowering development timelines to shift, prolonging the 2023 slowdown through 2024.”
Challenges in the Chinese Market
China faced its own challenges, with a 12 GW cut in the forecast due to tightening permitting requirements, project cancellations, idle classifications, and slow project execution rates. However, the report suggests that China’s onshore wind outlook from 2026 to 2032 remains unchanged Q-o-Q.
The near-term outlook for China is expected to be sluggish, and this is reflected in the outlook. However, China’s onshore wind outlook from 2026 to 2032 remains unchanged Q-o-Q.
Positive Momentum in the Middle East
Amidst these global shifts, the Middle East market saw a marginal upgrade of 103 MW, signifying a 0.5 percent increase Q-o-Q over the 10-year outlook. Notably, the UAE’s Masdar accelerated its 103 MW Wind Program cluster inauguration before COP28, elevating the near-term outlook by 206 percent, significantly contributing to the country’s expected capacity by 2032.