Research from The Renewables Consulting Group (RCG) has found Brazil has leapt into first place in the global offshore wind rankings, with more than 97 GW of generating capacity in development
As highlighted by OWJ, in early 2022, the Brazilian Government published a decree setting out procedures for ‘assignment of use’ of areas for offshore windfarms. Brazilian state energy company Petrobras recently confirmed it is working with Equinor on the feasibility of an offshore windfarm in the Campos Basin, and Shell has confirmed it is seeking environmental permits to develop six projects with a combined capacity of 17 GW. Several other developers are also planning projects in the South American country.
RCG’s research found that worldwide, more than 200 GW of new offshore wind projects were announced in established markets in 2021 – such as the UK and Netherlands – and new markets – such as Italy and Australia.
According to RCG’s 2021 Global Offshore Wind Annual Market Report, the UK, hitherto acknowledged as the world’s leading offshore wind market, has 10.5 GW operational and 9.8 GW secured, but now ranks second – behind Brazil, with 83.6 GW in total.
Vietnam, with 65.6 GW in development, continues to develop a massive pipeline of projects and, ranking fourth is China, which installed a record-breaking near 8 GW of capacity in 2021 and surpassed the UK to become the largest operational offshore wind market.
China’s growth through 2020 and 2021 is, in part, driven by the expiry of the feed-in tariff at the end of 2021. Taiwan rounds out the top five with a total of 51.6 GW.
Notably, Australia (#10), Italy (#15) and Finland (#16) are new entrants among the world leaders and signify the growing popularity of offshore wind as an option to support the transition to a low-carbon economy.
“The predominant theme in 2021, however, was leasing activity – particularly across Europe,” said RCG. “Scotland allocated almost 25 GW of capacity in the ScotWind process, its first offshore leasing round in a decade.
“The first contract for differences (CfD) round for offshore wind projects took place in Poland, with 5.9 GW of capacity securing a route to market.
“The first new auction for projects under Germany’s offshore wind act also occurred and the first commercial-scale floating wind project auction in France was launched.”
RCG noted that many more auction firsts are to be expected in the coming years, as the groundwork was laid for future site allocations in Spain, Greece, Italy, Norway, Ireland and Lithuania.
Allocation activity was not limited to Europe, however. In the Asia Pacific region, Japan’s first offshore wind auctions took place, securing a route to market for 1.7 GW of capacity.
Rules were refined for the long-awaited Round 3 auctions in Taiwan, clarifying local content requirements and available development areas.
Further south still, the Australian government detailed the permitting process required for projects to obtain seabed exclusivity throughout the development lifecycle of an offshore windfarm.
In the US, the Bureau of Ocean Energy Management announced it would hold up to seven new offshore wind lease sales by 2025 in the New York Bight, off the coasts of the Carolinas, California and Oregon, as well as in the Central Atlantic, Gulf of Mexico and the Gulf of Maine.
The lease auction for the New York Bight area concluded in early 2022 with six areas totalling more than 488,000 acres. At US$4.37Bn in bid revenue, the lease auction results were the highest grossing competitive offshore energy lease sale in history, including oil and gas lease sales.
Also in 2022, Taiwan is launching its third auction round for zonal development, with up to 3 GW of capacity. The upcoming tenders are expected to be highly competitive due to the fact there is a far larger amount of capacity in development than will be awarded subsidies.
“New project leasing has been underpinned – and in some cases driven – by an incredible expansion in the global development portfolio,” said RCG. “Markets such as Brazil, Italy, Spain and Australia have been pushed to draft and ready offshore wind leasing and development frameworks in response to proposals for tens of projects competing for seabed areas and grid connection points.
“Other markets, such as Colombia and the Philippines, have recognised the need for more formal development processes earlier in the respective market maturation, issuing offshore wind frameworks after a smaller number of project announcements.”
RCG partner and global practice lead Andrew Cole said, “The findings contained in this year’s Offshore Wind Global Market Report clearly demonstrate the importance of offshore wind on a global scale.
“Several leasing opportunities have culminated in developers securing routes-to-market – bolstering marketplace confidence among governments, institutions, investors and developers. With offshore wind continuing to emerge in new markets, it is clear many decision-makers envision offshore wind as the key fulcrum in their low-carbon energy ambitions.”
The Offshore Wind Journal Conference will be held 14 June 2022. Details and tickets can be found here
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