2024 likely to see another all-time high in offshore wind capex

In a 9 January 2024 assessment of the renewable energy market, Clarksons Securities said that despite negative news around the industry in 2023, and a challenging interest-rate and cost-inflation environment, offshore wind project capex commitments reached record levels of US$59Bn, representing approximately 19.5 GW of capacity.

“In Europe alone, an estimated US$33Bn was committed, equating to 9.2 GW. That was 33% above the previous record total in 2020,” said Clarksons Securities, noting that firm investment was driven by the sanctioning of a small number of large-scale projects, with an average capex commitment of US$4.1Bn per project.

Clarksons also noted that although FID figures in Europe for 2023 were partly driven by some projects initially expected for 2022 slipping, this is an effect that it does not expect to be replicated to the same extent in 2024 and other markets “should pick up the slack and drive growth in 2024.”

“Driven by high activity in China, offshore wind project investment in Asia is expected to increase in 2024, while development costs are continuing to fall, supported by the use of larger turbines. With increased FID activity also expected in the US market, we deem it is more likely than not that another all-time high for global capex commitments is reached in 2024,” Clarksons Securities’ analysts concluded.