The EU Wind Market

The world�s wind energy resource is estimated to be around 53,000 TWh per year.  More than one-fourth of these resources are found in North America while Africa and Eastern Europe (including the former Soviet Union), each account for one-fifth of these resources.  Western Europe on the other hand accounts for only 9% (or 4,800 TWh) of these global resources; but its estimated technical potential for wind power is lower than the available resources.  Onshore wind power technical potential is placed at 600 TWh per year while the offshore potential is estimated to be around 300 TWh per year.

Western Europe however leads globally in terms of wind power development, and is the leading market for wind power.  In 2004, 71% (5886 MW) of the world�s capacity additions were in Europe. The region�s total installed wind power capacity at the beginning of 2005 reached 34.6 GW, representing 73% of the global capacity.

An interesting development in Spain is the passage of new improved legislation supporting wind power development.  The country has become the new leader with respect to new capacity additions, dislodging Germany from the number one position in 2004 (Table 1).  Spain recorded 2061 MW new installations in 2004 against Germany�s 2020 MW.  Germany however remains the global leader in terms of total installed capacity with more than one-third of the world�s total installed capacity at the end of 2004.

Capacity additions in Denmark � the world�s pioneer in wind power � have fallen to only 7 MW in 2004.  This is mainly due to the government�s decision to discontinue the feed-in tariff scheme, which was the driving force behind the wind power development in the country.  Globally, Denmark occupies the fourth place in terms of total wind power capacity with 3117 MW in 2004.

Markets with more than 100 MW wind power capacities have also emerged in Europe.  In 2004, medium-sized markets with growth more than 50% included Norway, Ireland, Portugal and France.

Other important markets of wind power in the world are the US, Asia and Australia. The US is the third largest market with a total installed capacity of 6740 MW in 2004.  Capacity additions in 2004 slowed down to only 370 MW due to the delay in the extension of the production tax credit scheme.

India, Japan and China ranks 5th, 8th and 10th in the global market, respectively with total installed capacity of 2985 MW, 896 MW and 764 MW respectively in 2004.  India�s new installation of 875 MW in 2004 was also the world�s third largest. Japan�s capacity addition in 2004 is slightly higher than the US at 390 MW, while China commissioned 197 MW wind power capacity during the same period.  Australia ranks 17th with the total installed capacity of 379 MW. Around one-half of the capacity was commissioned in 2004.

Table 1. EU Wind Power Installed Capacity and New Installation in 2004

Source: www.wwindea.org

The medium term prospect for wind power in Europe is robust, driven by the current Renewable Energy Directive of the European Union with strong policy support from individual member countries.  The Directive aims to increase the renewable energy share in the total electricity consumption to 22% in 2010.  The European Commission projects that wind power in Europe could reach 69,900 MW by 2010.

Sources: www.ewea.org; www.wwindea.org; Wind Force 12 (June 2005)

Offshore Sites: The New Frontier

Wind industry�s new frontier are the offshore sites.  These sites offer high and more predictable wind speeds averaging more than 8 meters per second at a height of 60 meters.  Offshore sites in Northern Europe are estimated to deliver 20-40% more energy than good shoreline sites.  Also, offshore sites have reduced landscape impacts.  European countries with large offshore wind potential are Denmark, the UK, Sweden, the Netherlands and Ireland.

The cost of generating power in offshore sites is however high since offshore wind farms require strong foundations, longer power transmission cables, special equipment and marine vessels to undertake construction and maintenance works during favorable weather conditions.  As the demand increases, economies of scale could nonetheless be achieved causing the costs to fall down.

Denmark is currently the leading European country in terms of offshore wind power development.  Two offshore wind farms were constructed in 2002 (Horns Rev � 60 MW) and 2003 (Nysted � 165.6 MW).  Two new projects of 200 MW each are being developed.

The United Kingdom on the other hand is challenging the Danish leadership.  The country�s first allocation round for exploration rights had generated proposals with more than 1,000 MW of capacity.  At present, two wind farms have been already built (60 MW in North Hoyle and 60 MW in Scroby Sands).  Two new sites are being developed � Kentish Flats and Barrow (both 90 MW) � with construction to begin this year.  The second allocation round in 2003 had resulted in 15 proposals with a total capacity of 7,200 MW.

Another country with ambitious offshore plans is Germany.  Construction permits were granted to 6 projects in the North and Baltic Seas with total capacity of up to 1,200 MW.  The German government aims to generate offshore wind farms with total capacity of 25,000 MW during the period 2025 � 2030.

Other European countries with offshore plans include the Netherlands (the construction of 2 projects 120 MW and 99 MW to begin soon, Belgium (the construction of 1 300 MW to commence soon), Ireland (the Arklow Bank wind farm pilot project with total capacity of 520 MW was completed in 2003), and Sweden (approval was granted to 48 wind turbines to be installed in the �resund Strait.

Source: Wind Force 12 (June 2005)