Although the North American wind energy industry lags in certain areas behind Europe and Asia, falling costs and larger, more efficient turbines are giving rise to a sense of cautious optimism.
Home to the second-largest wind market in the world, the United States saw a total of 5,784 megawatts (MW) of wind capacity installed in 2010. Although 2011 was another difficult year for the industry, the region now accounts for more than 22 percent of the world’s total installed wind capacity.
According to a recent report from clean tech market intelligence firm Pike Research, installations in the region will pass 125 gigawatts (GW) by 2017—more than doubling from 2011 to 2017—with onshore installations accounting for more than 97 percent of that total. Overall, Pike forecasts that approximately $145 billion will be invested in onshore and offshore wind-energy installations between 2011 and 2017 in North America.
“Recovery is gradually taking hold across the wind industry in North America, and many key industry players are optimistic about the North American market as turbine costs continue to drop dramatically,” said Dexter Gauntlett, Pike research analyst. “However, the uncertainty surrounding the extension of the production tax credit in the U.S. continues to prevent the country from reaching its full potential. The United States produces enough electricity from wind energy to supply 10 million homes, but there is still plenty of room to grow. Wind still accounts for only 2.3 percent of total electricity generation in the United States, compared with around 20 percent of total generation in some countries.”
One factor powering the wind industry is consolidation. Over the past three years, numerous high-level mergers and acquisitions have resulted in more dynamic, vertically integrated companies. While the majority are pure technology players, the increasing trend is for manufacturers to acquire wind farm development companies (or “downstream integrate”) as a strategy for ensuring the use of their turbines.
Pike Research’s analysis indicates that wind-energy installation costs in the United States will total more than $125 billion between 2011 and 2017, capturing 15 percent of the global market during that period. Canada will reach 15 GW of total wind capacity by 2017, with more than 400 MW of that amount derived from offshore installations. In Canada, installation costs will total $19.3 billion between 2011 and 2017. In the midst of this market transition, turbine manufacturer market shares are fluid, as well. In 2010, Chinese wind turbine manufacturer Sinovel overtook GE Wind Energy to become the second-largest wind turbine supplier worldwide and came in at less than 1 percent (350 MW) behind industry leader Vestas.
Pike Research’s report, “Wind Energy Outlook for North America,” provides an in-depth analysis of North American opportunities in the onshore and offshore wind-power markets. It also examines key challenges facing the industry. An executive summary of the report is available for free download at www.pikeresearch.com.