Our predictions for wind in 2021

New year, new you, and new strains of the same old virus.

If you went back to work on Monday and brightly told your colleagues that you were giving up alcohol for January, then the news that came out during the day may have driven you back to the bottle. New lockdowns, new reports of the more virulent strain of Covid-19 globally, and new economic uncertainty. The only thing that went down quicker than our 2021 hopes was Slack.

But what do the next 12 months hold in store for the wind industry? In our first edition of the year, we like to share ten predictions for the year ahead.

1. Installation figures to get Covid bounce: The pandemic shook every one of us in 2020 and the recent mutations in Covid-19 show us how difficult it will be to get on top of the virus. Economic recovery will be slow. Even so, we expect 2021 to be a record year for wind installations as projects delayed in 2020 are built. Wind will stay resilient this year.
2. Biden injects new enthusiasm in US wind: US wind companies received a final Trump era boost in December as the production tax credit was extended again, and President Biden’s green ambitions will help inject new enthusiasm in the sector. That doesn’t mean it’ll be easy. He’ll face fierce opposition to his plans from Republicans, and some Democrats when he makes compromises. But he will help unlock more investment in wind, including the offshore sector.
3. No more offshore turbines in US waters in 2021: There was a US offshore wind farm completed in 2020, but Dominion Energy’s 12MW Coastal Virginia pilot is small so tends to pass unnoticed. We don’t expect to a repeat in 2021. We are confident that US offshore wind is heading the right way. We will see progress, but firms will be prevented from putting steel in the water as BOEM keeps the industry waiting.
4. European eyes turn to UK round four auction: Brexit might have made the UK’s relationship with Europe somewhat tricky in recent years. Even so, the eyes of the offshore wind industry will be on the prices achieved in the UK’s round four Contracts for Difference auction in November. If this goes ahead then we expect another record low offshore wind strike price – as well as some debate on negative pricing – and clarity over the commercial maturity of floating wind.
5. Offshore emerges in southeast Asia and Scandinavia: New offshore wind markets are opening globally, and we expect great progress in Japan, Korea and Vietnam in 2021. Growing hostility to onshore wind in Norway will push it offshore, alongside Sweden and Denmark. Finally, we expect to see Poland taking off after previous false starts.
6. OEMs eye buyouts to shore up development pipelines: Moves by Chinese manufacturers into offshore wind will pose new threats to western rivals such as Vestas, Siemens Gamesa and GE Renewable Energy. We could see an eye-popping tie-up between an Asian and European OEM! In response, more OEMs will acquire development platforms to help shore up order pipelines, while also doing M&A transactions that help them streamline their supply chains.
7. European oil majors grab headlines with offshore inroads: Oil giants BP, Eni, Shell and Total all set out energy transition plans in 2020 as Covid-19 hit oil prices, and we expect to see them all in the mix to pick up offshore wind assets and specialist offshore developers in 2021. They aren’t going to oust the experienced offshore wind specialists just yet, but they do have the financial firepower to have a major impact.
8. EU green recovery talk cools as attention turns to permits: The EU made some huge commitments to a green recovery in 2020, but it isn’t enough to address slow growth in European onshore wind caused by sluggish permitting processes. We expect the EU to come under greater pressure from the wind industry on the issue in 2021, though its power to fix the issue is limited. This will remain a huge bone of contention.
9. Germany emerges as a PPA hotspot: Renewable energy power purchase agreements of 2.5GW were signed in Spain in 2020 according to stats from Pexapark, but limited demand means that is unlikely to continue in 2021 due to demand constraints. Rather, we expect Germany to emerge as Europe’s most exciting PPA market in 2021 due to its large industrial base and demand for green energy.
10. Companies shout about flexibility post-Covid: Covid-19 has shaken the energy market, but its impact on corporate culture could be more far-reaching. We expect to see more firms shouting about flexible working and hiring practices in the year ahead, and more focus on making wind more inclusive. Even so, we’re convinced that people will want to meet up in offices and at face-to-face events as soon as is safely possible.

What do you think? We’d love to hear your views. We’ll look again at these at the end of 2021 so we can see what we got right and wrong. In the meantime, we’d like to wish you all the best for a happy and healthy 2021. Stay safe.