Global Turbine Supply Chain Primed for Growth

The global value of the wind turbine supply chain sector could reach US$540 billion over the next 10 years, according to the latest research from consultants Wood Mackenzie.

Growing demand for wind power is expected to drive breakbulk growth around the globe as pressure to lower the cost of electricity is accelerating technology developments.

“We expect the global market share among the top five-turbine OEMs (original equipment manufacturers) to rise to more than 73 percent by 2027, compared to just 54 percent in 2016. It is therefore imperative that component suppliers secure strategic relationships with these winning OEM to solidify their own future success,” said Shashi Barla, senior analyst at Wood Mackenzie Power & Renewables.

 

Next-generation Turbines

Overall the firm predicts a wider proliferation of next-generation 4.X/5.X/6.XMW turbines utilizing larger components to generate more power turbine. As a result, the firm forecasts a decline in turbines deployed from more than 20,000 turbines in 2018 to slightly more than 16,000 by 2027.

The firm further warns that growing disparity between megawatt growth and units deployed will impact component suppliers as price pressure percolates down the supply chain.

“Global wind annual installations are expected to grow 40 percent in the next decade, from 53 gigawatts in 2018 to over 75 gigawatts by 2027,” Barla added.

 

Offshore Investment Boost

One key area for breakbulk growth is expected to be demand for transport of longer blade lengths for next-generation turbines. Carbon fiber utilization for structural blade support is also expected to increase market share, from 25 percent in 2018 to about 57 percent by 2027, due to support for light-weighting and other advanced properties.

“Offshore growth in Asian markets will facilitate expansion opportunities for independent blade suppliers, as western markets are primarily served by turbine OEMs in-house capacity,” Barla explained.

India was also highlighted as a potential growth spot for the sector as the trade war between the U.S. and China intensifies and turbine OEMs and suppliers “flood the market with investments in new facilities and capacity expansion.”

Photo: Offshore wind farm. Credit: Wikimedia