Offshore wind spending is closing the gap on oil and gas investments and is expected to surpass them in several key markets by 2030, a new report from energy intelligence firm Rystad suggests.
According to Rystad, whereas offshore oil and gas spending is predicted to exceed $140bn by 2030, the offshore wind sector is expected to achieve a market size of $87bn during the same period – a 70% rise from the market value of $50bn in 2021.
Countries and regions that prioritise offshore wind can expect a steady drop in offshore fossil fuel investment, as well as the eventual crossover. China and the UK, the two largest offshore wind nations in terms of operating capacity, have already crossed this threshold in 2017 and 2020, respectively. With 119 GW of capacity, Europe is predicted to be the world’s largest offshore wind area by 2030. The continental crossing point is projected in 2026, while offshore wind investments in Denmark alone are likely to outnumber oil and gas investments as early as next year.
Rystad believes the offshore wind industry in the US is likely to have the strongest rise in investment, albeit from extremely low levels in 2020. At the same time, offshore wind activity is increasing in China, although investments will fall towards 2030 as feed-in-tariffs phase-out beginning in 2022. Nonetheless, considerable continuous investment is predicted to make China the world’s largest offshore wind market by 2030, with 58 GW of installed capacity.
“To remain relevant in a changing market, offshore service companies will need to monitor this trend closely as they draft long-term strategies that position them for a smooth transition into offshore wind, enabling them to take advantage of what promises to be a major growth industry,” said Alexander Dobrowen Fløtre, offshore wind expert and vice president at Rystad Energy.