Nearly 30 GW of new wind power capacity auctioned in H2 2020, a clear signal that growth is back on-track
Despite the economic and supply chain impacts felt across the world in 2020 due to COVID-19, the global wind energy industry has continued to power ahead and reach new records. According to new analysis by GWEC Market Intelligence in its latest Q4 2020 Wind Energy Auction Update, nearly 30 GW of new wind power capacity was awarded globally through auctions in the second half of 2020, which is a slight increase compared to the 28 GW awarded during H2 2019. This surge in new auctioned capacity is a clear signal that the industry is back on track and committed to building up the global pipeline of wind power projects.
While the first half of 2020 saw auctions being postponed or cancelled due COVID-19 restrictions, the sector bounced back with vigour in the second half of the year as key mature and emerging wind markets began overcoming the impacts of COVID-19. Overall, nearly 35 GW of new wind power capacity was auctioned globally in 2020. Although this is a 26.5 per cent decrease compared to the previous year, 2020 was still the second-highest year on record for auctioned wind capacity.
“Although there were initial concerns from the industry that the COVID-19 pandemic would severely impact the pipeline of wind power projects across the world, the sector’s impressive comeback in Q3 and Q4 2020 has shown that wind power has emerged from the crisis stronger than ever, with 2021 now expected to be a record year for new auctioned capacity” said Feng Zhao, Head of Strategy and Market Intelligence at GWEC.
This influx of auctioned capacity in H2 2020 was led by the world’s largest wind market – China. Although no capacity was awarded in China during the first half of the year, the market recovered formidably beginning in Q3 2020, awarding nearly 12 GW of new wind capacity through auctions. This momentum continued into Q4 2020, with 11 GW of new wind power projects approved in the last two months of the year alone. In total, China accounted for 67 per cent of the global wind power capacity auctioned and awarded in 2020, with subsidy-free onshore wind projects accounting for 96 per cent of the approved capacity in China.
In addition to the remarkable growth in China, there were eight other countries which awarded new wind power capacity in H2 2020, including: India (2.2 GW), Germany (1.5 GW), Poland (900 MW), Netherlands (759 MW) Ireland (479 MW), Greece (472 MW), France (258 MW), and Ecuador (110 MW). Other countries such as Brazil, Chile and the US, which either cancelled or postponed their auctions in 2020 due to the crisis, have now rescheduled them to take place in 2021, which will drive the record auction levels.
“It is really encouraging to see such impressive growth of wind power even in the face of the crisis, and the success of the auctions in the last half of 2020 is a strong indication that governments and investors alike see wind as a key sector to power economic recovery and a fruitful long-term investment. We now need to take advantage of this momentum and put in place the necessary regulatory frameworks to ramp up auctions and further accelerate wind power growth across the world”.
“In order to have a chance of achieving the decarbonisation targets set out in the Paris Agreement, we need to be installing around 180 GW of new wind capacity every year between now and 2050. This means we are still only scratching the surface of the annual installation levels we need to achieve net zero, and must continue building up the project pipeline through effective financing mechanisms such as auctions”, added Zhao.
The full Q4 2020 Wind Energy Auction Update, which includes both analysis and a full database of global wind auctioned capacity, is available exclusively on GWEC’s Members Area. If you are not yet a GWEC Member or subscriber of GWEC Market Intelligence, please contact Raveen Singh at [email protected] and Marina Prado Romera at [email protected] to find out more on how you can access GWEC Market Intelligence products.