Onshore Wind Energy Market – Global Industry Size, Share, Trends, Opportunity, and Forecast Segmented By Application (Peak Power Management, Power Storage, Demand Response, Frequency Response, And System Stability), By End-User (Industrial, Commercial, and Residential), By Grid Connectivity (Off-Grid And On-Grid), By Wind Capacity (High Wind Speed, Medium Wind Speed, And Low Wind Speed), By Region

Market Overview

Global Onshore Wind Energy Market

Key Market Drivers

The global Onshore Wind Energy market has experienced remarkable growth and transformation over the past few decades. Driven by the need for cleaner, sustainable energy sources and a global commitment to reducing greenhouse gas emissions, Onshore Wind Energy has become a prominent player in the world's energy landscape. In this comprehensive analysis, we will delve into the key drivers and trends shaping the global Onshore Wind Energy market, explaining them in detail to provide a thorough understanding of the industry's dynamics.

Climate Change and Environmental Concerns

One of the most critical drivers of the global Onshore Wind Energy market is the urgent need to address climate change and mitigate its effects. The burning of fossil fuels for electricity generation and transportation is a significant contributor to greenhouse gas emissions, leading to global warming and environmental degradation. Onshore Wind Energy offers a sustainable alternative by producing electricity without emitting carbon dioxide (CO2) or other harmful pollutants. As governments worldwide commit to reducing emissions under international agreements like the Paris Agreement, wind energy's role in decarbonizing the energy sector becomes increasingly vital. Many countries have established renewable energy targets and policies to transition to cleaner energy sources, reduce dependency on fossil fuels, and combat climate change. These targets often include specific goals for Onshore Wind Energy capacity installation. For example, the European Union has set ambitious targets to achieve a significant share of its energy consumption from renewables, with wind power playing a central role. Such policies create a favorable regulatory environment and incentives for Onshore Wind Energy projects, driving market growth.

Falling Costs and Technological Advancements

Advancements in wind turbine technology and economies of scale have led to a significant reduction in the cost of Onshore Wind Energy production. Larger, more efficient wind turbines can capture more energy from the wind, reducing the levelized cost of electricity (LCOE). As a result, Onshore Wind Energy has become increasingly competitive with conventional fossil fuels. Innovations such as taller towers, longer blades, and advanced control systems have improved efficiency and grid integration. This cost decline has made Onshore Wind Energy an attractive option for both utilities and consumers. Energy security and diversification of energy sources are critical considerations for many nations. Onshore Wind Energy provides an indigenous, domestic source of electricity production, reducing dependence on imported fossil fuels. This enhances energy security by reducing vulnerability to supply disruptions and price fluctuations in the global energy markets. Countries with diverse energy portfolios that include wind power are better equipped to manage energy-related risks. The Onshore Wind Energy industry has a substantial impact on job creation and local economies. The construction, operation, and maintenance of wind farms require a skilled workforce, leading to employment opportunities in both rural and urban areas. Additionally, the Onshore Wind Energy supply chain, including the manufacturing of wind turbines and components, generates economic activity. As a result, governments and regions often view Onshore Wind Energy as a means to stimulate economic growth and reduce unemployment. Corporations are increasingly adopting sustainability goals and environmental, social, and governance (ESG) criteria in their operations. Many large companies are investing in renewable energy projects, including wind farms, to reduce their carbon footprint and meet sustainability targets. These corporate off-take agreements provide stable revenue streams for Onshore Wind Energy developers and drive further investments in the sector. Public awareness of environmental issues and support for renewable energy have grown significantly. Communities often welcome Onshore Wind Energy projects due to their perceived environmental benefits and the potential for local economic development. Public support can facilitate permitting and regulatory approvals for wind farms, making it easier for developers to bring projects to fruition. Integration with other technologies, such as energy storage systems and smart grids, enhances the reliability and flexibility of wind energy. Energy storage allows excess wind power to be stored for later use, reducing the intermittency associated with wind generation. Coupled with advanced grid management systems, Onshore Wind Energy can play a more significant role in supplying stable and reliable electricity.

Offshore Onshore Wind Energy Expansion

Offshore Onshore Wind Energy is gaining momentum worldwide. Offshore wind farms offer the advantage of stronger and more consistent winds, leading to higher energy generation. As technology and experience in offshore wind develop, countries with access to offshore resources are investing heavily in this sector. The expansion of offshore wind contributes to the overall growth of the Onshore Wind Energy market.

Key Market Challenges

Land and Space Constraints & Energy Storage and Grid Integration

One of the fundamental challenges of Onshore Wind Energy is its inherent intermittency and variability. Wind turbines generate electricity when the wind blows, which is not constant. This variability can lead to fluctuations in power output, making it challenging to ensure a stable and reliable energy supply. Grid operators must manage this variability effectively to maintain a balanced and secure electricity grid. To address the intermittency issue, energy storage solutions are crucial for storing excess energy when the wind is strong and releasing it when the wind is calm. While advancements in energy storage technologies have been made, there is still room for improvement in terms of efficiency and cost-effectiveness. Additionally, integrating Onshore Wind Energy into existing electrical grids can be complex and may require substantial grid upgrades and infrastructure investments. Onshore wind farms require significant land areas to accommodate the turbines and associated infrastructure. In densely populated regions, finding suitable land for wind farm development can be challenging. Additionally, land-use conflicts may arise as wind projects compete with agriculture, residential areas, and other land uses. Offshore wind farms have alleviated some of these issues but present their own challenges, including construction and maintenance costs. Onshore Wind Energy projects, both onshore and offshore, can have environmental impacts. Bird and bat collisions with wind turbine blades are a concern, as are potential habitat disruptions. Careful site selection and mitigation measures are necessary to minimize these impacts. Additionally, the production and disposal of wind turbine components have environmental considerations, such as materials sourcing and recycling. The production of wind turbines requires specific rare earth metals and materials, such as neodymium and dysprosium for magnets. Securing a stable supply of these materials can be a challenge due to geopolitical factors, market fluctuations, and concerns about resource depletion. Efforts are ongoing to develop alternative materials and reduce reliance on rare earth elements.

Key Market Trends

One of the most prominent trends in the Onshore Wind Energy market is the rapid expansion of offshore wind projects. Offshore wind farms, located in bodies of water such as oceans and seas, benefit from stronger and more consistent wind patterns compared to onshore locations. As technology advances and developers gain experience, offshore wind capacity has surged, particularly in Europe, the United States, and Asia. Key factors driving this trend include

Higher Energy Yields

Grid Connection

Floating Wind Technology

Technological Advancements and Larger Turbines

Wind turbine technology continues to evolve rapidly, with a focus on increasing efficiency and reducing costs. Key trends in this area include

Larger Turbines

Advanced Materials

Digitalization and Smart Technology

Segmental Insights

Wind Capacity Insight

High wind speed segment dominated the market in 2022. Since there are turbines that run separately and provide electricity of around 2.3 MW, the high wind speed projects are predicted to dominate the market.

Regional Insights

The Europe region has established itself as the leader in the Global Onshore Wind Energy Market with a significant revenue share in 2022

Recent Developments

• In February 2021, Continuum Onshore Wind Energy Ltd, sponsored by Singapore-based Clean Energy Investing Ltd, the indirect wholly-owned subsidiary of a Morgan Stanley fund entity, New Haven Infrastructure Partners, announced its plans to issue its maiden green bond of USD 500-600 million to be listed on the SGX. The proceeds will be used to refinance the project debt at six of its operating entities and to set up wind projects in India. This is expected to aid the growth of the market.
• In February 2021, the Ministry of Infrastructure and Energy stated that it is re-evaluating projects and investment plans in cooperation with the European Bank for Reconstruction and Development. Four wind parks in Albania are about to lose the licenses that they obtained in 2007 and 2008. This is expected to impede the growth of Onshore Wind Energy in the country.
• In 2021, a USD 43 billion deal was signed by the South Korean government. It is expected to be the world's biggest offshore wind power complex as the country seeks to achieve carbon neutrality by 2050. The agreement involves 33 different entities, such as regional governments, the electricity generator KEPCO, and major private firms, including Doosan Heavy Industries & Construction and SK E&S.

Key Market Players

• Siemens Energy
• Vestas Wind Systems
• Siemens Gamesa Renewable Energy
• General Electric (GE) Renewable Energy
• Goldwind
• Envision Energy
• Nordex SE
• Suzlon Energy
• Orsted
• NextEra Energy Resources
• China Guodian Corporation (China Energy)