Asia’s offshore wind to reach over 100GW in 2031: report

Asian markets with long coastlines are expected to capitalise on offshore wind (Photo: Bangui Wind Farm by Jhay-Ann Santos)

ASIA PACIFIC

The attractiveness of offshore wind will drive the stronger growth of the market in Asia as it is projected to reach 108.8 gigawatts (GW) in 2031, Fitch Solutions reported.

This is a significant increase from the 27.3GW offshore wind capacity recorded at the end of 2021, reflecting an annual average growth rate of 15.3% between 2021 and 2031.

“This view is strongly supported by Asia’s strong offshore wind power project pipeline, currently standing at about 127.9GW in our Key Projects Database,” Fitch noted in a report.

“We expect strong upside risks to this forecast as more offshore wind power projects come online over the decade.”

Fitch added that its projection is supported by markets, such as Australia and the Philippines, that have started looking into the possibility of developing offshore wind power through exploratory roadmaps and feasibility studies.

The region presents opportunities for the development of offshore wind power, considering the large number of coastal cities in Asia as well as the high and consistent wind loads off the coasts.

“We expect Asian markets with long coastlines and supportive renewable energy policies to capitalise on offshore wind strengthening their project pipeline,” the report also read.

At present, Mainland China is the leading market in the region in terms of offshore wind. The market is expected to account for 87% of the total offshore wind power capacity growth in Asia projected between 2021 and 2030.

The report noted that this growth is supported by the abundance of favourable

We expect strong upside risks to this forecast as more offshore wind power projects come online

locations in China, coupled with the increasing cost competitiveness of wind power technologies in the market. China particularly sees its offshore wind power capacity grow from 26.4GW in end-2021 to 96.8GW in 2031, at an annual average growth of 14.3%.

Emerging markets

Australia and India are the markets to watch in terms of the emergence of offshore wind over the next 10 years due to the developments in government policies that will encourage the growth of the energy sector.

Fitch noted in the report that it sees potential for the emergence of offshore wind in Australia despite having no deployments after the government designated its first zone for offshore wind power developments in September.

“This move gives developers more clarity to explore offshore wind in the market, with the permit allowing them to progress through project planning and consultation stages,” it said.

However, Fitch said in the report that it will still hold forecasting Australia’s offshore wind market as any project construction have yet to start.

India, meanwhile, has been studying offshore wind since 2014 following the 100MW demonstration of a project in Gujarat which is still in the planning stage.

Fitch cited the plan of the Ministry of New and Renewable Energy to hold bids for two 1GW offshore wind projects in Gujarat and Tamil Nadu.

“This will mark a significant development in India’s offshore wind sector if launched and well-received, as India has yet to develop any offshore wind. We have yet to forecast any offshore wind for India as we remain apprehensive given its poor track record of commissioning power projects on time,” the Fitch report said.

VENA ENERGY’S HYBRID SOLAR, BATTERY PROJECT IN AUSTRALIA HITS FINANCIAL CLOSE

Renewable energy firm Vena Energy has reached a financial close for its hybrid solar and battery energy storage system (BESS) project in South Australia, which is expected to start operations in 2023.

In a statement, Vena Energy said the Tailem Bend 2 Hybrid Project would have a 128.5-megawatt (MW) capacity once completed, 87MW will be from the solar projects and 41.5MW will be the BESS.

It is the company’s first operational system to combine solar and battery, following the first stage of the Tailem Bend Solar Project which started operations in 2019.

“Vena Energy’s mission is to accelerate the energy transition across the Asia-Pacific region, and the Tailem Bend BESS is an example of this shift as it will provide both generation and storage for renewable energy to the South Australian network as part of its plans to achieve net-zero by 2030,” said Owen Sela, head of Vena Energy Australia.

Sela added that the company has around five gigawatts of renewable energy projects in the pipeline in Australia.

Tailem Bend 2 Hybrid Project is Vena Energy’s third financing arrangement in Australia. It is backed by the DBS as the joint-green structuring bank, technical coordinator, facility agent and project account bank; ING as the joint-green structuring bank and financial model coordinator; and Siemens Financial Services through the Siemens Bank.

The solar farm can supply electricity to around 35,000 homes annually and reduce over 207,000 tonnes of carbon dioxide greenhouse gas emissions or equal to planting more than 3.4 million trees, according to Vena Energy.

Solar power generated from the project is under a purchase agreement signed by ZEN Energy to support its South Australian customers.

The company said the battery energy storage system would provide energy storage and ancillary services to support the South Australian grid’s reliability.