April 9 (Bloomberg) -- Wind-power installations will climb to a record this year, driven by resurgent U.S. demand and growth in developing nations from Brazil to China, the Global Wind Energy Council predicted.
Worldwide installations will probably surge 34 percent to 47.3 gigawatts in 2014, the Brussels-based trade group said today in an e-mailed report. That follows a drop by more than a fifth to 35.3 gigawatts last year that was fueled by crashing U.S. demand after a tax credit to the industry expired.
Developing countries outside the 34-member Organization for Economic Co-operation and Development will spur new wind power demand for the next five years, with markets in Asia, Latin America and Africa providing “easy growth,” GWEC said. Wind is already competitive with traditional generators in countries including Brazil, South Africa and Turkey, it said.
“For 2014 and beyond we can look for most of the growth in the global market to come from both new and established markets outside the OECD,” GWEC Secretary-General Steve Sawyer and Chairman Klaus Rave said in the report’s foreword. “It’s much easier for wind to get strong market share in a dynamic and growing economy with significant demand growth.”
The U.S. will also see a rebound, because of the structuring of the industry’s tax incentives, according to the council. The so-called production tax credit, or PTC, expired at the end of 2012 before being renewed a day later when developers had already rushed wind farms to completion, leaving a dearth of new projects and causing last year’s decline.
While the credit expired again at the end of 2013, new rules mean that any projects that began construction last year can still benefit if they are completed by the end of 2015.
“Partly because of the precipitous drop in the U.S. in 2013, 2014 promises to be a record year,” Sawyer and Rave wrote. “The U.S. had an all-time high of more than 12,000 megawatts under construction in December of 2013, and the nature of last year’s PTC extension means that not only 2014 but 2015 will be solid and productive years.”
Last year’s drop was the first in more than 20 years for the global wind industry, according to GWEC. After this year, the market will stabilize to “more-normal” annual growth levels, it said. The group forecasts global installations for the years 2015 through 2018 at 51 gigawatts, 55.7 gigawatts, 60.2 gigawatts and 64 gigawatts respectively.
China’s target of reaching 200 gigawatts of installed capacity by the end of 2020, up from 91 gigawatts now, implies an annual market of 15.5 gigawatts a year, a goal they’re “likely to exceed,” GWEC said.
The South African market is “finally taking off,” and Brazil this year will probably move up to third or fourth in the annual rankings, the group said.
China had the biggest market in 2013, with 16,100 megawatts of installations, followed by Germany on 3,238 megawatts, the U.K. on 1,883 megawatts, India on 1,729 megawatts and Canada on 1,599 megawatts, according to GWEC. the U.S. market plunged to 1,084 megawatts from more than 12,000 megawatts in 2012, it said.
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