Market Forecast for 2012-2016
GWEC expects the industry to continue to grow during the coming five years, but it will not be easy. It will be especially tough for manufacturers, with chronic oversupply of turbines adding to existing downward price pressure from general economic conditions to cut margins dramatically.
Uncertainty about the future of carbon markets is also a factor. There is little prospect of a revitalisation of the CDM markets in the next five years, other than a modest new source of demand from Australia.
The European ETS is flooded with credits from too generous allocations in the earlier periods, and there is no certainty that it will be fixed soon. However, new potential markets in South Korea and China may start to have an impact by the end of this period.
The biggest uncertainty is the future of the United States Production Tax Credit, and its impact on the world’s second largest wind market. Despite a strong 2012, there is going to be a drop in 2013. How big a drop, how long it will last, and what effect it will have on both project and manufacturing investment, is the largest variable affecting the overall market size in the next few years.
For the second year running, the majority of new installations were outside of the OECD, and this trend will no doubt continue.
While the Chinese market has now stabilised for a while, the Indian market is growing strongly as are Brazil and Mexico.
Overall, we expect to see average annual market growth rates of about 8% for the next five years, but with a strong 2012 and a substantial dip in 2013. We see total installations for the 2012-1016 period of about 255 GW, and cumulative market growth averaging just under 16%. This is well below the 28% average for the last 15 years, but substantial growth in difficult times.
Overall, we see total capacity ending up at just under 500 GW by the end of 2016, with an annual market in that year of just under 60 GW.