China Poised To Overtake U.S. As World’s Leading Wind Producer By 2016: GlobalData

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During this year's State of the Union address, President Obama cited the U.S. wind market as the world leader. The remark caused confusion, as many thought China was the undisputed wind leader. According to GlobalData, the metrics used to determine the world leader go a long way to determine superiority.

‘The U.S. generates the largest amount of wind energy compared to any other nation – that is true,’ says Pranav Srivastava, GlobalData's analyst covering power. However, he says, China has the world's largest wind power by installed capacity. The country plans to grow further and surpass U.S. wind power generation by 2016.

‘China produced about 169 TWh of electricity in 2014 while the U.S. was slightly more than 175 TWh, says Srivastava. Despite China having a larger wind installed capacity, its comparatively lower levels of wind power generation can be attributed to slower wind speeds and the country's inadequate grid infrastructure covering the rapid increase in the number of wind turbines in remote areas.

‘For a fairer assessment, we can use installed capacity to estimate the extensiveness of wind power development in a country. China's cumulative wind power installed capacity increased from 402 MW in 2001 to 110 GW in 2014, at a compound annual growth rate of 50.5 percent,’ he notes. In terms of cumulative installed capacity in 2014, China is clearly ahead, as U.S. capacity currently stands at approximately 66 GW, maintains Srivastava.

‘Furthermore, in terms of annual installations, the Chinese wind industry has proven to be more stable than the U.S., as the latter's annual installations rely heavily upon government incentives, which are often under speculation. China added about 18 GW of new installed wind capacity in 2014, whereas the U.S. only added around 4.9 GW, according to GlobalData.

‘In 2013, the U.S. wind industry witnessed a 92 percent drop in annual installed capacity and around 30,000 job losses due to the expiration of the production tax credit. Although this incentive, which was renewed early in December 2014, sought to benefit wind power generators, it did not have any worthwhile positive impact on the industry in practicality, as it gave investors very little time to meet its eligibility requirements,’ he says. ‘As such, the U.S. wind sector may not be in as healthy a condition as President Obama recently claimed.’

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