The global market value for offshore wind turbine and foundation installation vessels will increase more than fivefold, from an estimated $0.56 billion in 2014 to approximately $2.93 billion by 2020, representing an impressive compound annual growth rate (CAGR) of 30%, according to a report from GlobalData.
The report states that increasing installations will be the primary driver of market growth, as annual global offshore wind power capacity is forecast to rise rapidly from 1.78 GW in 2014 to approximately 7.85 GW by 2020.
"Offshore wind projects are more expensive than their onshore counterparts because the structures are larger, the logistics involved in tower installation are more complex, and costs associated with foundations, construction, installation and grid connection are higher," explains Prasad Tanikella, GlobalData's senior analyst covering power.
"Despite the higher project costs, offshore winds are more powerful and consistent, producing higher energy yields," adds Tanikella. "Moreover, high offshore wind power potential and the unavailability of onshore wind power sites are forcing some countries to explore offshore options."
The report says Europe is by far the biggest market for offshore wind power, estimated to account for over 90% of global turbine installation vessel revenue in 2013, and GlobalData expects this market to see substantial future growth.
Despite the many projects currently planned or under construction in Europe, a limited number of offshore-wind-specific installation vessels are currently operating at present, although this number will have increased from just two in 2005 to more than 40 by the end of 2014. Furthermore, new vessels are increasingly making installations more efficient.
"Future vessels will allow developers to shorten installation times with increased vessel crane capacity and additional deck space, enabling them to carry more turbines and reduce the number of trips from the onshore port to the offshore site," says Tanikella. "The new-build vessels are also expected to reduce weather downtime, as their design will allow them to operate in harsher conditions."