The report forecasts that the growth in the sector will be mainly supported by reduced costs for wind generation, financial incentives by many governments and increasing global environmental concerns.
However, GlobalData analyst covering power Swati Gupta said that the expiration of the Production Tax Credits (PTC) in the US will affect global wind turbine installations in 2020 and market value in that year.
Gupta added: “The PTC for wind energy, which pays $23 per megawatt hour ($0.023 per kilowatt hour), will remain until 2016, followed by incremental reductions in value for the years up to January 2020.
“The projects which start construction in 2017 will get 80% of the credit, those that qualify in 2018 will get 60%, and those in 2019 will get 40%.
“The PTC for wind facilities will be phased out completely if the construction starts after December 31, 2019.
“Thus, the wind power market is expected to see a huge rush of capacity additions during 2016–2019 to take the benefits of tax credit extensions before they expire.”
The major challenge for wind power development is upgrading electricity infrastructure, Gupta said, adding that there is an urgent need to modify the existing grid and its regulations in order to accommodate for specific wind power characteristics.
The report said that the wind energy sector will be dominated by China throughout the period, accounting to 26% of the market in 2020, followed by Germany with 10%.
Image: The global wind turbine market will be supported by the reduced costs for wind generation through 2019. Photo: courtesy of dan/FreeDigitalPhotos.net.
