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GSR 2015

73 02 RENEWABLES 2015 GLOBAL STATUS REPORT Worldwide capacity of small-scalei turbines rose 12% in 2013, significantly below the 18% increase in 2012.71 At least 870,000 small-scale turbines, or more than 755 MW, were operating worldwide at the end of 2013 (up from 678 MW at end 2012).72 By one estimate, another 255 MW was added during 2014.73 Applications include defence, rural electrification, water pumping, battery charging, and telecommunications, with small turbines used increasingly to displace diesel in remote locations.74 While most countries have some small-scale turbines in use, the majority of capacity operating at the end of 2013 was in China (305 MW) and the United States (221 MW).75 Other leaders include the United Kingdom (113 MW), Italy (29.1 MW), Germany (21.8 MW), Canada (12.6 MW), and Ukraine (12.5 MW)ii .76 In 2013, the three biggest markets saw a decrease in the number of units installed; in 2014, US and UK markets slowed substantially due to reduced incentives and competition with solar PV, but US momentum is building around new leasing models.77 In general, the market is evolving towards larger turbines, which are easier to finance.78 Small-scale vertical axis turbines are gaining attention but remain a small share of the market.79 Repowering—the replacement of old turbines with fewer, larger, taller, and more-efficient and reliable machines—is a rapidly developing new line of business, particularly in Europe and, to a lesser extent, in Japan.80 During 2014, an estimated 444 MW of old turbines was dismantled in Europe (over 430 MW), Japan (11 MW), and Taiwan (2 MW).81 The largest market was Germany, which dismantled at least 544 turbines with capacity totalling almost 0.4 GW; at least 413 turbines, with capacity of 1,148 MW, were installed in repowering projects.82 There is also a thriving international market for used turbines in several developing and emerging economies.83 Windpowerisplayingamajorroleinpowersupplyinanincreasing number of countries. In the EU, wind’s share of the electricity mix was about 7.5% in 2014, and, at year’s end, capacity in operation was enough to cover more than 10% of electricity consumption in a normal wind year.84 Several EU countries—including Denmark (39.1%), Ireland (19%), Portugal (27%), and Spain (over 20%)— met higher shares of their demand with wind.85 Four German states had enough wind capacity at year’s end to meet over 55% of their electricity needs, and the Australian state of South Australia generated approximately 40% of its electricity from wind.86 In the United States, wind power represented 4.4% of total electricity generation and accounted for more than 12% of generation in nine states.87 Nicaragua, which added 40 MW for a total of 186 MW, generated almost 21% of its electricity with the wind.88 Globally, wind power capacity by the end of 2014 was enough to meet at least 3.1% of total electricity consumption.89 ■■ WIND POWER INDUSTRY After years of running in the red—and the loss of a quarter of businesses across the supply chain due to economic recession and policy uncertainty—most turbine makers pulled back into the black in 2014 and ended the year with fairly full order books.90 In this more streamlined industry, major manufacturers have outsourced extensively to remain profitable and have advanced value-added products and services (including advanced materials, innovative designs for blade extension, after-market service solutions) to further reduce levelised energy costs to compete with fossil energy sources.91 Over the past few years, the capital costs of wind power have declined, primarily through competition as well as through technological advances that have increased capacity factors.92 Onshore wind power is now cost-competitive, or nearly so, on a per kWh basis with new coal- or gas-fired plants, even without compensatory support schemes, in more and more markets (including Australia, Brazil, Chile, Mexico, New Zealand, Turkey, South Africa, much of the EU, and some locations in India and the United States).93 By one estimate, global levelised costs per MWh of onshore wind fell about 15% between 2009 and late 2014.94 After a period of rising costs offshore due to the use of new machines in deeper waters farther from shore, there is growing evidence that costs are coming down.95 Most of the world’s turbine manufacturers are in China, Denmark, France, Germany, India, Japan, Spain, and the United States, and components are supplied from many countries.96 An increasing number of manufacturers is in Brazil, with South Korea also emerging as a producer of wind technology.97 Blade manufacturing, for example, has shifted from Europe to North America, South and East Asia, and, most recently, Latin America to be closer to new markets.98 The world’s top 10 turbine manufacturers captured 68% of the market in 2014 (down from 70% in 2013).99 Vestas (Denmark) retained the top spot, followed by Siemens (Germany), which climbed two steps.100 Goldwind (China) dropped one to third, GE (United States) stepped up from fifth to fourth, doubling its 2013 installations, and Enercon (Germany) fell from third place to fifth.101 Other top manufacturers were Suzlon Group (India), Gamesa (Spain), as well as United Power, Mingyang and Envision (all China).102 (pSee Figure 24.) All companies in the top 10 broke installation records in 2014.103 As the amount of wind output and its share of total generation have increased, so have grid-related challenges in several countries.Challengesincludelackoftransmissioninfrastructure, delays in grid connection, the need to reroute electricity through neighbouring countries, and curtailment where regulations and current management systems make it difficult to integrate large amounts of wind and other variable renewables.104 Curtailment remains the largest challenge facing China’s industry, where it is hurting profit margins.105 Overcapacity of most key components and material continued during 2014, with many facilities running at partial capacity.106 In most areas of the supply chain, overcapacity is providing greater choice, flexibility, and cost control.107 In some countries, however, the industry has struggled as a result. In China, for example, several manufacturers have fought for survival, with the number of turbine manufacturers falling from more than 80 in 2009 to about 30 in late 2014 (although the situation improved for some in 2014).108 In Europe, declining markets due to i - Small-scale wind systems generally are considered to include turbines that produce enough power for a single home, farm, or small business (keeping in mind that consumption levels vary considerably across countries). The International Electrotechnical Commission sets a limit at approximately 50 kW, and the World Wind Energy Association (WWEA) and the American Wind Energy Association define “small-scale” as up to 100 kW, which is the range also used in the GSR; however, size varies according to needs and/or laws of a country or state/province, and there is no globally recognised definition or size limit. For more information see, for example, Stefan Gsänger and Jean-Daniel Pitteloud, 2015 Small Wind World Report (Bonn: WWEA and New Energy Husum, March 2015), Summary, Summary_SWWR2015_online.pdf. ii - Data are for end-2013 with the exceptions of Canada (year 2010) and Ukraine (2011).

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