In the wake of a global pandemic, rising energy costs, periodic shortages of raw materials, and high inflation rates, the wind energy sector is facing challenges but remains resilient.
According to Grand View Research, the global wind power market was valued at $99.28 billion in 2021 and is projected to grow at a compound annual growth rate (CAGR) of 6.5% from 2022 to 2030. This underscores the significant potential for future development in both onshore and offshore wind power.
The industry’s dynamic nature, characterized by rapid innovation and unpredictable political factors, has created a new normal that differs from just two years ago. While Europe is experiencing a contraction in the wind energy sector (except for Germany, which is expanding rapidly), global wind power generation increased by approximately 273 terawatt hours (TWh) in 2021, marking a 17% growth rate, surpassing other power generation technologies.
China played a pivotal role, contributing nearly 70% of the growth in wind generation in 2021, followed by the United States at 14% (where the sector supported over 120,000 jobs in 2022) and Brazil at 7%, according to the International Energy Agency (IEA). With this growth and the emergence of new challenges, the availability, production, distribution, and, notably, transportation of wind turbines and components have become increasingly critical.
IATA classifies wind turbines as special cargo due to their large size. This classification entails specific requirements for packaging, labeling, documentation, and handling throughout the transportation process. Consequently, the transportation of wind turbine components necessitates specialized logistics partners, as not all can handle such cargo. The wind energy industry globally requires a dependable integrated logistics partner capable of delivering the necessary capacity when needed while maintaining cost efficiency, flexibility, and a strong emphasis on safety.
In the midst of these evolving circumstances, wind energy businesses must prepare for changes within their industry and their logistics operations.
Predicted Wind Energy Trends for 2023
Offshore Wind Taking Center Stage:
According to the IEA’s 2021 report, out of the total 830 GW of wind capacity installed, a significant 93% was attributed to onshore systems, leaving a mere 7% for offshore wind farms. This disparity is because onshore wind technology is well-established and operational in 115 countries worldwide, while offshore wind is still in the early stages of expansion, with capacity found in only 19 countries. However, the landscape is changing due to innovative developments, as businesses are now starting to revamp their offerings in the offshore wind farm sector. Solarwind, for example, predicts that offshore wind reach will grow in the coming years as more countries either develop or plan their first offshore wind farms. Just recently, China announced plans to construct the world’s inaugural offshore wind farm utilizing 16 MW turbines, capable of generating 400 megawatts (MW) and producing approximately 1.6 terawatt hours (TWh) of electricity annually. The Global Wind Energy Council (GWEC) underscores that varying geographical conditions will favor different solutions. Whether it involves floating offshore wind farms or those anchored on the deep seabed, the prospect of utilizing open waters to host wind turbines presents an exciting opportunity for new markets to enter the industry. However, this expansion also brings unique logistical requirements. Wind power logistics will require integrated providers capable of efficiently moving these components first on land and then over water, ensuring both ease and utmost safety in the process.
The wind power industry is witnessing a rapid influx of cost-effective and reliable innovations, including rooftop bladeless wind turbines, vertical-axis turbines, floating multi-turbine technology platforms, and more. Increased interest and investments from global energy players have breathed new life into technological advancements within the sector. The pace of change in this industry is astounding. Initially, we anticipated the development of +10 megawatt (MW) turbines over the next decade, but now we’re seeing announcements of 18MW turbines entering production, capable of generating 80 gigawatt hours (GWh) of electricity, enough to power 96,000 residents annually while reducing CO2 emissions by 66,000 tons. As technology in this field evolves, so do the requirements of businesses engaged in sustainable energy production, as pointed out by Henrik Willum Dalsgaard, Global Vertical Head of Wind Power and Renewables at Maersk. Robotics and automation are also making their presence felt, along with expanded logistical capacities for both onshore and offshore operations. This trend is expected to drive down installation, transportation, and maintenance costs, presenting promising opportunities in the wind power logistics sector on a global scale.
Sustainability in Renewable Energy:
According to AZO Cleantech, the popularity of wind energy has increased significantly over the past few decades as a result of people’s increasing understanding of the value of clean energy and the need to combat global warming. However, the environmental impact associated with the production and transportation of renewable energy often goes unexamined. As we look ahead to the future of wind power generation, especially in the context of the 2050 Net Zero scenario, there’s a pressing need for even more rapid growth to meet the ambitious targets set for the global energy sector.
In the realm of wind power trends, innovation is playing a pivotal role in making the industry more environmentally friendly. For instance, there are now solutions aimed at eliminating the necessity for landfill disposal of decommissioned turbine blades. Furthermore, there is a heightened focus on adopting more sustainable end-to-end transportation methods for wind machinery and turbines, with a particular emphasis on reducing CO2 emissions. Many players in the wind power sector are making commitments to reduce their carbon footprint. This has spurred the demand for integrated logistics partners capable of moving special cargo in an environmentally responsible manner. Whether it involves transporting decommissioned parts to recycling facilities or their next destination for reuse, the need for sustainable logistics solutions is evident in 2023.
Strengthened Collaborations in Logistics:
The current year and the foreseeable future are expected to witness robust partnerships between wind power industry players and logistics providers. Since the 2000s, wind power has expanded quickly thanks to research, public support, and specific policies. These partnerships will place a strong emphasis on cost considerations as the industry grapples with the challenge of balancing moderate to high production costs while meeting the demand for lower prices from end customers.
Despite the region’s modest climate goals, wind and solar photovoltaics (PV) are still flourishing, supported by falling costs, and they play a significant role in European power generation, according to Deloitte. Emerging energy technology experts suggest that nations and markets lagging in wind power adoption can seize opportunities as costs decline and regulatory flexibility increases.
Wind Energy: Pros of Wind-Generated Power
Wind energy offers several advantages, with one of the most significant being its renewable nature. Wind is a constantly replenishing resource, ensuring a sustainable source of power. Furthermore, wind energy is an environmentally friendly option, as it produces no greenhouse gas emissions during its operation, in stark contrast to traditional fossil fuel-based power generation. Additionally, it reduces our dependence on finite fossil fuel reserves, thereby enhancing energy security.
However, wind energy does present certain challenges. One primary issue is the unpredictability of wind patterns. Since wind speeds fluctuate, the electricity output from wind turbines also varies. Managing this variability requires effective grid integration and storage solutions to maintain a stable and dependable power supply.
Visual aesthetics and potential impacts on wildlife are also factors to consider when planning and implementing wind energy projects. These necessitate meticulous site selection and thorough environmental assessments.
Advantages of Wind Energy:
- Renewable Nature: Wind is an inexhaustible resource, ensuring a continuous and sustainable power source.
- Environmentally Friendly: Wind energy generates zero greenhouse gas emissions during operation, reducing environmental harm.
- Energy Security: Wind power reduces reliance on finite fossil fuel reserves, contributing to greater energy security.
- Cost-Effective: Wind energy has become increasingly cost-competitive with conventional energy sources.
- Job Creation: The wind energy sector offers employment opportunities in manufacturing, installation, and maintenance.
Challenges in Wind Power:
Competing with Traditional Generation Costs:
Wind energy faces the ongoing challenge of competing with the lower costs associated with traditional electricity generation sources. Despite significant cost reductions in recent decades, wind projects must still strive for economic viability in comparison to cheaper electricity alternatives.
The expenses related to operations and maintenance (O&M) at U.S. wind farms ranged from $42,000 to $48,000 per MW in 2016. These costs can be subject to considerable variations from initial projections, underscoring the critical role of preventative maintenance in preserving wind farms’ optimal functionality and keeping O&M expenses as low as possible.
Rural Project Locations:
Land-based wind projects are often situated in rural areas, distant from urban centers with high electricity demand. Consequently, the construction of transmission lines becomes a necessity to transport the generated power to where it is needed.
Noise and Visual Concerns:
Although wind projects have a significantly smaller environmental footprint compared to traditional power plants, concerns persist regarding the visual impact of wind turbine towers on landscapes and the noise generated by their lengthy rotor blades.
Land Utilization Competition:
Land-based wind projects frequently find themselves in competition with alternative land uses that may offer greater revenue potential than electricity generation.
As we step into the world of wind energy logistics in 2023, I’d like to highlight the exciting trends we’re about to witness. These trends are all about innovation, connectivity, and the growing need for seamless collaboration.
In this dynamic realm of wind energy, your quest for the perfect logistics partner should revolve around flexibility and the ability to provide precisely what you need, precisely when and where you need it. If you’re a wind power business like yours, seeking a logistics partner this year is a personalized journey. Look for someone with a vast network that opens doors to countless possibilities. Seek out a partner who not only embraces cutting-edge technologies but also places safety at the forefront. And, most importantly, find a partner who understands your industry inside out, offering the knowledge and insights to guide your investments and secure your growth for years to come.