The global wind energy market size is expected to hit USD 190 billion by 2030 and is poised to grow at a compound annual growth rate (CAGR) 4.9% during the forecast period 2021 to 2030.
According to Vision Research Reports, the global wind energy market size was valued at USD 126 billion in 2020. The electricity is generated from kinetic energy by using wind energy. The wind turbine turns wind energy into mechanical energy, which is then transformed into electrical energy via the generator. The offshore and onshore wind energy is connected with land-based turbines, whereas offshore wind turbines are positioned in the sea or ocean. Offshore wind turbines, on the other hand, are more efficient than onshore wind turbines due to the steady wind flow.
The factors such as increased investments in renewable energy generation, combined with the initiatives to reduce carbon emissions, will raise the demand for wind energy technologies. Wind energy market growth is predicted to be fueled by a significant increase in demand for renewable energy sources. Governments all around the world are encouraging sustainable energy sources, which, unlike conventional power sources, may cut carbon emissions. Moreover, the offshore wind turbine technology removes the barrier of sea dept, allowing for the finest feasible power producing site to be selected.
The COVID-19 pandemic had a significant impact on wind turbine production nations such as Germany and China. Additionally, a major issue limiting market expansion is the scarcity of spare parts and maintenance staff. Due to a shortage of personnel and social distancing conventions, planned maintenance became a big challenge for industrial players during the high wind season. Furthermore, project delays and order cancellations impacted the primary markets for blade manufacturing and wind turbine installation.
Due to increased concern from governments across developing nations, such as India, Japan, China, and South Korea, about zero emission regulations, Asia-Pacific is likely to drive the market expansion. Due to increased investments in nations such as UK, Germany, and France, Europe is predicted to develop at the fastest rate in the wind energy market. Furthermore, the existence of key manufacturers which operate a substantial number of global wind power projects, would boost the wind energy market's growth.
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Top key players operating in the market are Suzlon Energy Limited, Prysmian Group, Sinovel Wind Energy Group Co. Ltd., Doosan Heavy Industries & Construction, Siemens, MHI Vestas.
Surge in demand for electricity
According to International Energy Agency (IEA), the demand for electricity has increased with 5% in 2020. This results into surge in demand for renewable energy sources. The solar energy, wind energy, geothermal energy, hydropower, tidal energy, and solar thermal energy are some of the types of renewable energies. The electricity is generated by converting wind energy into electrical energy with the help of wind turbines. A wind turbine has a capacity to produce 250 watts to 7 megawatts of electricity. The production number is high as compared to other types of renewable energies except hydropower. The rise in urbanization and industrialization has also resulted in increased in demand for electricity. The global population is around 7.9 billion. It means the population is growing rapidly all around the world. Thus, the growing population, rise in industrialization and urbanization, and rise in disposable income is giving rise to demand for electricity in the market. As a result, surge in demand for electricity will propel the growth of wind energy market.
Increase in government initiatives and investments in R&D
The government of developed and developing nations is taking constant initiatives for the improvement of wind energy resources. Also, number of wind energy polices have been designed to improve the condition of wind power generators. Several energy policies have aided in the scaling up of wind deployment and boosting its economic viability, all while serving country-specific economic, social, and environmental development goals. The countries such as Chile, India, Nicaragua, Thailand, the UK, the U.S., Germany, and Denmark have implemented variety of energy policies for the development and deployment of wind energy. Also, the government of various nations has also started working on research and development on renewable energy sources. Thus, the increase in government initiatives and investments in R&D will drive the wind energy market growth.
High capital cost
The application of wind power turbines requires huge amount of capital investments. In many regions, the company needs to fulfil various processes and steps of government for the installation of turbines, which also requires high investment. The huge costs are required not only for turbine installation but also for foundation, grid connection, control systems, land, road construction, electric installation, and other financial costs. Thus, the high capital costs are hindering the growth of wind energy market.
Rising deployment of renewable energy sources
Currently, renewable energy sources provide nearly 80% of global energy and 66% of electrical generation. This has increased the importance of renewable energy sources around the globe. The renewable energy is regarded as clean energy with zero emissions that do not pollute the atmosphere. Thus, many countries have shifted to cleaner sources of energy such as wind energy. The government has started to provide subsidies for the wind energy turbines in various regions. The renewable energy technologies are deployed more quickly as energy policies and regulations are making renewable energy projects more financially feasible. Thus, the rising deployment of renewable energy sources is providing lucrative opportunities for the growth and development of wind energy market.
Unpredictable climate conditions
The biggest challenge that wind energy market players face is the uncertainty of climate and weather conditions. Climate plays a significant role in the management and maintenance of offshore wind farms, particularly in determining when to access the turbines, therefore reliable, continuous weather data and information will be required from all sides of the operation. The output of the turbines is also influenced by the weather. It gets higher energy output when there is a lot of wind than when there isn't much wind, thus it's more likely to undertake maintenance when the winds are low to avoid downtime. This is also the most convenient and safest time to visit the turbines. Thus, the unpredictable climate conditions acts as a hurdle for the growth of wind energy market.
By Rating Type, > 12 MW systems segment of the wind energy market is anticipated to register over 1.3% CAGR through 2030. These units are primarily utilized to fulfil the electricity demand from large scale industries and utility sector.
By Component type, the turbines segment accounted 61% revenue share in 2021. Easier availability of raw materials, ongoing advancements in the turbine technology, reduction in operational costs are few of the noteworthy factors boosting the product deployment over the last few years. The electrical infrastructure accounted for over 10% of the global wind energy market share in 2020.
Based on application, the utility segment accounted revenue share of over 96% across the global wind energy market in 2021. Moreover, the industrial sector has witnessed a significant growth rate on account of soaring population coupled with growing preference for consumer goods.
Asia pacific hit largest revenue share of over 51% in 2021, on account of rapid industrialization across developing countries and soaring population growth throughout the region.
Europe wind energy market is projected to reach over 5.2% CAGR through 2030 on account of growing penetration of onshore wind farms.
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