Electrical Equipment / Components & Telecoms

2020 is an extraordinary year. Although the new crown epidemic will have a certain degree of impact on the wind power supply chain and project construction, the global new installed capacity of wind power will still reach a record high due to the rush to install in the two major markets of China and the United States. 93 GW. According to data from the National Energy Administration, as of the end of 2020, the cumulative installed capacity of wind power across the country has reached 281 million kilowatts, of which onshore wind power is 271 million kilowatts, and offshore wind power is about 9 million kilowatts. This makes China the veritable largest country in wind power, better than the second-ranked country. The United States is 130% more than the total installed capacity in Europe, which is 1.2 times. However, in terms of the proportion of wind power in total electricity demand, China is currently not only lagging behind European and American countries, but also slightly lower than the global average.

Cumulative installed capacity of wind power in some countries and regions in 2020 and its share of total power demand

Data source: GWEC, IEA, 2021

In terms of global response to climate change, 2020 is also a very special year. We have not only witnessed the European Union, Japan, South Korea, Canada, South Africa and other economies making a commitment to achieve carbon neutrality by 2050, Chinese President Xi Jinping also made a statement to the international community at the general debate of the 75th United Nations General Assembly. Solemnly declare: Strive to achieve carbon peak by 2030, and strive to achieve carbon neutrality by 2060. China is the world's second largest economy and the largest carbon dioxide emitter. This commitment is considered to be the most important milestone in the process of mankind's response to climate change since the Paris climate agreement was reached in 2015.

In 2021, the world will continue to make breakthroughs on the journey of tackling climate change. At the beginning of this year, the new President Biden announced that the United States would return to the Paris Agreement. In April, at the "Leaders' Climate Summit" convened by the United States, more than 40 national leaders, including Chinese President Xi Jinping, reiterated or updated their voluntary emission reduction targets at the meeting. On behalf of the United States, Biden pledged to reduce greenhouse gas emissions by 50-52% compared to 2005 by 2030, and to achieve carbon neutrality by 2050. In addition, the President of Brazil also announced at the summit to join the 2050 carbon neutral camp. According to the latest statistics of the International Energy Agency (IEA), as of April this year, forty-four countries and the European Union have made carbon neutral commitments, which represent approximately 70% of global carbon dioxide emissions and GDP. Obviously, the fossil energy era represented by oil and gas will soon come to an end, and the global energy transition with new energy as the mainstay will be unstoppable. In the "Energy Zero Carbon Emission Roadmap to 2050" report released in May this year, IEA predicted that wind power and photovoltaics will provide approximately 70% of the world's electricity demand in 2050. To achieve this goal, the IEA called in the report that the pace of global wind power and photovoltaic installations must be further accelerated in the next ten years. By 2030, the annual new installed capacity of wind power must reach 390 GW, and it will still be maintained at 350 GW by 2050. s level.

Data show that, driven by the trend of carbon neutrality, global wind power is accelerating its deployment. According to the latest statistics from GWEC, the total global wind power bid in the first quarter of 2021 was 6,970 MW, 1.6 times that of the same period last year. In addition, the scale of bidding for wind power projects announced in the first quarter has also increased, with a total of over 14 GW. These two sets of data not only show the resilience of the wind power industry during the new crown epidemic, but also show that wind power is becoming an important engine for the green recovery of the economies of various countries.

At the end of December 2020, the U.S. Senate passed the Comprehensive Appropriation and COVID-19 Relief Act. The extension of the production tax reduction policy (PTC) for one year also ensures that the steady development of the onshore wind power market can continue until 2025. At the same time, the bill also extended the investment tax deduction policy for offshore wind power until the end of 2025, which undoubtedly provides the most important guarantee for the US offshore wind power market, which is still in its infancy. This policy has not only won the investment confidence of overseas and local developers, but also paved the way for the creation of a domestic offshore wind power supply chain. In order to quickly start the offshore wind power market and create local employment opportunities, in March this year, the Biden government set a target of 30 GW of offshore wind power installed capacity by 2030, which will also lay the foundation for the United States to achieve 110 GW of offshore wind power installed capacity by 2050. In response to the serious lag in project approvals faced by offshore wind power during the Trump administration, the new government has also specifically authorized the Ocean Energy Administration (BOEM) of the Ministry of the Interior to expedite the approval of offshore wind power projects. In February of this year, the Vineyard offshore wind power project (800 MW), which had already withdrawn its construction permit application, restarted the application process, and was approved by the federal government in May. This project is not only the first large-scale commercial-scale offshore wind power project approved in the United States, but also marks the true start of the US offshore wind power market. In addition, according to the latest statistics from the Lawrence Berkeley National Laboratory in the United States, as of the end of May this year, wind power projects with a total capacity of 209GW have begun to queue up in the United States, preparing to apply for grid connection permits, of which nearly 30% are offshore wind power projects.

In Europe, wind power has already accounted for 16% of total social electricity demand in 2020. The European Commission’s 2050 route scenario forecast shows that if the EU is to achieve its carbon neutrality target by 2050, the installed capacity of onshore and offshore wind power needs to increase from the current 194 GW and 25 GW to 750 GW and 450 GW, respectively. In the "European Green Agreement" announced by the European Union at the end of last year, the EU's offshore wind power installed capacity target in 2050 was officially set at 300 GW.

In October 2020, Prime Minister Yoshihide Suga announced Japan’s goal of achieving carbon neutrality by 2050. The Japanese government and the wind power industry also reached a joint agreement similar to the one signed by the British government and the offshore wind power industry in 2019 at the end of last year. As part of the Japanese government's green development strategy, the agreement has set targets for Japan's offshore wind power installations of 10 GW in 2030 and 30-45 GW in 2040.

Only two days after Japan announced its goal of carbon neutrality, South Korean President Moon Jae-in also announced that South Korea would join the camp to achieve carbon neutrality and strive to get rid of its dependence on fossil fuels. Like neighboring Japan, South Korea also regards new energy as an important part of its "Green New Deal". In February of this year, President Moon Jae-in, on behalf of the South Korean government, signed an offshore wind power development agreement in South Jeolla Province with 33 South Korean companies. The total amount reached 8.2 GW and the total investment amounted to 36 billion euros. At present, South Korea’s installed offshore wind power capacity is only 133MW. In order to achieve the 12GW offshore wind power installation target in 2030, Moon Jae-in announced in May this year that South Korea will build 6 GW of floating offshore wind power offshore Ulsan by 2030, with a total investment of 27 billion euros. . This is the largest floating offshore wind power project announced in the world so far.

In Australia, wind power and photovoltaics are still considered to be the cheapest energy technologies even if the cost of energy storage and grid connection is included. Last year, Australian wind power installed 1.1 GW, a record. As of the end of 2020, its cumulative wind power installed capacity exceeded 7 GW, which can meet 10% of the country's electricity demand. Currently, the capacity of wind power projects under construction and financing in Australia has exceeded 5 GW. Although the Australian electricity market operator AER raised concerns about the future integration of new energy projects, AER finally approved the investment in the "EnergyConnect" grid project at the end of May this year, with a total investment of US$2.3 billion. The project is scheduled to start construction at the end of this year. After it is put into production, it is expected to be integrated into wind, solar, and solar energy storage projects of at least 10 GW in three states.

Despite the impact of the epidemic, Brazil still achieved more than 2GW of new installed capacity last year, ranking third in the world. The bidding originally scheduled for 2020 was cancelled due to the epidemic, but the Brazilian government decided to complete four rounds of bidding for A-3, A-4, A-5, and A-6 in June and September this year, respectively. As the cost of wind power is very advantageous in Brazil, non-government bidding and bilateral project agreements are also very active, and it has become an important driving factor for the development of the wind power market. In addition, in March this year, Brazil passed the Senate's proposal PL 576/2021, which will initiate the formulation of the industry's long-awaited regulatory framework for marine energy development.

In Africa, the South African cabinet announced in September last year that it would achieve carbon neutrality by 2050 and decided to restart the tender for new energy. In addition to the 2.6 GW new energy project tender announced in the first quarter (including 1.6 GW of wind power projects), the South African government has decided to hold 2.6 GW and 1.6 GW of new energy tenders in August this year and early next year, respectively.

2020 is a record year. In the face of the epidemic, new global wind power installed capacity will still increase by 53% over the previous year. This is the pride of global wind power people! China’s newly installed capacity exceeded 50GW last year. The wind power industry successfully achieved the goal of the “Beijing Wind Energy Declaration” in October last year for the annual increase of installed capacity during the “14th Five-Year Plan” period. This is the pride of Chinese wind power people! Although the trend of carbon neutrality has further heated up global new energy investment, there is still a large gap between the current new installed capacity and the new installed capacity suggested by the IEA zero-carbon roadmap. 2021 is the opening year of the critical decade for global climate change. I hope that China’s wind power industry can continue the passion of 2020 and actively support the 26th United Nations Climate Change Conference (COP26) held in Glasgow in November this year, so that wind power will be global Play a more important role in the process of tackling climate change. Wind power development still has a long way to go, and wind power people must continue to work hard!