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Mood in offshore wind industry somewhat improved, despite COVID-19

The impact of the corona pandemic is felt across all aspects of life and all parts of the economy. However, according to the fifth WindEnergy trend:index, contrary to most sectors, the mood in the German wind industry has improved slightly in spring of 2020 despite an unchanged political environment.

Germany is seeing an end to the negative trend that was evident in the previous trend:index surveys, showing improved market assessments in the wind industry for both 2020 and the next two years. In the international wind market, assessments of the current mood in the onshore and offshore wind industry are largely positive, if slightly down from previous surveys. Expectations for the coming years are markedly more optimistic, however, with the market development mostly receiving more positive marks indicating an upward trend, and additional potential being perceived in the progressing digitalisation and the uptake of green hydrogen.

These are the results of the new WindEnergy trend:index (WEtix), which is prepared jointly by WindEnergy Hamburg, the global onshore and offshore wind energy event, and wind:research, the leading market research institute for wind energy. The global WEtix survey has been gauging the mood in the wind industry every six months since 2018. More than 1,100 market players participated in the fifth survey in March and April 2020.

Since the spring 2020 survey was designed and developed prior to the implementation of the comprehensive lockdown measures in response to the coronavirus crisis, and since it was deemed important to avoid compromising its comparability with previous surveys – acknowledging that the ‘corona’ effect is likely unique (even if it persists for a while), – this WEtix purposely contains no questions specifically referring to the coronavirus. It should be noted nevertheless that the survey was conducted from 17 March until 29 April 2020, a time during which the spread of the COVID-19 virus was affecting much of the world already. This makes it very likely that some answers where influenced by the coronavirus crisis.

In Germany the negative trend prevailing over the past two years has stopped. It should be noted nevertheless that the survey was conducted from 17 March until 29 April 2020, a time during which the spread of the COVID-19 virus was affecting much of the world already. After the assessments of the German wind industry in the November 2019 WEtix yielded new record lows, the current mood as well as the future prospects in the market are now seen in a more positive light. While the situation in both the onshore and the offshore wind markets is still in the negative range, there is a slight recovery. Considering the actual improvements, which remain marginal, this development is remarkable because it runs contrary to the trend in the world regions, all of which show declining values in the 2020 mood assessments. Expectations for the development of the onshore wind industry in Germany over the coming two years are much more positive while still remaining in the negative quadrant. The mood in the German offshore wind industry has clearly improved, as well.

“From the perspective of many market participants, things cannot possibly get any worse than they were in 2019. This is reflected in the numbers. But the fact that the general outlook remains below the zero line shows that hopes in the current federal government are subdued. The current coalition government could still surprise the industry with some positive measures. This would require a strong emphasis within the economic stimulus package. If the federal government takes decisive action now to eliminate the well-known barriers, the wind industry can play a significant role in supporting the post-corona relaunch of the economy while lending credibility to the Chancellor’s ambitious climate protection goals. In the absence of such decisions, however, our only hope will be quick government action after the next federal elections. What unites us is the notion that the wind industry is of essential importance”, says Hermann Albers, President of the German wind energy association PWE, assessing the current situation.

Looking at the current year, industry stakeholders take a less optimistic outlook on the international onshore wind energy market than in previous surveys. While the market situation in North America and Asia still receives positive marks despite some metrics revealing a significant decline, the results for Europe have dipped down into the negative range for the first time. On the other hand, expectations for the development of the onshore wind industry over the coming two years are much more positive, with a slightly above-average upward trend for Europe and North America. As for the global market situation in the offshore wind industry, the picture looks quite similar: while the mood for the current year remains positive for Europe, North America and Asia, all regions are trending downwards, some quite steeply. The trend in the offshore wind industry in North America, Asia and the rest of the world continues to receive positive assessments for the next two years, and the European markets are increasingly receiving optimistic marks, as well.