Global installed offshore wind capacity will be about 251GW by 2030 up from 33GW at the end of last year, according to research by Rystad Energy.
The report said that combined capital and operational expenditure for the decade will be $810bn (€670bn), signaling an increasing shift of investments from oil and gas to renewable energy technologies.
Rystad said it expects installed capacity to hit an estimated 109GW by 2025, before rising to 251GW by 2030, growing by 22% a year on average.
Total expenditure will amount to $56bn in 2021 as almost 13GW of capacity is expected to be commissioned, lifting the cumulative global installed capacity to 46GW.
Yearly spending will continue to rise to $126bn in 2030, after a short-lived dip in 2022 and 2023, the researchers said.
Capex today accounts for 95% of the total expenditure, with opex representing only 5%.
The capex share is expected to decline to about 80% by 2030, as all the new installed capacity will require more operational spending to run and maintain.
Rystad said 2030 will be the year of the inflection point when offshore wind capex will be on par with offshore oil and gas greenfield capex – excluding exploration work – at about $100bn.
Europe, as the most mature market, is still expected to dominate offshore wind spending this decade, totaling about $300bn.
China dominated yearly spending between 2019 and 2021 due to its substantial annual capacity additions.
This decade, the country is forecast to spend about $110bn, Rystad said.
Outside of China, Asia is expected to see significant investments this year, driven by Vietnam and Taiwan.
Spending in South Korea and Japan will also increase beginning in 2023 as more projects are lined up.
However, the Americas region is falling behind due to the US Jones Act and delayed permitting processes for the US offshore wind industry.
This is pushing back the expected start-up years for a number of wind farms, the report said.
The region is expected to spend just over $70bn this decade on offshore wind projects.
Rystad Energy expects North and South America will only start spending substantial amounts on offshore wind in 2023.
Turbine manufacturing costs represent the largest share of capex for offshore wind developments with almost 40% of total investments.
This trend is expected to continue as countries, especially European ones, are increasingly deploying large turbines.
Foundation manufacturing is the second major cost element for building an offshore wind farm, with a share of about 15% of overall capex during towards 2030.
The report said the share of foundation spending to capex should remain at the same level since Rystad does not expect a significant influx of floating foundations this decade.
Cable manufacturing, consisting of array and export cables, accounts for about 14% of the total capex.
Combined with the cable installation cost, the segment weighs in at about 20% of capex.
Rystad said this cost is not expected to increase as we approach 2030, as larger turbines help reduce cable and installation costs despite projects moving increasingly further from shore.
Rystad Energy offshore wind analyst Petra Manuel said: “The colossal level of investments anticipated in the offshore wind industry this decade reflects the ambitious targets set by companies and governments alike.
“As the market matures and economies of scale are achieved, investments could surge further, sparking even more installed capacity.”