Bottlenecks in the global wind industry supply chain could leave the world with only three-quarters of the wind energy installations needed by 2030, according to the Global Wind Energy Council (GWEC)
The 700GW gap to meet the for a 1.5°C pathway is due to supply chains in the wind sector for minerals, components and key enabling infrastructure like ports and platforms being not fit-for-purpose for a net zero world, the report states.
Today’s global installed wind fleet must scale up by roughly three times by the end of the decade, it added.
Mission Critical: Building the global wind energy supply chain for a 1.5°C world assesses the implications for energy transition policy across four future macroeconomic scenarios by 2030.
It looks at how broader global developments like rising inflation and open-door trade versus increased trade barriers will impact the wind supply chain landscape, market size and sustainability of industry returns.
The analysis found that the wind supply chain is highly globalised, with a strong focus in China for rare earth element refining and component manufacturing in particular.
The report calls for a resetting of political priorities towards industrial resilience and security in many areas of the world, including Europe and the US, in addition to increasing market volatility, poses risks for creating a competitive and sufficiently scaled-up global supply chain.
In addition, policy and regulatory issues around permitting, grids, investment certainty and localisation are also holding back volume in the wind pipeline, which could otherwise send positive demand signals for supply chains to scale.
GWEC chief executive Ben Backwell said: “This is a watershed moment for getting trade and industrial policy in shape for a 1.5°C world.
“Wind energy will form the backbone of the future energy system based on renewables, but in order to enable a tripling of the world’s wind installations by 2030 we require a globalised, secure and competitive supply chain.
“Governments must work with the industry – and the industry must work together – to ensure the sector meets the enormous demand for clean and secure energy within this decade.
“Investment in supply chains has seen setbacks in many regions of the world, largely caused by challenges in policy, regulation and market design while industry itself needs to step up to the climate emergency by embracing standardisation with more global and modular technology design.
“Everyone has a role to play in this mission to create stronger and more resilient supply chains for the energy transition.”
The report explores the impact of four different macroeconomic scenarios, and how the wind industry can best navigate uncertainty and change in the global market.
An “Open Door” approach would yield the highest net-positive impact in wind growth to reach climate goals, but the report anticipates the “Increased Barriers” scenario as the most likely to materialise in this decade.