Technavio market research analysts forecast the global wind turbine castings market to grow at a CAGR of more than 7% during the forecast period, according to their latest report.
The market study covers the present scenario and growth prospects of the global wind turbine castings market for 2017-2021. The report also segments the market based on material type into steel, glass-reinforced plastic, concrete, copper others. The steel segment accounted for more than 52% of the market share in 2016.
Technavio analysts highlight the following three market drivers that are contributing to the growth of the global wind turbine castings market:
Growing demand for electricity
One of the major driving factors for the global wind turbine castings market is the increasing demand for electricity, particularly in emerging economies such as China, India, Brazil, and South Africa owing to urbanization and rapidly increasing population. As of March 2017, the requirement of electricity in India was 11,39,076 MU, while the availability was 11,31,088 MU, falling short by 7,988 MU.
“India along with other countries offer huge opportunities for replacement of non-renewable sources of energy. The growing demand for electricity translates into increased demand for cost-efficient wind energy, thereby providing an opportunity for the global wind turbine castings market to capitalize,” says Kshama Upadhyay, a lead analyst at Technavio for metals and minerals research.
Increasing government spending on energy systems
The increasing government focus on energy systems and research is fueling the growth of the global wind turbine castings market, with prominence in regions such as the US and Europe. The US Department of Energy (DOE) allocated more than USD 93 million in the fiscal year 2016 to lower costs, improve performance, and trigger the development of technologies used for wind power.
The US Department of Energy develops partnerships and projects along with national and industry laboratories to facilitate the production of innovative components and integrated system designs to improve the reliability and performance of offshore wind turbines. Therefore, increased government focus and spending on energy generating systems lead to increased manufacture and installments of wind turbines, translating into an augmented demand for wind turbine castings.
Green bonds fueling demand for the market
Green bonds refer to bonds with profits reserved for green investments and are issued as ‘green’ by the authorities. Vestas, the Danish wind-turbine producer, issued a green corporate bond involving EUR 500 million in 2014. Banks too have shown interest in green bonds. For instance, in 2014, the National Bank of Australia issued a green bond in connection to a range of seventeen wind and solar farms.
These green bonds fuel the demand for wind turbine casting, with increased investments in the installation of wind turbines. Green bonds support the transition of a company to aim at better results by offering considerable upfront investments.
“Green bonds offer an umbrella for clean energy and investments. The green label enables companies to be a part of the liquid green bonds asset class, thereby offering admission to a broader investor base to reduce their cost of capital,” says Kshama.
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