Wind Energy Industry R & D Spending to Top US$36.9 Billion by 2028

As the wind turbine market enters a new era driven by subsidy and tax credit free cost parity, a new generation of wind energy technology is poised to hit the market by 2020. Markets which are shifting towards a competitive tendering process continue to drive the need for higher AEP as well as lower CapEx, OpEx and LCOE.

Additionally, new technologies on blade segmentation and turbine erection will unlock previously untapped pockets of the global market, in both space constrained sectors or areas of complex terrain where conventional technology is not cost effective.

Collectively, the industry will spend approximately US$28.2B in private R&D by 2028, matched with approximately US$8.7B in public R&D funding over the same time-frame. The private investment represents an industry average of approximately 5.3% of expected revenue, and is a significant increase off the average industry low of approximately 2.7% back in 2013.

Regionally, Western Europe, Japan and China will dominate the R&D and technology development landscape, with North America lagging behind a bit due to an unfavorable political environment in the US and lack of meaningful government support for climate change technology.

India is potentially emerging as a hotbed of technology development as low costs and government initiatives on renewables and manufacturing competency development continue to drive optimism. GCC states are also poised to see an increase in spending on renewable energy technologies in general over the next 10 years.

Australia, New Zealand, Singapore, The Philippines, Malaysia, and Indonesia are likely to see some modest spending on R&D, as increased wind penetration increases awareness of technology function and development opportunities.

Eastern Europe, Latin America and Africa will see minimal R&D spend in the next 10 years, but they have an opportunity to grow as wind turbine capacity additions increase in those regions and economies recover.

The overall trend in onshore wind technology development appears to be focused on system integration. This is driven by expected growth in distributed generation technologies as well as the increasing cost competitiveness of solar technology. Wind turbine OEMs are shifting focus to go beyond just turbine production and incorporate energy storage and solar into turnkey systems with fully integrated controls.

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