India to lead APAC wind market

India will switch on a massive 48GW of new wind power in the coming decade as Asia Pacific excluding China (APeC) sets off on a construction spree that is expected to lead to record-setting market expansion in the region, according to research from Make Consulting.
Taken together, regional core markets India, Australia and Japan will commission almost 80% of the more than 79GW forecast to be brought online in APeC through to 2024, building on 2015’s 14% year-on-year growth rate.

“With the reintroduction of the key generation-based incentive and accelerated depreciation scheme in the last two years, the market has seen a rebound with the emergence of IPPs [Independent Power Producers] as a new driving force, building larger capacity wind power plants with larger capacity turbines,” says the Aarhus-based consultancy.

Beyond India, Australia and Japan will face “contrasting outlooks” chiefly driven by national energy policy.

“In Australia, the compromise over the national renewable energy target will see a 20% downgrade leaving less room for new capacity additions, though there remains a potential upside should the opposition Labor party regain power and reinstate the old target,” says Make, “while in Japan, high feed-in-tariffs have attracted a strong 6GW-plus pipeline of projects that should lead to the market taking off starting from 2016.”

Three virgin APeC markets are expected to start taking shape in 2015-2017, with Kazakhstan and Azerbaijan moving to build new wind farms to replace aging thermal power plants, and Indonesia now scouting suitable sites for development to supply electricity to remote populations.

Make foresees these markets “requiring time” to develop given weak policy incentives, but calculates they could add 2GW by the end of 2024.

According to the consultancy’s figures, new wind power capacity in APeC hit 3.7GW in 2014, equalling the record set in 2011 when India commissioned 3GW of new capacity.

“Offshore in APeC remains at a nascent stage with only 70MW,” says Make.

“Led by Japan, upcoming offshore developments are largely demonstration projects as each market tests their domestic turbines. India has expressed its intention to enter offshore but is still at preliminary stage of identifying suitable sites for development.

“It will take several years before commercial projects can be realised due to limited track record and getting finance to make them feasible.”