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MARKETS EAST ASIA & PACIFIC OFFSHORE WIND hereas the foundations of commercial off- Vessel demand in China relies mainly on domestic sup- shore wind development are found in Eu- ply. Chinese yards also maintain a strong position in the rope (and Europe will remain the largest international vessel new building segment, both for con-

W overall regional market for offshore wind struction and logistics/support vessels.

activity in the coming decade), the rapid development of

TAIWAN, JAPAN, the large East Asia and Pacifc region provides both oppor- tunities and some challenges to the supply chain.

SOUTH KOREA

According to World Bank data, the technical potential Taiwan, Japan and South for the East Asia and Pacifc region amounts to over 15,000 Korea – much promise but

GW, of which ~27% is suited to bottom-fxed foundations measured development and and the balance foating technologies. 90% of the poten- high local content barriers tial is found in seven countries, which are (in descending have taken some of the shine order) Australia, China, New Zealand, Japan, South Ko- of the opportunity rea, and Taiwan. Of these countries, only New Zealand does not currently have offshore wind activity.

CHINA

The dominant East

Asia and Pacifc mar- ket, where domestic

Tier 1 suppliers are in- creasingly looking to in- ternational markets

After much initial excitement, underpinned by a clear

At end of 2023, operational offshore wind capacity development plan to support the deployment of ~1.5 in the region amounted to just over 32 GW, of which GW per year to achieve ~20.5 GW by 2035, Taiwan’s the majority was grid connected in the regions offshore offshore wind market has begun to face increased chal- wind powerhouse and world’s largest offshore wind mar- lenges, with only half of the 2035 capacity aspiration cur- ket, China. Growth in the Chinese installed capacity and rently awarded. ~5.1 GW of capacity is either operational the domestic supply chain has been rapid, mainly in the or under construction. Local weather and ground condi- bottom-fxed segment. Whereas the Chinese supply chain tions, high local content requirements, a one-year delay generally meets the majority of domestic requirements, in the Allocation Round 3.1 commissioning and grid leading Chinese manufacturers are playing an increas- connection deadline, and a challenging auction process ingly important role in the international market. Increas- have resulted in development being behind the aspira- ingly large Chinese made turbines and foundations are tion. The gap between reality and aspiration is impacting being supplied to projects in the major European market the supply chain which is looking to other East Asian and the emerging East Asian markets. Cable manufactur- market to fll order books. In the short- to mid-term, this ers Hengtong, Ningbo Orient Cable and ZTT have also means Japan and South Korea. Both markets are plan- supplied European projects. Of particular note, where the ning auctions before the end of 2024 to support their three dominant western turbine OEMS (Vestas, Siemens respective 10 GW and 14.3 GW aspirations by 2030. and GE) are focusing efforts on commercializing ±15 MW Despite the longer-term potential in these two markets, turbines, Chinese OEMS are developing a range of models both for bottom-fxed and foating wind technologies, from 16-20+ MW. There has been some resistance to the annual auction allocations remain comparatively small

Chinese players supplying European projects, but where (below 1.5 GW), and we anticipate that local supply performance, price and delivery times all count, we antici- chains will continue to demand more project activity to pate an increasing role of the Chinese supply chain in the justify capacity investments. As with Taiwan, we antici-

European and East Asian markets. pate that projects in Japan and South Korea will require

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