Prospects for wind power cool down. European association does not expect Portugal to install offshore wind farms by 2030

Europe will continue to see an expansion of wind farms, although at a slower pace than previously estimated by a European industry association, WindEurope. Delays in licensing and expansion of the electricity grid are two of the reasons cited. However, there are examples of acceleration, such as Germany. In the case of Portugal, an increase in onshore wind energy installations is expected, but offshore wind capacity is not expected to increase until the end of the decade.

Europe built 6.8 gigawatts (GW) of new wind capacity in the first half of this year, of which 89% was installed onshore (onshore wind energy) and the rest offshore (offshore wind energy). Europe now has 291 gigawatts of wind capacity, 254 GW onshore and 37 GW offshore, according to WindEurope, in a report taking stock of the industry with data collected from January to June.

“Onshore wind energy is expected to account for the majority of installations by 2030”, the association points out in the document, expecting 135 gigawatts of this energy to be installed between this year and 2030. This would mean that, taking into account the farms that are at the end of their life, Europe will reach 2030 with 441 gigawatts.

WindEurope is an association representing the wind industry at European level, with more than 600 members based in around 35 countries, ranging from companies across the value chain to the financial and insurance sectors.

Overall, “delays in licensing and electricity grids are particularly challenging” for the industry, as is a lower-than-expected electrification rate, the association points out. “This has led to a downward revision of the outlook for onshore and offshore wind energy until 2030”, the association writes. The expectation of 22.5 GW in 2025, put forward by WindEurope at the beginning of the year, has been reduced to 19 GW.

“Less wind capacity is bad news for Europe’s competitiveness”, concludes WindEurope CEO Giles Dickson. Nevertheless, the association indicates that final investment decisions in the first half of 2025 exceeded the total for 2024, reaching €34 billion, of which €22 billion relates to offshore projects.

Germany stands out. Portugal slips in offshore

The scenario differs depending on geography. In Germany, highlighted as a positive case, the outlook has improved mainly due to “strong licensing activity”, with licences being awarded within 18 months. This country is expected to contribute with the installation of 43 gigawatts by 2030. In the statement accompanying the balance sheet, WindEurope points out that Europe’s economic engine is expected to build a total of 5 gigawatts this year alone, “more than has been built in the last five years” in this country.

In contrast, the association’s expectations for Spain, France, Sweden, Denmark and Italy have cooled. In the cases of Spain and Denmark, the absence of auctions and low electricity prices resulting from the widespread installation of solar power are detracting from the potential for wind energy. Low electricity prices also appear to be holding back investment in wind energy in Sweden, as do higher grid usage fees. In France, the rise of far-right forces in Parliament is causing delays and obstacles, writes WindEurope.

Looking at Portugal, WindEurope predicts that by 2030, a total of 2,340 megawatts will be installed, all onshore. The country is therefore expected to reach a total of 6,650 megawatts of onshore wind capacity, maintaining around 25 megawatts offshore — EDP’s project off the coast of Viana do Castelo, in operation since 2020, has a total of 25 megawatts. However, in the first half of this year, only 2 megawatts were installed in the country, according to the report.

Offshore falters, but still grows

Offshore wind farms have encountered some setbacks, but the trend is still towards growth, WindEurope points out. In the five years to 2030, 43 gigawatts of capacity are expected to be installed, bringing the installed offshore wind capacity by the end of the decade to a total of 80 GW. A large part of the new capacity — 35 GW — relates to winning auction projects, for which investment decisions have already been made and construction and investment contracts signed, so the association expects them to be completed within the indicated deadlines. Another 7 GW are expected to go to auction in the coming years, according to WindEurope.

At the beginning of 2021, European governments set a target of installing 114 GW of offshore wind power across Europe. At the end of 2022, they revised the target upwards to 158 GW. “Since this peak, many national governments have backtracked on their 2030 targets”, the report reads.

This is because, the text indicates, governments need more time to establish regulatory guidelines, improve access to the electricity grid and develop local supply chains. Declining demand for green hydrogen is also said to have hampered a Dutch project. In the United Kingdom, a project was cancelled due to “difficult” financing conditions, logistical challenges and rising costs.

The association also surveys the auctions planned between 2025 and early 2026, making no mention of the Portuguese auction. Germany, the United Kingdom, France, Poland, Denmark, the Netherlands and Lithuania are the countries highlighted by WindEurope as having auctions planned until the end of 2025. Belgium and Italy are examples for 2026.

When asked about the absence of any reference to Portugal, a spokesperson for WindEurope stated that the association does not believe that the Portuguese auction will take place this year, adding that even if it did go ahead by December, it would be unlikely that the winning projects would be built before 2030, which explains the absence of estimates for the installation of offshore wind capacity over the next five years. In the latest version of the National Energy and Climate Plan, presented in the middle of last year, the Government committed to achieving a capacity of 2 gigawatts of offshore wind power by 2030.

Last April, an order was published in which the Government predicted that the rules for the auction of wind farms in Portuguese waters would be defined within six months, i.e. by October.

The Ministry of Environment and Energy states that the deadlines set are being met. “By the established deadline, news will be released on the basic principles of the auction for the development of offshore wind energy production”, the ministry also guarantees. At a later stage, based on the work carried out, the competitive procedure documents will be drawn up.

Speaking to ECO/Capital Verde, the president of APREN — Portuguese Renewable Energy Association, Pedro Amaral Jorge, acknowledges that, given that offshore wind projects generally take between 7 and 9 years to mature, it is “unlikely” that Portugal will be able to achieve its target of 2 gigawatts by 2030. However, “the important thing is that even if we deviate from the deadline, we do not deviate from the target”, he believes, while calling for the creation of market and licensing conditions.