Governments have made clear their commitment to offshore wind as an important pillar of decarbonisation and energy security. However, despite the offshore wind industry proving its ability to provide carbon-free generation at premium but relatively competitive prices, the supply chain supporting the industry is struggling to scale up and will be an impediment to achieving decarbonisation targets if change does not happen.
The supply chain constraints stem from uncertainty over demand and a lack of profitability. In the context of tackling a multi-trillion-dollar climate crisis, the US$27 billion in investment needed to build out the offshore wind supply chain through 2030 does not seem like a lot of money. But as developers’ and suppliers’ margins have been squeezed, and developers cancel offtake agreements and delay projects, that amount is beginning to look out of reach.