Impact of COVID-19 on Chinese Wind Industry: GWEC

GWEC recently hosted a webcast to discuss the impact that the COVID-19 crisis had on the Chinese wind market and how the industry is recovering.

Impact Chinese Wind Industry

The Global Wind Energy Council (GWEC) recently hosted a webcast with key stakeholders from the Chinese wind industry to discuss the impact that the COVID-19 crisis had on the Chinese wind market and how the industry is recovering.

This was the first webcast of GWEC’s Wind Industry & COVID-19 Response Hub, with participation from Qin Haiyan, Secretary-General at the Chinese Wind Energy Association (CWEA), Zhai Endi, Corporate Chief Engineer at Goldwind, Dick Xie, Offshore Product Line Director at Envision Energy as well as experts from the Global Wind Energy Council (GWEC) including CEO Ben Backwell, Strategy Director Feng Zhao, and China Director Wanliang Liang.

The Key Takeaways from the meeting were:

Impact of COVID-19 on China’s wind supply chain

  • Most manufacturers had shut down their facilities in January and February 2020, resuming production until late February.
  • Traffic bans and quarantine measures in China impact the supply chain, consequently:
  • Production capacity in regards to components and turbines has dropped drastically, and shipments of wind turbines will decline by roughly 30 percent throughout the year;
  • Wind project construction is much slower than scheduled. At least six months of delay is expected for onshore wind and even longer for offshore wind.
  • The global COVID-19 outbreak has exacerbated the already acute shortage of key components, adding stress on wind power development in China. Following the lockdown in countries such as Italy, Germany and Ecuador, imported raw materials, such as Balsa Wood and PVC, and key components, such as main bearings, gearbox bearings and IGBT chips, are now being restricted.
  • China’s wind power projects cannot be developed without technology and products from other countries, thus international cooperation is needed now more than ever.

Grid-connection deadline extension

  • Eligibility for China’s Feed-in Tariff: onshore wind projects approved prior to the end of 2018 need to be grid-connected by the end of 2020 and offshore wind projects approved need to fully grid-connected by the end of 2021.
  • In an initiative led be CWEA, Chinese companies have called for a six-month postponement of the deadline for grid connection. According to CWEA, the government understands the challenge, and it is very likely that they will take the necessary action to mitigate the negative impact of COVID-19, ensuring stable investment, growth and employment. The result is likely to be announced in the next 1-2 weeks.

China’s Wind Market Outlook

  • Considering the disruption on the domestic and international wind supply chain, CWEA downgraded its onshore wind forecast for 2020 from up to 35 GW to 20-25 GW.
  • Following the expected grid-connection deadline extension by NEA, 2021 is likely to be a big year with about 30 GW of onshore wind capacity forecasted to be installed.
  • 2023 and 2024 are expected to be difficult years in China after the previously approved project pipelines run their course.

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Ayush Verma

Ayush Verma

Ayush is a staff writer at saurenergy.com and writes on renewable energy with a special focus on solar and wind. Prior to this, as an engineering graduate trying to find his niche in the energy journalism segment, he worked as a correspondent for iamrenew.com.

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