Our industry is no different to any other trying to weather the storm of this pandemic due to its wide-ranging effects on international trade and supply chains which have created delays and uncertainties for many industrial sectors.

In a recent report, WindEurope stated that while Covid-19 will have a moderate effect on international supply chains for wind energy, we will see delays in the development of new wind farm projects — which could have a knock-on effect for developers missing the deployment deadlines in countries’ auction systems.

We think it’s likely that many projects will see a delay of around three months, which is built into a normal delay scenario for an offshore project. Those projects currently under construction will be particularly susceptible to these delays, although in these cases as long as there are no additional significant delays, the time lost should be recoverable within normal planning and contingency. These delays may have more of an impact if they stretch beyond six months. However, the short and long-term impacts can only be fully assessed once individual projects have a baseline expectation for delay.

What we’ve seen on the transactional side of the market is that people are keen to continue working on deals and want these processes to continue where possible. There have been instances of investors pulling out of big investments, but these aren’t commonplace and most larger infrastructure investors seem to be proceeding as normal.

The shift to home-working has allowed most of the investment and development work to continue so there has been little impact there, however on the construction side, it is clear that developers and contractors are nervous about the potential impacts with supply-chain slowdown and factory closures likely to carry over into project delays.

While the lockdowns have led to historic reductions in global emissions levels globally, the accompanying socioeconomic impacts have, in many cases, delayed some of the most important climate events and policy announcements expected later this year including the COP26 conference in the UK.

While the EU’s goal of delivering 50% of electricity from wind (currently at 15%) in the next decade is admirable, investment has dropped in the past two years. Europe is simply not building enough wind energy to deliver the European Commission’s Green Deal with the current rate of installations needing to double to reach the goals set out in the plan.

It is also worth noting that the UK, Germany, Spain and Sweden provided over half of new installed capacity in 2019. If we are to reach these targets, then there will need to be significant shift in political will and clearer legislation across the entire EU in order to provide investors and developers with the security needed to fund and drive the drive the construction and delivery of projects.

Despite this challenge, there are clear signs for optimism. The International Renewable Energy Agency’s (Irena) recent Global Renewables Outlook report suggests that renewable energy could power a global economic recovery from Coronavirus and there is perhaps no better time to truly kickstart to the drive to decarbonise the global energy sector.

Irena predicts clean-energy investment could spur global GDP gains of almost $100trn between now and 2050, and clean-energy investments have proven to be a reliable asset class during global crises in comparison with other forms of energy generation — with wind farms still turning and making money for investors.

As an investment, renewable energy is still the place to be and this is an encouraging outlook. As we emerge from this crisis, the wind energy sector is well positioned to lead the world into a new era of growth.

Gary Bills is UK country manager at renewables consultancy K2 Management

Wind

'Post Covid-19, wind is well-positioned to lead the world into a new era of growth'