Global offshore wind power capacity is set to rise at least 15-told to about 350 GW by 2040, says a new report by the Paris-based International Energy Agency.

In what some media speculate as a change in IEA's previous skepticism about renewable energy's place in the global power mix, IEA Executive Director Fatih Birol says in the report that offshore wind's "potential is near limitless," adding that "improved technology and steep cost reductions are putting more and more of that potential within our reach.”

The energy group says total global capital spending is predicted to reach $840 billion by 2030, and will need to rise to $1.2 trillion to meet climate change and sustainability targets.

Europe will continue to be market leader with China in second place, while the U.S. is forecast to follow by installing nearly 40 GW at a cost of $100 billion.

Norway offshore wind developer Equinor, formerly its national oil company Statoil, propelled the market in recently awarding contracts worth $360 million for the first-ever floating wind turbines to serve offshore oil and gas production platforms.

When operational in 2022, the $544-million Hywind Tampen development will supply around 35% of power demand of five North Sea platforms.

The 11 turbines, each 8 MW, will be located 140 km offshore Norway in waters 260-300 deep and will reduce platform emissions by 200,000 tonnes a year, according to Equinor.

Kværner A.S. will build the substructure and install turbines to be supplied by Siemens Gamesa Renewable Energy A.S. Each turbine will be supported by a single floating cylindrical spar buoy, which will be anchored to the seabed.

The ballasted steel cylinders have a 85-90 m design draft and 12,000-tonne displacement.

Equinor and Siemens Gamesa have pioneered floating wind farms since 2009 in offshore Norway and Scotland.

Also, France-based floating platform developer Ideol has just joined with Belgian renewables energy producer Elicio N.V. to bid next year in Crown Estates Scotland’s ScotWind offshore lease auction.

Political Support

Based on IEA's assessment of country energy strategy, offshore wind power’s contribution to global supply will rise from 0.3% now to 3% by 2040. After growing by nearly 30% a year in 2010-2018, the world market now includes about 150 new offshore projects in active development.

“Government policies will continue to play a critical role in the future of offshore wind and the overall pace of clean energy transitions around the world,” the report says.

With strong political support, particularly in the UK, European Union nations installed nearly 20 GW of offshore wind farms by the end of last year, with plans to increase capacity four times by 2030.

In China, the government has overseen installation of 1.6 GW of capacity, more than any other country.

In the US, state-level targets “have set the course for rapid growth over the next decade,” according to IEA, although moves this summer by the Trump Administration to require the country's leading project to reassess environmental impacts has upended its intended construction start by year-end.

It is not clear how soon next year the Vineyard Wind project in Massachusetts will gain needed permits.

Meanwhlie, other Asian nations, particularly India, Korea and Taiwan, have “ambitious targets” while Japan and Canada are among countries “laying the groundwork for future offshore wind development," says IEA.

The developing market is drawing more firms into its global supply chain.

Australian engineer-contractor Worley will pursue offshore wind design with its purchase earlier this month of 3sun Group, a leading UK-based firm in the sector, for about $38 million.

Worley, recently renamed from WorleyParsons after completion of its purchase of the chemicals and industrial group from Jacobs, says 3sun Group has about 25% of the UK offshore wind turbine installation, maintenance & inspection services market and about 15% of the European market.

3Sun Group had been owned by private equity firm BGF since 2014. Details of a new title and role scope for the engineer's founder and CEO Graham Hacon were not announced.

Worley was also awarded earlier this year an offlshore wind design contract in the U.S. by leading developer Orsted for two substations to be built for its Revolution Wind offshore project, to be located 15 km off the southern coast of Rhode Island.

The Australian parent says offshore wind energy provided higher yields than onshore due to stronger and more consistent winds.

Speed Bump?

But Denmark-based Orsted noted in an Oct. 29 public filing of its quarterly results that it has cut power production forecasts across its global projects due to new wind speed analysis only now available through improved modeling technology. It shows wind slowdown with turbine interaction and from interference from other wind farms.

Sector experts say speed barrier issues are long-known and foresee turbine-capacity improvements and other technology advances and better power output modeling as expected mitigators for the concerns.

"As ‘mature’ as the wind sector seems, we are constantly pushing the envelope with technology and the environmental conditions in which they are deployed,” Danish researcher Katherine Dykes told sector online publication Recharge.

Orsted reported income from operating wind farms up 35% in the quarter but also projected staffing cuts between 2020 and 2022,

Orsted stock fell 8% on the news and likely investors' skittishness over potential longer payback, but observers believe their reaction is short term.