The global offshore wind industry is gearing up for a significant resurgence in 2025, with new capacity additions projected to reach 19 gigawatts (GW) and sector-wide expenditure anticipated to hit US$80 billion, according to a new report by Rystad Energy.
This rebound follows a slowdown at the end of last year, during which new installations fell to approximately 8 GW, 2 GW lower than the previous year.
A record wave of lease auctions is fuelling the resurgence, with Mainland China, the world’s largest offshore wind market, expected to account for 65 per cent of the new capacity.
With this increase, total additions will exceed the previous peak in 2021 by about 1 GW, surpassing the 7.7 GW added in 2024, 10.2 GW in 2023 and 9.3 GW in 2022.
While new capacity additions signal positive momentum, uncertainty surrounds lease agreements, the long-term contracts between landowners and wind-energy companies.
In 2024, a record 55 GW of offshore wind capacity was offered in lease auctions globally (excluding Mainland China).
However, not all of this capacity has been awarded, as offered capacity does not always translate into awarded capacity.
For example, the US saw no bids for its 3-GW floating wind auction in Oregon last year, while the Gulf of Maine auction awarded roughly 7 GW of the approximately 13 GW offered.
Lease auction openings are projected to decline in 2025, with an expected 30-40 GW available.
While significantly lower than 2024, this projected offered capacity is still significant, aligned with levels seen in 2021 and 2022.
According to Petra Manuel, Senior Offshore Wind Analyst at Rystad Energy, “Global offshore wind is set for a robust year in 2025; however, certain signals could affect its smooth upward trajectory.
“US federal policy is creating significant global ripple effects, hindering offshore wind development, especially where a large portion of auctioned capacity lies.”
Manuel noted that President Donald Trump’s January memorandum halting new leasing and approvals on the Outer Continental Shelf (OCS), citing environmental and safety concerns, could last throughout his term, pausing new developments and creating continued uncertainty for ongoing projects.
Project delays significantly impacted final investment decisions (FID) for new offshore wind projects in 2024, leading to a decline in project approvals.
Only a few US projects reached FID in 2024, including Empire Wind 1, Sunrise Wind and Coastal Virginia Offshore Wind.
However, there is optimism for increased FIDs in the US this year with US Wind, Southcoast Wind and New England Wind projects potentially obtaining offtake agreements and construction and operation (COP) approvals.
Despite the slow pace of sanctioning in 2024, projects like Red Rock Power and ESB’s 1.1-GW Inch Cape in the UK and Equinor’s 810-MW Empire Wind 1 in the US advanced.
Inch Cape, which formally announced its financial close status in January 2025, secured 15-year contracts for difference (CFD) in both 2022 and 2024, providing revenue certainty and boosting investor confidence.
The UK, Poland and Germany are set to lead a surge in European FIDs in 2025, reaching 9.5 GW, with several projects in these countries on track for final approval.
Poland in particular is expected to see multiple major wind farms reach FID, including Polenergia and Equinor’s Baltyk II and III, following the recent FID for Orsted and PGE’s Baltica 2 in late January 2025.
