Solar and storage are expected to see an approximate 20% fall from the coronavirus impact compared to the base case scenario, while the impact on onshore and offshore wind is set to be more muted in the near-term, according to global energy consultancy firm Wood Mackenzie's statement late Tuesday.
According to the weekly update by the Wood Mackenzie Energy Transition Practice team, the pandemic is expected to result in a 4.9-gigawatt (GW) decline in 2020 wind additions compared to the previous outlook with India highlighted as an additional downside risk.
Due to coronavirus (COVID-19), the team predicts that technology value chains will have varying levels of exposure to supply side constraints and demand erosion.
According to the update, factory shutdowns and slowdowns will continue across many markets – notably key facilities in India, Spain, Turkey and Mexico. Nonetheless, orders are set to remain robust in the first quarter with Siemens Gamesa announcing new orders last week.
For the offshore wind market, the consultancy forecasts that downside risk is minimal as China restarts, but U.S. projects are still too immature and Europe is already set for a slowdown in installations and contracting.
2020 solar installations have been revised down by 18% from pre-coronavirus levels from 129.5 GW to 106.4 GW.
"2021 will recover to be 3% below pre-coronavirus expected levels. While the utility-scale impact will largely see timelines shift, residential and C&I [commercial and industrial] installations will struggle as customers come under significant economic pressure," according to the update.
Additionally, the update reveals that coronavirus could lower 2020 installations by 20% compared to the 2020 base case, with risks stemming largely from project execution delays.
"The year is still expected to see positive growth over 2019 in both scenarios and return to pre-coronavirus impact levels in 2021. Like solar, the distributed storage risk is more acute," it read.
By Gulsen Cagatay