The Problem of Long-Term Forecasts

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Adam Barber
November 11, 2011
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This content is from our archive. Some formatting or links may be broken.
The Problem of Long-Term Forecasts

Long term growth for wind not so rosy? So it would seem, according to MAKE Consulting.

The Q4 Market Outlook Update, as it’s pithily titled, maintains its prediction for 316GW of installed capacity in the period 2011 – 2016. But in its long term prognosis, the report suggests a contraction in the onshore market as support structures are realigned and ‘bearish’ [just a bit… Ed.] market conditions continue to afflict Southern Europe.

Offshore wind is given a more positive outlook, with above average growth rates and a steady project pipeline leading to a compound annual growth rate of 32% from 2010 -2016.

We’d largely agree with the analysis, although there may be some who suggest that offshore is at risk given changes to the ROC banding review from 2013, and the continuous allegations that the industry will never represent value for money in the UK. Given the commitments made to Round 3, however, and the potential for the industry in Korea, China and the US, the trend is probably largely on the up.

Which leaves us to ponder the short term. MAKE reckon that we’ll see short-term growth in certain markets as developers look to get projects on the ground before financial support alters, or industry runs up against further opposition.

Well, probably. The trouble with these reports is that there’s an awful lot of dwelling on generic forecasts, rather than nailing down the specifics in particular countries or regions. Europe may be suffering a slow down, but indicators from South and Latin America, which saw Acciona invest in Costa Rica last week, the realization in South Africa that coal fired plants are not sustainable in the long term, and renewed momentum in Australia, suggest that there could be fairly large exceptions to the rule.

So do we ever really know? To an extent, yes, but let’s remember wind energy is still driven by capital flows, and these flows can appear from nowhere over night, so perhaps we need to be a bit more guarded before we start to talk ourselves up or down too much.

Long term growth for wind not so rosy? So it would seem, according to MAKE Consulting.

The Q4 Market Outlook Update, as it’s pithily titled, maintains its prediction for 316GW of installed capacity in the period 2011 – 2016. But in its long term prognosis, the report suggests a contraction in the onshore market as support structures are realigned and ‘bearish’ [just a bit… Ed.] market conditions continue to afflict Southern Europe.

Offshore wind is given a more positive outlook, with above average growth rates and a steady project pipeline leading to a compound annual growth rate of 32% from 2010 -2016.

We’d largely agree with the analysis, although there may be some who suggest that offshore is at risk given changes to the ROC banding review from 2013, and the continuous allegations that the industry will never represent value for money in the UK. Given the commitments made to Round 3, however, and the potential for the industry in Korea, China and the US, the trend is probably largely on the up.

Which leaves us to ponder the short term. MAKE reckon that we’ll see short-term growth in certain markets as developers look to get projects on the ground before financial support alters, or industry runs up against further opposition.

Well, probably. The trouble with these reports is that there’s an awful lot of dwelling on generic forecasts, rather than nailing down the specifics in particular countries or regions. Europe may be suffering a slow down, but indicators from South and Latin America, which saw Acciona invest in Costa Rica last week, the realization in South Africa that coal fired plants are not sustainable in the long term, and renewed momentum in Australia, suggest that there could be fairly large exceptions to the rule.

So do we ever really know? To an extent, yes, but let’s remember wind energy is still driven by capital flows, and these flows can appear from nowhere over night, so perhaps we need to be a bit more guarded before we start to talk ourselves up or down too much.

Long term growth for wind not so rosy? So it would seem, according to MAKE Consulting.

The Q4 Market Outlook Update, as it’s pithily titled, maintains its prediction for 316GW of installed capacity in the period 2011 – 2016. But in its long term prognosis, the report suggests a contraction in the onshore market as support structures are realigned and ‘bearish’ [just a bit… Ed.] market conditions continue to afflict Southern Europe.

Offshore wind is given a more positive outlook, with above average growth rates and a steady project pipeline leading to a compound annual growth rate of 32% from 2010 -2016.

We’d largely agree with the analysis, although there may be some who suggest that offshore is at risk given changes to the ROC banding review from 2013, and the continuous allegations that the industry will never represent value for money in the UK. Given the commitments made to Round 3, however, and the potential for the industry in Korea, China and the US, the trend is probably largely on the up.

Which leaves us to ponder the short term. MAKE reckon that we’ll see short-term growth in certain markets as developers look to get projects on the ground before financial support alters, or industry runs up against further opposition.

Well, probably. The trouble with these reports is that there’s an awful lot of dwelling on generic forecasts, rather than nailing down the specifics in particular countries or regions. Europe may be suffering a slow down, but indicators from South and Latin America, which saw Acciona invest in Costa Rica last week, the realization in South Africa that coal fired plants are not sustainable in the long term, and renewed momentum in Australia, suggest that there could be fairly large exceptions to the rule.

So do we ever really know? To an extent, yes, but let’s remember wind energy is still driven by capital flows, and these flows can appear from nowhere over night, so perhaps we need to be a bit more guarded before we start to talk ourselves up or down too much.

Long term growth for wind not so rosy? So it would seem, according to MAKE Consulting.

The Q4 Market Outlook Update, as it’s pithily titled, maintains its prediction for 316GW of installed capacity in the period 2011 – 2016. But in its long term prognosis, the report suggests a contraction in the onshore market as support structures are realigned and ‘bearish’ [just a bit… Ed.] market conditions continue to afflict Southern Europe.

Offshore wind is given a more positive outlook, with above average growth rates and a steady project pipeline leading to a compound annual growth rate of 32% from 2010 -2016.

We’d largely agree with the analysis, although there may be some who suggest that offshore is at risk given changes to the ROC banding review from 2013, and the continuous allegations that the industry will never represent value for money in the UK. Given the commitments made to Round 3, however, and the potential for the industry in Korea, China and the US, the trend is probably largely on the up.

Which leaves us to ponder the short term. MAKE reckon that we’ll see short-term growth in certain markets as developers look to get projects on the ground before financial support alters, or industry runs up against further opposition.

Well, probably. The trouble with these reports is that there’s an awful lot of dwelling on generic forecasts, rather than nailing down the specifics in particular countries or regions. Europe may be suffering a slow down, but indicators from South and Latin America, which saw Acciona invest in Costa Rica last week, the realization in South Africa that coal fired plants are not sustainable in the long term, and renewed momentum in Australia, suggest that there could be fairly large exceptions to the rule.

So do we ever really know? To an extent, yes, but let’s remember wind energy is still driven by capital flows, and these flows can appear from nowhere over night, so perhaps we need to be a bit more guarded before we start to talk ourselves up or down too much.

Long term growth for wind not so rosy? So it would seem, according to MAKE Consulting.

The Q4 Market Outlook Update, as it’s pithily titled, maintains its prediction for 316GW of installed capacity in the period 2011 – 2016. But in its long term prognosis, the report suggests a contraction in the onshore market as support structures are realigned and ‘bearish’ [just a bit… Ed.] market conditions continue to afflict Southern Europe.

Offshore wind is given a more positive outlook, with above average growth rates and a steady project pipeline leading to a compound annual growth rate of 32% from 2010 -2016.

We’d largely agree with the analysis, although there may be some who suggest that offshore is at risk given changes to the ROC banding review from 2013, and the continuous allegations that the industry will never represent value for money in the UK. Given the commitments made to Round 3, however, and the potential for the industry in Korea, China and the US, the trend is probably largely on the up.

Which leaves us to ponder the short term. MAKE reckon that we’ll see short-term growth in certain markets as developers look to get projects on the ground before financial support alters, or industry runs up against further opposition.

Well, probably. The trouble with these reports is that there’s an awful lot of dwelling on generic forecasts, rather than nailing down the specifics in particular countries or regions. Europe may be suffering a slow down, but indicators from South and Latin America, which saw Acciona invest in Costa Rica last week, the realization in South Africa that coal fired plants are not sustainable in the long term, and renewed momentum in Australia, suggest that there could be fairly large exceptions to the rule.

So do we ever really know? To an extent, yes, but let’s remember wind energy is still driven by capital flows, and these flows can appear from nowhere over night, so perhaps we need to be a bit more guarded before we start to talk ourselves up or down too much.

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Become a member of the 6,500-strong A Word About Wind community today, and gain access to our premium content, exclusive lead generation and investment opportunities.