UK: Wind Power Increases Copper Demand

UK: Wind Power Increases Copper Demand

Analysis from Wood Mackenzie’s metal markets and power research teams reveals that a 12% growth in wind power capacity across Western Europe is increasing copper demand, required for component parts of wind turbines and related infrastructure.

Growing pressure from European Union (EU) environmental targets in recent years has resulted in the rapid expansion of wind power installations across the continent and recent analysis from Wood Mackenzie forecasts that this trend is set to continue, boosting copper demand in the process.

 Ian Littlewood, Copper Market Research Analyst for Wood Mackenzie explains: “Recent developments in wind power present a great opportunity for the copper industry in a European market with a relatively flat demand outlook. In 2011 we estimate that 37,000 tonnes of copper was consumed in wind turbines installed in Western Europe, where in total 4 million tonnes of copper was consumed. On average each wind turbine uses 3.6 tonnes of copper per megawatt, which cannot be readily substituted by other materials. We expect wind capacity installations to increase by 12% per annum between 2013 and 2015 and although the corresponding volumes of copper required aren’t significant at this stage, we view this as a bright spot in a gloomy market.”

Wood Mackenzie’s analysis highlights that copper consumption arising from the installation of wind farms is not restricted to copper within the turbines but related power transmission infrastructure as well. This is much harder to quantify but could be as much as is used in the turbines themselves.

Wood Mackenzie says that EU legislation is the key driver behind wind power developments, which has set mandatory targets for European countries to generate twenty percent of their energy from renewable sources by 2020. Germany is currently leading the way in terms of installed wind power capacity with 28.9 gigawatts (GW), closely followed by Spain 22.6 GW; France 7.8 GW; Italy 7.4 GW and the UK 7.1 GW.

Peter Osbaldstone, Senior European Gas & Power Research Analyst for Wood Mackenzie expands: “European member states have made a firm commitment to develop renewable energy supply and incorporate it into the overall energy mix. With legislative pressure from the EU likely to increase as the deadline approaches, wind power is where we see the most growth.

 “Initially the growth in installations was driven by onshore wind projects; however more recently the focus has shifted offshore where larger projects can benefit from higher wind speeds. Wind power currently represents around 12% of total generation capacity in Western Europe, with less than 10% of total wind being offshore, however this looks set to rise to around 20% by 2020 as governments develop vast offshore projects in the pursuit of achieving EU targets. The proportion of wind capacity located offshore will rise to over 25% in that period,” Osbaldstone continues.

The rapid expansion of large-scale offshore wind also presents further opportunity for copper as each project will require dedicated offshore substations which rely on sub-sea copper cabling to transfer power back to the grid. Direct drive or gearless technology is likely to be used in offshore wind turbines, which will also require further volumes of copper.

Littlewood summarises: “We expect that the rapid pace of offshore wind farm developments will translate into copper demand running slightly ahead of our 12% growth forecast for Western European wind power installations: overall a positive picture for the copper industry.”


Offshore WIND staff, August 02, 2012; Image: abb

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