Overview of Investment and Financing in the European Wind Power Industry in 2018

Overview of Investment and Financing in the European Wind Power Industry in 2018.

1、 Overall situation

In 2018, the financing scale of the European wind power industry reached 65 billion euros (approximately 503.1 billion yuan), an increase of 26% compared to the previous year. Among them, the financing scale of new assets is the largest, reaching 26.7 billion euros, 20% higher than in 2017. Although this scale is close to the data from 2015 and 2016, the corresponding installed capacity is much larger, mainly due to the cost reduction of wind power, especially offshore wind power, and the maturity of the industry.

Project mergers and acquisitions are the main driving force for the overall growth of investment in the European wind power industry, with corresponding funds reaching 18.9 billion euros, compared to only 4.3 billion euros and 9.1 billion euros in 2016 and 2017, respectively.

In the whole year, the scale of corporate M&A financing was 5.2 billion euros, basically the same as that in 2017, continuing the trend of increasing concentration ratio of the supply chain market in previous years. The continuous improvement of industrial maturity and technological competitiveness has attracted more and more investors from industries such as financial services to enter and become project equity holders. These partners are crucial for power generators and developers, who need to recover capital to finance new assets.

Enterprises continue to utilize the low interest rate environment and the liquidity of the financial market to raise funds in the capital market. However, in 2018, European wind power companies only raised 3 billion euros in public capital markets, less than half of the amount in 2017.

2、 New asset financing

In 2018, a total of 16.7GW of new wind power installations in Europe reached the Final Investment Decision (FID), an increase of 45% from the previous year and a historic high. These installations come from 190 onshore and offshore wind power projects in 22 countries.

From a financial perspective, the investment scale of new wind power projects in Europe increased by 20% year-on-year in 2018, reaching 26.7 billion euros. With the maturity of the industry and the promotion of competitive auctions, the cost of the wind power industry continues to decline, allowing unit euro capital investment to finance more new installations.

Throughout the year, the investment scale of newly added onshore wind power projects that reached the final investment decision reached a new historical high, continuing the overall trend of continuous growth in similar investment scale since 2011. Since 2015, the capital expenditure per megawatt of newly installed onshore wind power has been continuously decreasing, but slower than offshore wind power. In 2018, the new onshore wind power installed capacity that received financing also reached a record level.