Australia Wind Turbine Operation and Maintenance Market Size, Share and COVID-19 Impact Analysis, By Type (Scheduled and Unscheduled), By Location (Onshore and Offshore), and Country Forecast, 2022-2029

The Australia wind turbine operation and maintenance market size was valued at USD 471.2 million in 2021. The market is projected to grow from USD 514.5 million in 2022 to USD 903.8 million by 2029, exhibiting a CAGR of 8.38% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with wind turbine operation and maintenance experiencing higher-than-anticipated demand across Australia compared to pre-pandemic levels. Based on our analysis, the market exhibited a growth of 33.3% in 2020 as compared to 2019.  

Wind turbine operation and maintenance processes are pivotal to keep the wind farm in working condition. Several components, blades, generators, and gearboxes, require regular condition monitoring to avoid failure. Without proper maintenance, there is a chance of failure that can affect productivity. Increasing investments in wind energy as an alternative energy resource will positively influence the Australia wind turbine operation and maintenance market growth in the coming years. Wind was Australia's leading source of clean energy in 2020, providing 35.9% of the country's clean energy and 9.9% of Australia's total electricity. This factor led to an increase in demand for wind turbine operation and maintenance services.

COVID-19 IMPACT

Fluctuating Fuel Prices Amid COVID-19 Aided Market Proliferation

COVID-19 spread rapidly everywhere in the world in 2020. Almost every country reported infected cases. From 2020 to 2021, every country was at different stages of the pandemic. The industrial participants witnessed challenges due to lockdowns.

Volatility in the prices of fuels led to an increase in electricity generation from renewables such as wind, solar, and hydro. This shift toward renewables for electricity generation resulted in increased demand for operation and maintenance services. The wind was Australia's leading source of clean energy in 2020, providing 35.9% of the country's clean energy and 9.9% of Australia's total electricity.

Australia's renewable energy market will likely record more than 8% per annum growth by 2025. Significant government investment, rapid acceptance of domestic wind energy, and pressure to meet power demands using renewable energy sources are expected to contribute to market proliferation.

The wind turbine operation and maintenance service providers faced problems such as staff reductions due to COVID-19 protocols. The wind farm operators prioritized staff assignments such as turbine blade operations and repairs. In addition, they delayed repairs that require in-person interactions that would go against social distancing best practices while COVID-19 remains a threat.

The outbreak of COVID-19 occurred when the execution of wind farm projects in the country was at its peak. Australia has an ambitious target of achieving the 174 GW wind energy target. In context, Forest Wind, one of Australia's most significant wind projects having a planned capacity of 1.2 GW, has been delayed by 15 months due to COVID-19. Initially, Forest Wind's installation was due to begin in 2021, but the schedule is now being pushed back to the second half of 2022, and construction is unlikely to start until 2023.

LATEST TRENDS

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 Wind Continued to be Australia's Leading Source of Clean Energy

Wind power is one of Australia's most important renewable energy sources, contributing 10% of the electricity supply in 2020, with 37.5% of the total renewable energy supply. Australia has excellent conditions for generating wind energy. Clean wind resources can be found near residential areas in the country's southern parts and on the slopes of the Great Dividing Range to the east. According to the Clean Energy Australia Report 2021, published by the Clean Energy Council, 7,376 megawatts (MW) of installed wind power capacity at the end of 2020, contributing 9.9% of electricity generation in Australia, and an additional 4,021 MW of capacity committed or under construction. Furthermore, renewable energy development might boost the wind energy sector and consequently the wind turbine operation and maintenance market.

DRIVING FACTORS

Excellent Wind Resources to Stimulate Market Augmentation

 Australia has some of the best wind resources in the world. Australia's wind energy resources are mainly located in the southern parts of the continent and are at their maximum around the Bass Strait. The largest wind resource is generated by the passage of low-pressure areas and associated frontal systems, the northern extent, and influence of which depends on the size of the frontal system. The monsoon and trade wind systems primarily generate winds in north Australia. Large-scale topographies, such as the Great Dividing Range in eastern Australia, exert significant wind steering effects.

Wind is the most robust in western and southern Australia during winter and spring, but monthly behavior varies from region to region. Fluctuations in the average monthly wind speed of up to 15-20% compared to the long-term annual average are not uncommon. Similarly, daily changes with increased wind speeds in the afternoon can occur at individual locations. Additionally, wind resources in the southern part of Australia are reasonable compared to other parts of Australia, so wind farms/mills are increasingly being installed in this part. At the same time, it requires regular maintenance and boosts the Australia wind turbine operation and maintenance market size.

Hornsdale, a wind farm, is a 316.8 MW onshore wind power project located in South Australia. The project is presently active and has been developed in multiple phases. Post-completion of construction, the project got commissioned in July 2016. Furthermore, the project was developed by Megawatt Capital Investments and Neoen. Moreover, the project generates 1,050,000 MWh of electricity and supplies enough clean energy to power 180,000 households, offsetting a year of 1,250,000t of carbon dioxide (CO2) emissions. The project cost was estimated at USD 660 million.

Rising Number of Wind Installations across the Country to Aid Market Expansion

One of the benefits of wind power is its extremely low Greenhouse Gas (GHG) impact, which is estimated to be lower than any other current energy generation technology (with the exception of hydroelectricity). However, while wind energy does not produce any GHG emissions directly, it is responsible for some emissions during the life cycle of wind infrastructures such as using GHG-emitting energy sources to create materials and infrastructure.

The government of Australia has launched a small-scale renewable energy scheme, under which households and small businesses across Australia that install a small-scale renewable energy system (wind, solar) or eligible hot water system may be able to collect a benefit under scheme to aid with the purchase cost. Installing a suitable system enables the creation of Small-scale Technology Certificates (STC) with a value that can be converted by selling or assigning them. The number of STCs created is based on the amount of renewable electricity the system produces or the amount of electricity consumption it reduces. This scheme will increase the installation of wind turbines, and simultaneously the demand for wind turbine operation and maintenance services is likely to increase.  

Moreover, according to the Clean Energy Council, 10 wind farms were commissioned in 2020, adding 1097 MW of new generating capacity, the maximum amount added in the history of the Australian wind industry. At the end of 2020, 21 wind farms with a collective capacity of more than 4 GW were under construction or financially committed nationally.

RESTRAINING FACTORS

Increasing Role of Technology in Wind Energy Might Reduce the Operational & Maintenance (O&M) Cost

Wind farm owners are looking for innovative methods and techniques to reduce operating and maintenance costs, resulting in greater profitability for longer wind turbine operations. Essentially, the industry is looking for data analysis, automation, Artificial Intelligence (AI), and smart technology to ensure effective maintenance of wind turbines with minimal human intervention. Some upcoming O&M trends are drone inspection, automation, and artificial intelligence. Currently, O&M in both onshore and offshore wind turbines is performed manually. With logistics and supply chain accounting for the bulk of O&M costs, minimizing human intervention using robotics, aerial and underwater surveillance drones, and AI are required for increased power generation, cost efficiency, timely maintenance, and longevity of wind turbines.

According to a study of the world's leading wind power experts conducted by Lawrence Berkeley National Laboratory, technological and commercial advances are expected to reduce the cost of wind power further. Berkeley Lab is the U.S. Department of Energy’s National Laboratory Managed by the University of California.

Experts expect cost declines of 17% to 35% by 2035 and 37% to 49% by 2050 under medium or best estimate, propelled by larger and well-organized wind turbines, lower capital & operating costs, and other advances.

Therefore, technological advancements might increase operational efficiency and reduce operating & maintenance costs.

SEGMENTATION

By Type Analysis

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Unscheduled Segment to Lead Backed by Growing Number of Unexpected Events 

Based on type, the market is segmented into scheduled and unscheduled. Scheduled maintenance in the wind turbine operation and maintenance market refers to planned and regular maintenance activities performed on wind turbines to ensure their proper functioning and prolong their lifespan.

Unscheduled maintenance implies unplanned failures of a wind turbine, and unplanned failures lead to lost sales. The consequences and costs of managing component failures can quickly add up. Unscheduled maintenance has harmed turbine manufacturers' profits during the warranty period. Maintenance costs have hit manufacturers and will soon hit owners. Higher-than-expected unscheduled maintenance costs can negatively impact a company's Internal Rate of Return (IRR). The reasons why the unscheduled maintenance segment dominates the wind turbine operation and maintenance market are as follows: 

 Unforeseen equipment failures: Wind turbines are complex mechanical systems subject to wear and tear. Unexpected equipment failures, such as gearbox failures, can occur unexpectedly and require immediate attention.

Weather-related issues: Wind turbines are exposed to the elements and are vulnerable to weather-related problems, such as lightning strikes, high winds, and icing. These issues can cause damage to the turbine and require unscheduled maintenance.

Aging equipment: As wind turbines age, the likelihood of unscheduled maintenance increases. This is due to the need to replace worn-out components and address issues that may not have been present when the turbine was new. Due to the reasons above, the wind turbine operation and maintenance market's unscheduled maintenance segment is expected to dominate. This does not mean that scheduled maintenance is not essential, it just might not be as priority as the unscheduled one.

By Location Analysis

Onshore Segment Holds the Complete Share Due to No Offshore Wind Farms in Australia

Based on location, the market is segmented into onshore and offshore. Onshore wind power refers to energy generated from wind turbines located on land while offshore turbines are located at sea or freshwater. Onshore wind plays a leading role in generating renewable electricity in Australia.

Moreover, onshore wind power has emerged as Australia's most appreciated renewable energy source due to its low cost over offshore. Wind power, coupled with an easy installation process and reduction in Greenhouse Gases (GHG) emissions, is becoming an increasingly popular and cost-effective alternative to traditional fossil fuel-based power generation. Governments are also taking initiatives to install onshore wind turbines to facilitate market proliferation.

In addition, Australia currently has no offshore wind energy. The first official offshore wind zone is off the land coast of the Gipps in Victoria. The government has planned to install up to 200 wind turbines, the closest being 7 kilometers offshore. It would be one of the largest wind farms in the world. Construction could start in 2025.

KEY INDUSTRY PLAYERS

Vestas Holds a Major Share Owing to its Product Offerings and Innovative Technologies

Vestas has a significant market share due to its extensive range of services and substantial brand value. The company mainly invests in developing innovative technologies to make tedious operation and maintenance tasks more accessible and cost-effective. Vestas offers cost-effective wind technologies, products, and services. It also has a knowledge-rich research and development division. Vestas has more than 136 GW of wind turbines in more than 84 countries. The company currently has 117 GW of wind turbines under service. In Australia, more than 5 GW of wind turbines are under service.

LIST OF KEY COMPANIES  PROFILED:

• Vestas (Denmark)


• Siemens Gamesa Renewable Energy S.A. (Spain)


• GE (U.S.)


• Goldwind (China)


• Wind Turbine Services Australia (Australia)


• G&S Abseiling (Australia)


• Australian Wind Services (Australia)


• Worley (Australia)


• Cosmic Group (Australia)


• Professional Wind (Australia)


• Alpha Offshore (Denmark)


• Direct Wind Services (Australia)


• Suzlon Energy Limited (India)


• Rigcom (Australia)


• Ropepro High Access Services (Australia)

KEY INDUSTRY DEVELOPMENTS:

• In September 2022, Vestas Wind Systems, a Danish company, received an order of 104 MW for the Pinta y Guindalera wind farm to be built in Valladolid, Spain. The agreement comprises the supply and installation of 23 V150 4.5 MW wind turbines and a 10-year active output management examination contract. In addition, the project will also benefit from Vestas' strong presence in Spain. The company manufactures V150 blades at its blade factory in Daimiel (Ciudad Real) for both the 4MW and EnVentus platforms. 


• In September 2022, in partnership with Mercury, Vestas secured an order of 43 MW for Kaiwera Downs Wind Farm in New Zealand. The project will feature 10 V136-4.2 MW wind turbines in 4.3 MW operating modes which Vestas will supply and install. Upon achievement, Vestas will supply a 30-year Active Output Management 5000 service & maintenance agreement to optimize energy production, offering Mercury long-term business case certainty for the wind farm.  


• In May 2021, Alpha Offshore was awarded a contract for an aerodynamics campaign with Vestas in Australia at the Collar Wind Farm. The scope of the agreement is to upgrade the turbine blades. The Collar wind farm has 111 turbines, and all the turbines are under blade upgrades; these upgrades will take five months to complete.


• In October 2021, Worley was awarded Operation & Maintenance (O&M) contracts for eight Pacific Hydro wind farms in Victoria, Australia. Under the new agreement, Worley will provide asset management to improve uptime and maximize fleet performance, as well as remote monitoring, operations, and maintenance services for Pacific Hydro's six Victorian wind farms.


• In August 2021, Vestas secured a 181 MW deal for Dulacca Wind Farm in Australia. Vestas will not only deliver the wind turbines but also try to do commission and maintenance. It is looking forward to successfully supporting this project, contributing to the Queensland Government's goal of 50% renewables by 2030.

REPORT COVERAGE

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