The global offshore wind industry is gearing up for a monumental year in 2025, with capacity additions projected to hit a staggering 19 GW and sector-wide investments soaring to $80 billion. After a sluggish 2024, the industry is bouncing back, driven by record-breaking lease auctions and a surge in project approvals. But what’s fueling this resurgence, and what challenges lie ahead? Let’s dive in.
A Record-Breaking Year for Offshore Wind
2025 is shaping up to be a landmark year for offshore wind, with capacity additions expected to surpass the previous peak of 2021 by 1 GW. Mainland China, the world’s largest offshore wind market, is leading the charge, accounting for 65% of new capacity. This growth comes after a disappointing 2024, which saw installations drop to just 8 GW—2 GW lower than 2023.
The rebound is largely fueled by a wave of lease auctions, with 55 GW of offshore wind capacity offered globally in 2024 (excluding China). However, not all of this capacity has been awarded, highlighting the gap between potential and reality. For instance, the US saw no bids for its 3 GW floating wind auction in Oregon, while the Gulf of Maine auction awarded only 7 GW of the 13 GW offered.
Policy Hurdles and Global Ripple Effects
While the outlook for 2025 is optimistic, the industry faces significant headwinds. US federal policy, in particular, is creating global ripple effects. A January 2025 memorandum by President Donald Trump halted new leasing and approvals on the outer continental shelf, citing environmental and safety concerns. This move has paused new developments and cast a shadow of uncertainty over ongoing projects.
“Global offshore wind is set for a robust year in 2025, but policy signals could disrupt its upward trajectory,” says Petra Manuel, Senior Offshore Wind Analyst at Rystad Energy. “The US pause on leasing could have lasting impacts, especially in regions where a large portion of auctioned capacity remains unclaimed.”
Bright Spots and Breakthroughs
Despite the challenges, 2024 wasn’t without its successes. Several high-profile projects reached final investment decisions (FIDs), including the 1.1-GW Inch Cape in the UK and the 810-MW Empire Wind 1 in the US. Inch Cape, which secured 15-year contracts for difference (CFD), has provided much-needed revenue certainty and boosted investor confidence.
Looking ahead, Europe is set to lead the charge in 2025, with the UK, Poland, and Germany expected to approve 9.5 GW of new capacity. Poland, in particular, is emerging as a key player, with major projects like Baltyk II and III on track for FID.
What’s Next for Offshore Wind?
As the industry navigates policy challenges and project delays, 2025 promises to be a pivotal year. With record capacity additions, significant investments, and a renewed focus on sustainability, offshore wind is poised to play a critical role in the global energy transition. But the road ahead is far from smooth—policy clarity and investor confidence will be key to unlocking the industry’s full potential.
