China’s energy market could be badly hit as the coronavirus has halted production on the countries wind turbine installations, according to Wood MacKenzie (WoodMac).
The research firm believe China could see a 10% to 50% decrease in wind turbine installations in 2020.
WoodMac claims that turbine component production has “come to a standstill” in China over the last few weeks.
It adds this is not only bad for the wind market in China, but also the United States where developers are rushing to complete projects by end of the year to remain eligible for government subsidies.
WoodMac senior consultant Xiaoyang Li said: “Due to an already tight supply of key components such as turbine blades and main bearings before the COVID-19 outbreak, first-quarter production delays have already reduced annual output of those components by about 10%.
“Components without pre-existing bottlenecks, such as generators and converters, should be able to recover from Q1 delays if the outbreak is brought under control in the next few months.”
Mr Li also said that the impact of coronavirus on the market could impact other regions.
He said some markets would either have to “lean on their domestic supply chains or imports from other low-cost regions such as India, Vietnam, and Southern Europe.”
Mr Li added: “In a best-case scenario, the epidemic is contained and production resumes by the end of March.
“In a bear-case, the epidemic could continue to impact the supply chain well into the middle of the year.
“Based on these two possibilities, we estimate production delays across the wind turbine supply chain will result in a 10% – 50% decrease in 2020 wind installations in China, compared to our Q4 2019 wind power outlook, which was at 28 gigawatts (GW) capacity.”