China overtakes UK with world’s largest offshore wind power capacity

China has overtaken the UK as the world's largest operator of installed offshore wind capacity, with oil and gas companies contributing to the offshore wind boom.

Data released by China's National Statistics Administration show that, at the end of June, China had increased utility-scale offshore wind electricity generation capacity to 11.13 gigawatts, rivalling the approximately 10.4GW of installed capacity of the UK at the end of 2020.

This is in addition to the 280.8GW of onshore wind power generation capacity that China today operates, which is also the world’s largest.

Of the total offshore wind capacity, 3.63GW were installed in the first six months of 2021, a significant increase from the 7.5GW of offshore wind capacity that had been installed by the end of last year.

China then ranked third behind the UK and Germany, according to the Global Wind Energy Council.

Norwegian energy consultantcy Rystad Energy said in a recent report that another 11.8GW of offshore wind power capacity would be installed globally this year, with China contributing 63% of the capacity increase.

Led by China National Offshore Oil Corporation (CNOOC), state-owned oil companies are also making headway in their pursuit of offshore wind power development.

With government approval, CNOOC is carrying out initial work to build a 1GW wind project offshore Shantou city in southern China’s Guangdong province.

Chief executive Xu Keqiang said the company would push forward with offshore wind projects "in a steady and cautious manner", adding that it will only increase investment in such schemes if they show potential to generate worthwhile returns.

Last September, the company started operations at its first offshore wind power project in Jiangsu province.

The H2 project has total power generation capacity of 300 megawatts, with 50 4MW units and 17 6MW units. Out of the total, 47 units are installed in shallow waters and the remainder in deep water.

The company has earmarked more than 5% of its annual budget for clean energy projects, equating to between 4.5 billion yuan ($700 million) and 5 billion yuan from this year's capital expenditure budget of between 90 billion and 100 billion yuan.

China’s frenzied pace of offshore wind turbine installations is occurring as the government prepares to end national subsidies for such projects at the end of this year.

With the subsidies set to end, provincial governments in China's coastal areas are rushing to install offshore wind turbines.

Under the current policy, offshore wind projects that have secured approval in 2019 and 2020 have to be commissioned before the end of 2021.

If not, project developers will be deprived of a government subsidy of 0.85 yuan ($0.13) for every kilowatt-hour of electricity generated.

The rapid build-out of China's renewable energy capacity comes as the country targets reaching peak carbon dioxide emissions in 2030 and then carbon-neutrality in 2060.