Australia Small Wind Turbine Market

Market Overview

The Australian small wind turbine market size was valued at USD 9,122.9 thousand in 2023 and is projected to reach a value of USD 24,375.1 thousand by 2032, registering a CAGR of 11.5% during the forecast period (2024-2032).

Australia's vast and diverse geography, which includes significant wind resources in locations such as Tasmania, South Australia, and Western Australia, presents significant opportunities for small wind turbine installations. These turbines are increasingly used to provide dependable, renewable energy solutions for farms, distant villages, and private houses. Wind power generated 13.4% of Australia's total energy in 2023, up from 12.8% in 2022. In 2023, combined small- and large-scale renewable capacity reached 5.9 GW, nearly equal to the previous record of 6.3 GW achieved in 2021. Australia also intends to build offshore wind capabilities with the passage of the federal Offshore Electricity Infrastructure Bill in late 2023. This trend is bolstered by government incentives and regulations encouraging distributed renewable energy production.

Market Dynamics

Australia Small Wind Turbine Market Drivers:

Increasing Energy Costs

Rising electricity rates in Australia are driving the development of small wind turbines as individuals and companies seek alternative, cost-effective energy alternatives. High energy costs impact homes and businesses, especially in rural and distant places where electricity delivery can be considerably more expensive due to transmission and distribution issues. Small wind turbines provide a sustainable solution to these costs by providing local, renewable electricity.

According to the Australian Energy Market Commission (AEMC), power prices are continuously rising. Electricity customers in the Northern Territory, Tasmania, and New South Wales will face higher bills. The most significant increase will occur in the Northern Territory, where households will pay USD 116 more per year on average, and small enterprises will spend USD 332 more. Small wind turbines have the potential to lower electricity bills by 50% to 90%. As the rural grid electricity is expensive, the initial investment in a small wind turbine can be recouped quickly. Furthermore, the Australian government has a small-scale renewable energy program that can assist individuals and companies with the cost of building wind turbines.

Australia Small Wind Turbine Market Restraints:

Inconsistency in Wind Pattern and Intermittent Nature of Winds

Coastal places in Australia, such as Tasmania and parts of South Australia, typically enjoy better wind conditions, with higher and more consistent wind speeds. In contrast, inland places such as the central parts of New South Wales and Queensland have significantly lower average wind speeds. Wind speeds in these places frequently fall below 3 meters per second (m/s), which needs to be improved for the efficient functioning of tiny wind turbines, which generally require average wind speeds of 4-5 m/s for best performance.

Additionally, wind speeds in Australia vary greatly and are influenced by factors such as pressure patterns, geography, and the time of day. Instead of simple averages, frequency analyses, such as wind roses, are commonly used to study wind. As a result, in less favorable inland areas, the capacity factor may fall below 15%, making these installations less economically viable.

Australia Small Wind Turbine Market Opportunity:

Off-grid and Remote Application

Off-grid and rural places in Australia provide substantial prospects for modest wind turbine installation. These areas frequently encounter issues relating to energy supply, reliability, and the high costs associated with standard diesel generators. Small wind turbines can offer a sustainable, dependable, and cost-effective alternative, lowering reliance on fossil fuels and improving energy security.

Furthermore, remote towns like those in Western Australia make a compelling case for using tiny wind turbines. In Western Australia, the federal government has proposed an offshore wind zone near Bunbury to support up to 20GW of projects. A Newcastle-based business will lead a new project to repower telecommunication towers with modest wind turbines. Ten miniature wind turbines will be put at ten isolated Australian communication locations as part of a new experiment to increase the adoption of the technology.

Regional Analysis

Australia's wide and diverse geography, which includes significant wind resources in locations such as Tasmania, South Australia, and Western Australia, presents significant opportunities for small wind turbine installations. Small wind turbines provide a renewable energy source that can drastically reduce our dependency on fossil fuels. The Australian Renewable Energy Agency (ARENA) has supported 663 wind energy projects totaling USD 2.25 billion. While small wind turbines make up a smaller share, they are essential in decentralizing energy generation and lowering emissions in off-grid locations.

Additionally, Senvion has deployed 215 wind turbines from its 2MW series across Australia, but the Coober Pedy project will be the company's first off-grid project. The wind energy project, which has been in the works since 2014, is being built by Queensland-based Energy Developments (EDL) with an Australian Renewable Energy Agency grant of USD 18.4 million. Wind energy has the potential to help significantly remote communities and businesses reduce their reliance on expensive fuels.

Furthermore, the Australian government's Small-scale Renewable Energy Scheme (SRES) offers financial incentives for installing small wind turbines, making them more inexpensive and encouraging widespread adoption. The Australian Renewable Energy Agency (ARENA) has supported 663 wind energy projects totaling USD 2.25 billion. In addition, measures such as feed-in tariffs and expedited permitting processes help to drive industry expansion.

Segmental Analysis

The Australian small wind turbine market is segmented based on axis type, grid type, component, hybrid system, power, and application.

The market is further segmented by axis type into Horizontal and vertical Axes.

Horizontal axis models dominate the small wind turbine industry and is anticipated to experience a CAGR of 11.9%. Horizontal Axis Wind Turbines (HAWT) are the predominant form of wind turbine, characterized by blades that rotate horizontally around a central axis. This design, resembling traditional windmills, effectively transforms wind energy into electrical power. High-altitude wind turbines (HAWTs) are commonly constructed on tall structures to harness the more powerful winds at greater heights, leading to enhanced electricity production due to reliable wind patterns.

Based on grid type, the market is fragmented into Off-Grid and On-Grid.

The on-grid category dominates the small wind turbine market with a CAGR of 12.7% over the forecast period. This segment's significance is driven by several converging causes, the most notable of which is the increased emphasis on decarbonization and the move to cleaner, more sustainable energy systems. Small wind turbines incorporated with on-grid systems provide a versatile alternative for supplementing traditional grid electricity with renewable energy, reducing dependency on fossil fuels and lowering greenhouse gas emissions.

The market is sub-segmented based on components such as aerogenerators, solar photovoltaic panels, battery banks, charge controllers, and inverters.

Aerogenerators hold a significant portion of the market with an estimated CAGR of 11.5%. Aerogenerators are the primary and valuable component of the system, responsible for capturing and converting energy. Their capacity to rapidly transform wind energy directly affects the total energy production of the system. The aerogenerator has been leading in the small wind turbine market because it has significantly contributed to energy production.

The market is divided based on hybrid systems into Wind-Solar Photovoltaic (PV), Wind-Diesel, Wind-Fuel Cell, and Wind-Hydro.

The wind-solar photovoltaic (PV) sector has the most significant market share and is expected to develop at a CAGR of 12.6%. Wind-solar PV hybrid systems combine wind turbines with solar panels to generate electricity from both sources. This hybrid system takes advantage of the synergistic interaction between wind and solar energy, using solar panels to create electricity during the day and wind turbines to provide power at night and during cloudy weather.

Based on power, the market is classified into Up to 5kW, 6kW-10kW, 11kW-20kW, and 21kW-50kW.

The "Up to 5kW" category dominates the small wind turbine industry and is predicted to expand at a CAGR of 12.2% over the indicated period. Small wind turbines with power outputs of up to 5 kW are widely employed in home and small-scale applications. Turbines create electricity for homes, cabins, and small farms. They are trendy in rural and remote areas with limited or no electrical grid connectivity.

The market can be bifurcated by application into residential, commercial, agricultural, industrial, construction, infrastructure, telecommunication, government, and military.

Agriculture is the most significant sector, expanding at a CAGR of 12.2% over the predicted period. The segment's growth can be ascribed to its unique energy requirements and wind power's inherent fit for agricultural uses. Small wind turbines are commonly used in agriculture to power irrigation water pumping systems. Many agricultural organizations use irrigation systems to maintain consistent crop yields, particularly in places with uncertain precipitation patterns.

Recent Developments

• April 2024- Alinta Energy and JERA Nex agreed to collaborate on developing a 1 GW+ offshore wind farm in the Southern Ocean Region Declared Area of South West Victoria. The wind farm will be built off Victoria's south-west coast and will use up to 100% renewable energy to power the Portland Aluminium Smelter.
• December 2023- Vestas won a 254-MW order to power an unidentified wind project in Australia. The purchase includes 41 V162-6.2 MW wind turbines from the EnVentus platform.