The US market has seen record multipurpose (MPP) vessel calls in 2020, despite the havoc caused by the global pandemic and trade wars with China and wind energy projects in the country are building momentum in the face of this perfect storm.
[ds_preview]By Michael Morland, General Manager Americas, AAL shipping (AAL)
As we examine our intelligence data, the outlook for wind energy remains positive and is in fact looking at a projected culminative annual growth over the next five years of 4 %.
Studies forecast a total annual investment of $60 billion up to 2028, demonstrating the strong political push towards a greener environment, even in the US where there has been a large noise created around supporting the fossil fuel industry the last four years.
According to Energy Information Administration (EIA) data, wind energy will account for 44 % of new US electricity capacity in 2020.
AAL has improved and invested in its support of local multipurpose, steel, breakbulk, and project cargo shippers in North America by operating monthly sailings (East and West bound) through US ports in 2020 – connecting the region with trading partners in Asia, Europe, and the Middle East. This monthly sailings frequency is part of our firm commitment to US shippers in 2021, as well as the introduction of sailings from Asia to South America.
In 2019, the wind vertical achieved its second-best year for new wind capacity across the globe, with 60.4 gigawatts (GW) of new wind energy being installed (54.2 GW onshore, 6.1 GW offshore) and North America accounted for 16.1% of this global wind power development.
Due to the unexpected supply chain constraints of 2020, a report by Wood Mackenzie states that among the 18 GW of wind energy that is set to come online in 2020, about 15 GW is expected to be commissioned with the rest delayed.
Onshore and offshore windfarms and power generation projects are the drivers for the Americas MPP segment, and in February 2020, as supply chains started being affected by coronavirus, AAL was shipping wind equipment from Asia to the US.
By June 2020, AAL had seen a record presence in the US with 12 MPP sailings calling to West Coast, Gulf, and East Coast ports that were in direct response to an increase in breakbulk demand, primarily for the wind power vertical.
It seems to be the case that the global pandemic has not affected the support politically and nationally for wind energy projects, although the timelines for project completion have been extended.
The mature wind power projects have generally pushed ahead throughout the crisis, whereas less advanced projects have been badly affected facing postponement, or even cancellation, causing potential cargo volumes and rates to fall with them.
Furthermore, the US oil market has not met the 2020 projections of $190 billion and LNG facilities have been hit hard with uncertainties surrounding funding issues by lacking long-term contract purchases.
At AAL, we have invested heavily in our fleet profile and global infrastructure to become one of the leading carriers within the wind energy sector thanks to the healthy growth of global wind energy, and our mega-size MPP vessels, are ideal for serving very long wind towers and blades which smaller MPP vessels simply cannot transport in an economically efficient manner.
In the wake of the developments throughout 2020, we are building on our long- standing commitment to the US market, having serviced the West Coast and East Coast with both scheduled liner and tramp chartering services since 2014.
Our continued investment supporting local multipurpose, breakbulk, and project cargo shippers in North America ensures the operation of monthly sailings that connect the region with global markets and projects.
As we look forward, the AAL team sees great opportunity for competitively servicing project heavy lift, break bulk, and bulk cargoes between both US coasts and long-haul trading partners in the East and West.
