HOUSTON--(BUSINESS WIRE)--United States wind operations and maintenance (O&M) annual spending is expected to increase to more than $7.5 billion by 2030, a 50% increase above 2018 spending, according to a new report by IHS Markit (NYSE:INFO), a world leader in critical information, analytics and solutions.
According to the IHS Markit 2019 Wind Power Plant Benchmarking in North America: Technological Advancements for Operations and Maintenance, the forecasted increase in O&M spending follows the race to leverage a soon-to-expire U.S. federal tax credit for wind energy. The tax credit and technology advancements have driven heavy investment in new wind projects, with 2018 capital spending reaching $12 billion.
IHS Markit forecasts continued momentum in new project development, with 2019-2021 capital spending expected to average $14 billion per year. Following this tax-credit induced surge and the credit expiration that will soon follow, capital spending is expected to slow. The current surge, however, will drive growth in O&M spending during the 2020s. Moreover, the early 2020s will mark a transition in wind industry employment opportunities from construction to O&M jobs.
“Wind operations job growth will be particularly strong in the next decade,” said Michael McNulty, associate at IHS Markit and report author. “We estimate the number of these jobs in North America to increase from about 6,000 today to nearly 9,000 by 2030,” McNulty said.
The overall employment in the wind-power industry is significantly higher. “Opportunities for wind power plant construction jobs may dwindle for a majority of the next decade,” said Max Cohen, associate director of IHS Markit. “However, there will certainly be growth in operations and maintenance positions as well as jobs remaining in segments down the supply chain that are necessary for replacement components and upgrades.”
The new IHS Markit report also highlights variation in regional trends. Texas far outpaced other states and provinces in 2018 wind O&M spending and employment, the report said. The Lone Star State’s 2018 O&M spending reached nearly $1.3 billion, reflecting the fact that it is largest state in terms of wind power. California followed with more than $400 million in 2018 O&M spending.
Looking to the future, however, wind O&M spending and employment growth are expected to be stronger in the Great Plains and upper Midwestern states, such as Iowa, Oklahoma, Kansas, Illinois, Colorado and Minnesota. By 2030, these six states will increase annual O&M spending by $1.3 billion.
The IHS Markit study comprises data from more than 340 wind projects, representing 36,000 megawatts of capacity and more than 20,000 turbines installed in North America. The data represent more than 150,000 turbine-years of operational history from more than 15 turbine original equipment manufacturers, allowing study participants to track projects and turbine performance over time.
To speak with Michael McNulty or Max Cohen, please contact Melissa Manning. For more information on the IHS Markit 2019 Wind Power Plant Benchmarking in North America: Technological Advancements for Operations and Maintenance, contact Beth Foote.
About IHS Markit (www.ihsmarkit.com)
IHS Markit (NYSE: INFO) is a world leader in critical information, analytics and solutions for the major industries and markets that drive economies worldwide. The company delivers next-generation information, analytics and solutions to customers in business, finance and government, improving their operational efficiency and providing deep insights that lead to well-informed, confident decisions. Headquartered in London, IHS Markit has more than 50,000 business and government customers, including 80 percent of the Fortune Global 500 and the world’s leading financial institutions.
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