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Article25 Mar 2022

Wind Gains: Energy Independence, Policy Shifts Drive Change

A new report by Citi Research’s Martin Wilkie looks at developments in the wind generation market, and how the drive for energy independence – particularly from Russian gas – impacts the sector.

Higher energy prices and the desire for greater energy independence, especially in the EU, are likely to significantly boost wind energy growth, according to Citi analysts. 

Subject to permit bottlenecks easing in the EU and the passage of the Production Tax Credit in the U.S.the Citi team potentially sees more than 60% upside to Bloomberg New Energy Finance onshore wind forecasts for the 2024-2030 period in the bull case.  Among the factors they cite: 

  • Volume upside: Higher oil and gas prices have raised the cost of fossil power sources relative to renewablesFurthermore, if Europe looks to increase its energy independence and reduce its reliance on gas imports, renewables can provide an alternative power source. 

  • Pricing: High electricity prices can help manufacturers in the wind sector to pass on higher costs. Logistics and difficult-to-hedge raw material costs have plagued the sector since the beginning of 2021, and the increase in steel costs will also need to be passed on 

Citi’s base, bull and bear cases for onshore wind installations ex-China compared to BNEF

Figure 4. Our base, bull and bear cases for onshore wind installations ex-China Source: Citi Research Estimates If you are visually impaired and would like to speak to a Citi representative regarding the details of the graphics in this document, please call USA 1-888-800-5008 (TTY: 711), from outside the US +1-210-677-3788.

© 2022 Citigroup Inc. No redistribution without Citigroup’s written permission.

Source: Citi Research Estimates


The major focus for the market on policy are the U.S. and Europe. The European Union will look to significantly accelerate investments in the renewables space in response to the spike in gas prices and the need to reduce Europe's dependency on Russian gas imports.  

As the main issue with the European market is permitting, the new E.U. plan aims in particular to streamline permitting issues. In the U.S., there remains significant potential for the market to accelerate again if a 10-year extension to the PTC is passed, but until then, uncertainty is likely to prevail 

The full report looks in more detail at Europe and Germany and the U.S. It also examines supply impacts, logistics and the impact of steel prices, among the myriad factors shaping the wind energy market. For more information on this subject, please see European Electrical Equipment - Significant upside in wind energy growth 

Citi Global Insights (CGI) is Citi’s premier non-independent thought leadership curation. It is not investment research; however, it may contain thematic content previously expressed in an Independent Research report. For the full CGI disclosure, click here. 



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