According to a research note from China Securities Co., Ltd. (ASX: 601066), after Europe's offshore wind sector hits a trough in project FIDs in 2026, equipment tender activity is expected to improve markedly in 2027.
Europe's fixed-bottom offshore wind FID (Final Investment Decision) volume is estimated at approximately 2.6 GW in 2026, while currently identified potential FID projects for 2027 total about 10.58 GW, of which roughly 5-6 GW are high-certainty projects. The UK's AR8 will further supplement the project pipeline.
Because core equipment such as wind turbines, monopiles, and submarine cables is typically procured ahead of FID, UK AR7 and Irish projects are expected to enter a concentrated tender window in 2026H2-2027. On the supply side, Europe's local monopile capacity begins to tighten at around 7 GW of demand, and high-voltage submarine cable core production lines have scheduling extended to 2028-2029.
If Germany's roughly 16 GW of existing projects receive relief and restart, European equipment demand could break through local effective capacity constraints, further amplifying order opportunities for Chinese suppliers. If Germany remains stalled, 2027 will more likely reflect order recovery rather than a full-blown supply-demand crunch.
Key views from China Securities Co., Ltd. are as follows
Judgments on Europe's offshore wind outlook should place greater emphasis on "FID and equipment tenders." Compared with simply observing auction capacity, FID and the preceding equipment procurement progress better reflect actual order momentum over the next 1-2 years, because offshore wind projects still need to go through multiple stages after auction, including permitting, grid connection, revenue mechanisms, supply chain locking, and financing, while core equipment such as monopiles, turbines, and submarine cables is typically tendered ahead of FID.
Europe's offshore wind equipment tenders in 2027 are expected to be significantly better than in 2026
Europe's offshore wind FID remains at a low level in 2026, with a baseline estimate of about 2.6 GW. Currently identified potential FID projects for 2027 total about 10.58 GW, of which roughly 5-6 GW are high-certainty projects, and the UK's AR8 will further supplement the project pipeline. For most potential 2027 FID projects, turbine and foundation suppliers have not yet been finalized, meaning the next 6-12 months remain a concentrated tender window for core equipment. The UK's AR7 fixed-bottom offshore wind awarded about 8.25 GW, of which about 5.16 GW of foundations have not yet publicly announced final awards. Compared with AR6, where a large number of old project orders were released in advance, the space for new equipment orders in 2027 is clearly larger.
Whether Germany's existing projects receive relief is the core variable determining order elasticity in 2027-2028
From 2023 to 2025, Germany cumulatively awarded about 16 GW of projects, but due to the previous no-subsidy/dynamic bidding mechanism, cost pressures, and financing pressures, many projects have not yet reached FID. The WindSeeG reform has entered parliamentary review, and the new mechanism is conducive to improving the economics of future projects, but existing projects still lack a clear relief plan. If some projects are subsequently restarted through exit-and-re-auction or transition mechanisms, it will further raise the scale of equipment tenders in 2027-2028.
Europe's local monopile capacity is estimated to begin tightening at around 7 GW of demand; once German projects restart, Chinese suppliers' order elasticity is expected to be significantly amplified
On the supply side, the note estimates that Europe's local monopile capacity begins to tighten at around 7 GW of demand, and some older production lines have XXL monopile specification limitations for large diameters. High-voltage submarine cable supply is even tighter, with some core manufacturers' scheduling extended to 2028-2029. Therefore, if only UK AR7/AR8 and Irish projects are considered, European demand is already approaching the critical zone of local capacity. If German existing projects are further released, the order opportunities and capacity spillover space for Chinese monopile and submarine cable companies are both expected to increase significantly.
Trade and localization risks are rising marginally, but in the short term they are more likely to manifest as higher entry barriers rather than comprehensive restrictions. Current focus includes NZIA implementation, the October European Council's statements on industrial competitiveness and strategic dependencies, and anti-dumping risks targeting Chinese offshore engineering steel structures/monopiles.
Risk warnings: 1. European offshore wind auctions, CfD, and Germany's WindSeeG and other policy progress may fall short of expectations, potentially affecting project development pace and equipment demand release. 2. FID, permitting, and equipment tender progress for projects in the UK, Germany, and Ireland may be lower than expected, potentially delaying the realization of orders for monopiles, submarine cables, and other products in 2027-2029. 3. If Germany's existing project relief mechanism fails to materialize, short-term German offshore wind order elasticity may be weaker than expected. 4. EU localization, anti-dumping, anti-subsidy, and other trade measures may exceed expectations, potentially weakening the competitiveness of Chinese companies in the European market. 5. Europe's local monopile and submarine cable capacity may expand rapidly; if demand recovery falls short of expectations, price competition could intensify and suppress order spillover. 6. Large fluctuations in steel, copper, freight, and exchange rates may adversely affect the profitability of relevant companies and the execution of overseas projects.
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