The great electrification: Can the EU deliver its wind power ambitions?

Wind power now supplies around one-fifth of electricity demand across the EU and UK and is set to play a central role in Europe’s electrification. Further growth is expected in both onshore and offshore wind, but delivery will depend on permitting, grid readiness, supply chains, auction design, financing conditions, and demand growth.

The geopolitical shocks of recent years, including disruptions of fossil fuel markets, have fundamentally altered how EU policymakers and investors assess the energy system. For years, the shift away from fossil fuels was mainly framed as a climate-policy project. Climate ambitions still matter, but the strategic drivers have broadened. Energy security, industrial competitiveness, affordability, and strategic autonomy now shape the way policymakers and investors assess the energy system.

Electricity sits at the center of this transformation. The great electrification means electrifying energy demand wherever technically and economically feasible, while simultaneously expanding the supply side of the electricity system. That requires large-scale investment in renewable generation, grids, flexibility, storage, and electrified end-use technologies in transport, buildings, and industry.

So how does wind energy fit in the EU’s shift toward becoming “an electro continent,” as phrased by EU Commissioner for Energy and Housing Dan Jørgensen? Well, according to BloombergNEF, total installed onshore and offshore wind capacity in 2025 stood at 241GW in the EU and at 273GW when including the UK. In that year, wind produced 465TWh of electricity in the EU, equivalent to 19% of electricity consumption. That production reaches 552TWh, or around 20% of electricity consumption, when the UK is included. This puts wind in broadly the same order of magnitude as nuclear generation in the European power system. Thus, wind energy is one of the key technologies set to carry a large part of the energy transition. In this article, the seventh in our series on the great electrification, we dive into the role that wind energy plays in the great electrification and identify the key drivers and hurdles for further wind capacity buildout.

A success story founded on the convergence of supportive market factors

In the new phase of the energy transition, wind is a test case for whether Europe can translate its high-level electrification ambitions into actual steel in the ground, turbines at sea, functioning grids, and bankable business models. Though wind’s considerable share of EU electricity consumption is already an important achievement, the great electrification requires much more renewable electricity than today’s system provides.

The wind energy sector has grown tremendously because several ingredients came together over time: policy support, a maturing supply chain, technological improvement, falling costs, and access to capital. Onshore wind has led the way and is around ten times larger than the offshore market today on the back of constant growth since its rollout. Installed capacity reached 220GW across the EU by 2025 and 235GW when including the UK (see figure 1). Offshore wind was introduced much later. However, it has become strategically important because of its scale, relatively high load factors, and proximity to coastal demand centers and industrial clusters. In 2025, installed offshore wind capacity amounted to around 21GW in the EU plus 16GW in the UK, which has rapidly picked up on offshore wind (see figure 2).

Onshore wind deployed across Europe, offshore highly concentrated

Onshore and offshore wind also differ in terms of their deployment (see figure 3). Onshore turbines are found all across Europe. Germany, a front-runner in the region, has by far the most installed capacity today, followed by Spain, France, Sweden, Italy, and Poland. Together, these six countries account for almost 80% of installed onshore capacity in the EU. The UK adds another 16GW and is almost comparable to Sweden’s 18GW market.

In contrast, offshore wind deployment is heavily concentrated, with Germany accounting for 45% and the Netherlands, Denmark, Belgium, and France combined accounting for 53% of EU offshore wind capacity. In the region as a whole, the UK is the largest single offshore country, adding around 17GW to the EU’s capacity. This matters because the EU and UK offshore electricity systems are increasingly interconnected and therefore should not be viewed in isolation.

Though fragmented, policies are strongly supportive of wind energy

EU and member state policies shape both the direction and speed of wind energy expansion. The overall policy signal is clear: Wind is and remains a strategic priority for Europe. In this context, the European Wind Power Action Plan (2023) is important, as it recognizes wind power not only as a decarbonization technology but also as an industrial value chain under pressure. Its focus on faster permitting, more predictable pipelines, improved auction design, access to finance, and supply chain resilience reflects this. It is the only policy document that includes pledges for both onshore and offshore wind deployment capacity, but only up to 2026.

Once again, we see differences between onshore and offshore wind in terms of policy. Onshore wind policy is still largely a national story, with no concrete EU target comparable to offshore wind. Individual countries, however, have set ambitious targets and support schemes. In 2024, they also set targets in their National Energy and Climate Plans (NECPs), which show sizable capacity additions are expected in Spain, Germany, and France. According to RaboResearch, the NECPs imply a combined EU ambition of 308GW of onshore wind capacity by 2030 and 371GW by 2040.

Offshore wind has received much more direct policy attention. Since the release of the EU Offshore Wind Strategy in 2020, with its ambition to install 60GW of offshore wind by 2030 and 300GW by 2050, a long tail of strategies, action plans, sea-basin declarations, and updated national ambitions aimed at offshore wind have been published (see figure 4). However, none of the published targets are binding; they’re aspirational.

According to RaboResearch, the 2024 NECPs point to a combined EU offshore wind ambition of around 76GW by 2030 and 170GW by 2040. This is significantly lower than the combined nonbinding targets of 89 to 100GW by 2030 and 238 to 251GW by 2040 presented in the same year. Despite being less ambitious, the NECPs still represent aspirations for significant growth. They also indicate that policy ambition is a moving target rather than one fixed number. In this context, the 2026 Joint Offshore Wind Investment Pact for the North Seas, or “Hamburg Declaration,” adds another layer. This declaration sends a useful market signal with the confirmation of the 2050 ambition of 300GW capacity and the aim for closer cooperation between governments, industry, and transmission system operators.

Meanwhile, floating wind sits somewhere between ambition and support. Recognized as an innovative technology, floating wind is relevant for deeper-water markets, but concrete EU-level support remains limited. The most relevant hooks are the offshore and ocean energy ambitions, RED III’s indicative target for innovative renewable technologies, and the European Commission’s 2025 recommendations to remove regulatory, permitting, and financial barriers.

And in the UK, the government launched its Clean Power Action Plan in 2024, which it updated in 2025 with onshore and offshore targets (see table 1).

The key message is that European wind policy is supportive but fragmented. Onshore relies mainly on national plans. Offshore has the strongest EU and sea-basin policy push, but targets keep shifting. Floating wind is strategically important but still needs more tangible support to move from promise to scale.

Wind sector to grow to 400GW by 2030 and add at least another 100GW by 2040

What, then, would the potential installed onshore and offshore wind capacity be in 2030 and 2040, based on current market size and the policy ambitions described above? If we first zoom in on onshore wind (see figure 5), we find there is consensus that the expected growth path in the EU and UK will reach around 330GW by 2030. RaboResearch concurs with this.[1] Following the same trajectory, onshore capacity could reach just north of 400GW by 2040, in line with policy expectations. This is close to double the 2025 installed capacity.

[1] To draw conclusions on potential and realistic onshore and offshore capacity by 2030 and 2040, RaboResearch made use of several sources. When there was a range of targets, we opted conservatively for the lowest number. The data for installed capacity by 2015, 2020, and 2025 is based on BloombergNEF. To compare expectations for 2030 installed capacity, we included data from both BloombergNEF and WindEurope. The NECP targets refer to RaboResearch's analysis of the cumulative targets in the 2024 NECPs of all EU countries. Wind energy targets not specifically classified as either onshore or offshore were excluded from the data. For the UK, the 2030 number refers to the lower 2030 target of 43GW. For 2040, we used the lower end of the 2035 target (72GW) as a proxy, as the UK has no targets beyond 2035. The category “EU targets” for offshore wind refers to the lowest targets from the 2024 update of the nonbinding offshore targets of member states as required input to the revised Trans-European Networks for Energy (TEN-E) Regulation, equal to 89GW in 2030 and 239GW in 2040.

For offshore wind, the outlook is very different, reflecting offshore’s unique market maturity and dynamics. As mentioned, the ambitions are wide ranging, but for the purposes of this exercise, we chose to use the NECPs and the nonbinding targets, both published in 2024 (see figure 6). Several conclusions can be drawn from these numbers. First of all, expectations vary greatly. Secondly, the UK’s performance will bear a strong impact on future market size given its large size and strong ambitions. Thirdly, due to the many uncertainties impacting offshore wind, the farther we look into the future, the wider the discrepancies between expectations become. And fourthly, RaboResearch considers the various combined policy ambitions for installed capacity in 2030 and 2040 as highly optimistic given the current market conditions and growth trajectory. For 2030, WindEurope’s and BloombergNEF's expectations are aligned around 70GW of capacity, whereas both the NECPs and 2024 targets seem out of reach today for the EU to achieve by then. The same applies to the 2040 target ranges, which imply a doubling or more of installed capacity from 2030 to 2040 from targets already deemed too ambitious by RaboResearch for that year. The offshore wind market will continue to grow, and if the hurdles are successfully addressed, growth can accelerate from the current slower expansion rate. It is, however, doubtful that the EU plus the UK will have more than 300GW of capacity installed by 2040. That is more likely to happen around 2050, a timeline to which both the original offshore wind target from 2020 and the Hamburg Declaration aspire.

The wind market is not a single story

Realizing these ambitions will require more than one approach, as the wind market is not one single story (see table 2). Onshore and offshore wind differ materially in their economics, deployment logic, and constraints. Onshore wind is the more mature and widely deployed technology. It is cheaper and faster to build, but it is constrained by land availability, permitting, spatial planning, and public acceptance. Fixed-bottom offshore wind is much more capital intensive and complex, but it can deliver large volumes of electricity per park and can be better aligned with industrial demand and hydrogen ambitions.

Floating offshore wind adds a third category. Its potential is large, especially in deeper waters such as parts of the Atlantic Ocean and the Mediterranean Sea, but it remains a nascent technology. Costs are still high, the supply chain is immature, and large-scale deployment will take time. For that reason, this article focuses on onshore and fixed-bottom offshore wind.

Geographic conditions shape further deployment

The location of a wind farm is shaped by factors such as electricity demand, policy support, tender design, grid availability, spatial planning, technical constraints, wholesale power prices, and not least how and where the wind is blowing. The latter strongly influences where a wind park will be built and with which technology. In general, wind speeds are stronger at or closer to the sea and further up north. This makes the North Sea and Baltic Sea particularly attractive for offshore wind, especially because of the combination of strong wind resources and relatively shallow waters. The characteristics of the seabed also influence whether fixed-bottom or floating offshore technology is suitable (see figure 7). For onshore wind, the picture is more mixed, with northern Europe and mountainous areas generally having stronger wind conditions. This mainly impacts which locations within a country are most attractive, not if a country is attractive.

In addition to location considerations, project economics must be carefully weighed. Several business models and support mechanisms apply to wind energy developers. As Europe is not one uniform market, national frameworks reflect differing resource capabilities, market structures, and policy priorities. Thus, project economics depend on the country a project is located in and whether it’s onshore or offshore.

Support for onshore wind generally combines competitive tenders with indexed remuneration, often structured as feed-in tariffs, contracts for difference (CfD), or the use of green certificates, also in combination with power purchase agreements (PPAs). This reflects a broader shift away from open-ended subsidies toward mechanisms that aim to lower the cost for taxpayers while still providing investors sufficient revenue visibility. Germany fits squarely in this model: Under the Renewable Energy Sources Act (EEG), onshore wind projects bid in Bundesnetzagentur auctions and are supported through the existing market premium framework. Notably, all 2025 auction rounds were oversubscribed, and awarded prices remained below the regulatory ceiling. Spain also fits in this group, using auctions under the Renewable Energy Economic Regime (REER), which grants long-term fixed-price or sliding-premium-style remuneration designed to preserve market signals while stabilizing project income. Support is given for a guaranteed period of time, typically 12 to 20 years.

A smaller group of countries operate without dedicated support schemes, as they rely on PPAs or merchant sales. Portugal and Denmark are prominent examples, where onshore wind increasingly depends on spot market sales or PPAs.

Offshore wind support has evolved differently. Recently, subsidy-free or near-merchant models appeared feasible in some markets for a short period, sometimes combined with negative bidding (for example, in the Netherlands and Germany). However, the changed cost environment has shown that these models are no longer sustainable. Poorly calibrated auction designs have contributed to unsuccessful tenders, project delays, cancellations, and site-relinquishment discussions (see examples in figure 8). Countries reacted by retracting, postponing, and reviewing their tenders and tender mechanisms. In response, the offshore wind supply chain has called for radical changes in the auction systems, including a call for a coordinated and smooth tender planning across the EU of 10GW annual capacity with two-sided CfDs plus 5GW of annual capacity with merchant risk/PPAs. This plea was a central part of the Hamburg Declaration in January.

Currently, EU countries find themselves in a transition phase in terms of policy support, aiming to address shortcomings and calls from the industry in order to make offshore wind projects more attractive again for investors.

What is working

Investments in the European wind sector have been driven by a maturing supply chain, cost reductions, good access to financing, and supportive policies and subsidies. The European Commission and individual member states maintain firm ambitions to continue to massively expand the wind energy sector across the EU.

For onshore wind, repowering in particular is a tangible opportunity given this segment’s maturity. Older turbines typically have economic lifetimes of 15 to 25 years. As assets age, owners must decide on lifetime extension, decommissioning, or repowering, meaning replacing one turbine with another. WindEurope expects that onshore repowering will account for almost 16GW, or 13%, of onshore additions between now and 2030 and that an additional 74GW of onshore capacity will reach 20 or 30 years of age by 2030 (see figure 9). This creates an opportunity for turbine suppliers and project developers, especially in large first-mover countries such as Germany and Spain. Repowering can also help address land constraints and public-acceptance challenges. Replacing older turbines with fewer, larger, and more efficient machines can increase electricity output at existing sites, where local acceptance may be easier to secure than for entirely new projects. Repowering might also become an attractive future option for offshore wind as the first near-shore sites approach their end of life.

Another opportunity is system integration. The growing list of challenges for renewable energy, from capex and infrastructure constraints to curtailment and negative electricity prices, also strengthens the case for embedding wind projects in broader system solutions. This can include co-location with batteries, solar photovoltaic (PV), floating solar, electrolyzers, or combinations of these. Sharing grid infrastructure can also reduce upfront costs. These structures are still not widespread, especially for offshore wind, but they are likely to become more important as renewables become even more established in markets.

The main challenges

Despite strong fundamentals, wind energy’s potential is increasingly constrained by hindrances to execution. Grid capacity constraints, long connection queues, permitting delays, and slow implementation of policy instruments all slow deployment. Onshore projects can take around four years to obtain the necessary planning and permits. Offshore projects often take much longer. Curtailment is another growing challenge.

Onshore wind faces specific constraints. Securing land is time-consuming, public acceptance remains a challenge, and spatial-planning rules can materially limit deployment. Examples include distance rules such as the 10H rule in Poland and restrictions related to radar or civil and military aviation in France. Some countries are addressing local opposition through compensation, co-ownership, or citizen-participation requirements, but this remains a structural issue.

Offshore wind faces a different set of hurdles. Projects are large, capital intensive, and complex. Economic viability for new projects has come under pressure. The long-standing narrative of continuously declining offshore wind costs has been disrupted by higher interest rates, rising commodity and input costs, supply chain and infrastructure constraints from ports, vessels, cables, transformers, foundations, and skilled labor. As a result, the levelized cost of electricity (LCOE) of offshore wind increased by 50% between 2020 and 2024 to EUR 95/MWh, after it had declined by 70% to EUR 64/MWh between 2015 and 2020. The time lag between auction award and project delivery adds to the pressure. According to a recent post on LinkedIn from an Executive Director at Frontier Economics, the typical time lag in EU countries between a successful CfD bid and commercial operation date (COD) is seven years. Therefore,developers face much greater risks that turbine, cable, foundation, vessel, and supply chain costs will increase before the project is operational, as most project costs are not effectively locked in until close to the COD. This can pose a significant commercial risk. When tender frameworks do not adjust to these conditions, projects struggle. Already, this has led to cancellations, delays, and zero bidding at auctions.

Demand visibility is another issue. Offshore wind is often linked to future industrial electrification and hydrogen production, but these demand sources are developing more slowly than expected. Data centers represent a new opportunity due to their high electricity needs and strong growth. According to RaboResearch, data centers currently account for 2% to 3% of total European electricity consumption, or roughly 60 to 100TWh per year. This is set to rise to around 150 to 170TWh, close to 5% of total projected European electricity demand, which is equivalent to Poland’s yearly electricity consumption. Data centers are also one of the largest offtakers of PPAs in Europe.

The wider policy backdrop matters

Amid these challenges, the broader EU policy landscape has become more interventionist. Policy initiatives increasingly aim to address the structural bottlenecks facing the wind industry: slow permitting, constrained supply chains, skills shortages, and global competition.

Two initiatives are particularly relevant for wind energy. The Net-Zero Industry Act introduced the ambition that 40% of the EU’s annual deployment needs for strategic net-zero technologies, including wind energy, should be manufactured in the EU by 2030. The act also provides options for faster permitting for net-zero strategic projects. The Critical Raw Materials Act aims to diversify access to critical and strategic raw materials, including those used in permanent magnets for wind turbines, by limiting excessive dependency on any single supplier country.

These policy efforts are necessary, but they also add complexity. Ambitions to source content locally, requirements for raw materials, cybersecurity concerns, and defense-related spatial constraints can all support resilience but also raise costs or slow execution if poorly implemented. The challenge is to build resilience without undermining bankability.

Chinese foundations and wind turbines: The elephant in the room

Striking the right balance between bankability and resilience is increasingly challenging when it comes to turbines and foundations. Chinese wind turbines and foundations are becoming harder to ignore. State-supported Chinese competitors are already dominating their home market and increasingly active and price competitive internationally. Their cost advantage over European-produced equipment creates pressure, especially in an environment where project economics are tight.

While the Chinese have made inroads in the onshore market, they have not yet managed to gain a foothold in the offshore segment, aside from some advances in foundations. The pressure is growing as the cost difference increases and Chinese producers seek to establish themselves in Europe. From a purely cost-based perspective, cheaper foundations and turbines could look attractive, particularly for offshore projects struggling with high capex. The solar PV sector provides a clear precedent for a European market that evolved rapidly after shifting to cheaper Chinese equipment. But wind is not solar. Turbines are larger, more integrated into critical infrastructure, and raise questions around cybersecurity, operational control, and industrial strategy. So far, local players have been able to keep turbines out of the offshore market, but Chinese suppliers have had some success with foundations and onshore wind turbines. European policymakers and industry players face a difficult balance. Keeping Chinese turbines out may protect European manufacturing capacity and reduce perceived security risks, but it may also partly contribute to high cost levels and pressure on project economics. Opening the door too widely could lower costs but weaken Europe’s industrial base in a sector considered strategically important. This tension will not disappear anytime soon.

Wind is set to remain central to Europe’s great electrification, and there is no doubt that installed wind energy capacity will continue to grow significantly. But execution, rather than ambition alone, will shape the pattern and speed of growth. In the EU and UK combined, onshore wind capacity could realistically rise from 235GW in 2025 to about 330GW by 2030 and just over 400GW by 2040. Offshore wind in the EU and UK is expected to grow at a slower pace than policymakers have aimed for given the current market reset, with capacity projected to rise from around 37GW in 2025 to roughly 70GW by 2030. That still represents adding twice the UK installed capacity today in the next five years. Installed capacity beyond 2030 is much more complicated to estimate given the particular market situation of offshore wind, but it seems more realistic to assume that the region will approach 300GW closer to 2050 than 2040. Within offshore, fixed-bottom will remain the dominant technology in the outlook period, while floating wind stays strategically relevant but still too nascent to carry the near-term buildout.

If realized, such capacity buildouts would have a major impact on the composition of future electricity sources in Europe, with wind energy to capture a larger share than today.

The direction of growth and actual future market size will depend most on permitting, grid readiness, supply chain capacity, cost inflation, bankable auction designs, and successful demand creation. The latter two points are particularly true for offshore wind. Successful implementation of policies that do not create additional hurdles for the wind power sector is also crucial to speed up the process. In other words, Europe’s wind story is moving from a story of targets and strong ambitions to a story of delivery: The wind resource is there in abundance, the ambitions are strong, the supply chain is ready, but the entire system has to keep pace. In any case, wind energy will continue to play a major role in the great electrification of Europe.