1. Scale and Prospect: carbon emission reduction is imperative. Under the trend of parity of offshore wind power, the future development is still a sea of stars.
Global carbon emissions show a rapid growth trend. Carbon emission reduction action has become a goal set by all countries to promote the development of renewable energy. Wind power, photoelectric power and hydropower can form complementary development. In particular, offshore wind power has the characteristics of rich resources, strong nearby consumption capacity in developed coastal areas, high utilization hours of power generation, no land occupation and suitable for large-scale development. It has great development potential in the future.
Globally, according to GWEC data, the newly installed capacity of global wind power in 2020 will be 93gw, including 86.9gw of land wind and 6.1gw of sea wind, among which the European market is the largest outside China. According to windeurope data, the installed capacity of European offshore wind power in 2020 will only be 2.9gw. Under the background of global carbon emission reduction, it is predicted that the construction of offshore wind power in Europe will accelerate again, By 2025, the new installed capacity will reach 9.2gw. Europe is an early practitioner of wind power construction, and wind power construction will also bring positive economic and social benefits to Europe.
In terms of the Chinese market, worldbank predicts that the total development potential of China's offshore wind power resources will reach 2982gw, with a broad market space. However, China's cumulative installed offshore wind power scale in 2020 will be 9gw, accounting for 3.20% of the total wind power, which is still lower than the global average (4.72%). Under the trend of double carbon target and flat price Internet access, there will be broad growth space in the future. Specifically, the new installed capacity of China's wind power market in 2020 is 71.67gw, with a year-on-year increase of 178%. The cumulative installed capacity in 2020 is 281.53gw, with a year-on-year increase of 34%, maintaining high-speed development. In terms of offshore wind power, China's new installed capacity in 2020 is 3.06gw, a year-on-year increase of 54.5%.
In the short term, the bidding of Haifeng market after the rush loading tide was restarted in the third quarter of 2021. At present, 3gw of the preliminary service of Three Gorges new energy and 1GW of the bidding project of Yuedian have been announced, which exceeded the market expectation after the rush loading tide.
In the medium and long term, the offshore wind power construction planning of all provinces in the 14th Five Year Plan period is expected to exceed 40gw, of which the planned installed capacity of offshore wind power in coastal bases will reach 71 million kW in 2035, with a broad space.
2. Development trend: the trend of parity, large-scale and far-reaching is obvious, and the offshore wind power technology continues to evolve.
① The global sea breeze lcoe continues to decline and gradually develops towards parity. The average lcoe in 2010 was about US $0.162/kwh, which will be reduced to US $0.084/kwh in 2020, of which parity has been achieved in Europe. In China, with: 1) large-scale wind turbines, reduce the cost of kwh power and improve power generation efficiency; 2) Electricity price marketization mechanism; 3) Stripping the power grid access project to reduce capital expenditure; 4) Promote the "3060" goal, support green finance policies and reduce financing costs. We believe that the industrial chain will jointly promote offshore wind power and continuously reduce costs. It is expected that China's offshore wind power is expected to realize parity on the Internet in 2023. Once parity is achieved, the development of offshore wind power is expected to further accelerate.
② Fans will continue to develop towards large-scale. According to GWEC's prediction, the capacity of offshore wind turbine will reach 15-17mw in 2025. The large-scale wind turbine will reduce the cost, improve the requirements of marine operation capacity and the voltage level of submarine cable. At present, leading international and Chinese fan manufacturers have successively launched fan units with capacity greater than 10MW.
③ Go deep into the sea and develop vast wind energy resources. At present, with the gradual development of offshore resources, the project continues to move towards deep and far sea. The offshore distance and water depth are expected to continue to grow in the future, which will also drive the demand for floating fans and the length of submarine cables.
3. Pattern and barrier: the submarine cable pattern is the best, and the submarine cable & Marine barrier is high, and the strong will always be strong.
Submarine cable is the power channel of offshore wind power and an important part of the industrial chain. About 8% - 10% of the cost of offshore wind power is submarine cable cost, of which array cable accounts for about 3%, outgoing cable accounts for about 5% - 10%, and marine engineering is expected to account for about 25%.
In terms of market scale, the submarine cable market has developed steadily. In 2020, the global submarine cable market scale was RMB 11.9 billion, and the compound growth rate from 2016 to 2020 was about 29%. It is estimated that the global submarine cable market will increase from 11.9 billion yuan in 2020 to 57.8 billion yuan in 2025, with a compound growth rate of 37%. China's submarine cable market will increase from 6 billion yuan in 2020 to 25.4 billion yuan in 2025, with a compound growth rate of 33%. We estimate that China's sea breeze cable market is expected to grow from 4.4 billion yuan in 2020 to 20.8 billion yuan in 2025.
Submarine cable competition pattern: the submarine cable industry has industry barriers including technical threshold, geographical location resources, capital threshold and qualification threshold. The competition pattern is stable and highly concentrated. For China, Jiangsu Zhongtian Technology Co.Ltd(600522) , Ningbo Orient Wires & Cables Co.Ltd(603606) and Hengtong Optic-Electric Co.Ltd(600487) occupy the main market share.
In terms of marine engineering, at present, offshore wind power construction ships have become the core rare assets. At present, there are only 42 installation ships in China, which is expected to be difficult to meet the future demand. At the same time, the operation requirements of offshore wind power installation ship are further improved due to the large-scale wind turbine.
Analysis of major leading manufacturers:
① Jiangsu Zhongtian Technology Co.Ltd(600522) : the company has the first market share in the submarine cable field, and its marine business has developed rapidly in recent years. The company has sufficient orders and strong industry competitiveness. The company has built "two types and three ships" to form a whole industry chain service mode from submarine cable to offshore construction, which is expected to fully benefit from China's offshore wind power construction wave in the future.
② Hengtong Optic-Electric Co.Ltd(600487) : Hengtong Optic-Electric Co.Ltd(600487) has undertaken many large-scale offshore wind power projects in China and the world. The offshore floating wind power project in Portugal is the first submarine cable EPC project signed by Chinese manufacturers in Western Europe; In terms of offshore engineering, the company has Huadian Wenqiang + Hengtong No. 1 marine wind power operation platform and Hengtong Lande foundation column construction ship to master scarce resources
③ Ningbo Orient Wires & Cables Co.Ltd(603606) : Ningbo Orient Wires & Cables Co.Ltd(603606) is competitive with Jiangsu Zhongtian Technology Co.Ltd(600522) , and its marine business focuses on providing submarine cable products and laying engineering. Since 2020, the submarine cable business has won a total of 7.07 billion yuan, with a strong development momentum.
Risk tips: the bidding of offshore wind power is not as expected, the development of industry technology is not as expected, the decline of submarine cable price is higher than expected, the rise of upstream raw material price, etc.
