This is an extract from a recent paper “Strategic Supply Chain Issues & Ireland’s Energy Transition” prepared by the National Economic & Social Council. The extract focuses on the European and global wind technology supply chains, examining issues such as emerging supply chain bottlenecks, concentration risks, sourcing of critical raw materials, changes in EU external trade policy and the potential effects of trade disputes.
Renewable energy technologies involve complex global supply chains. The international supply chain for renewable energy components and finished goods such as wind turbines, solar panels, batteries, electrical interconnectors and electrolysers faces several strategic risks that can potentially impact their deployment, availability and cost. In areas where demand for technological components is high, supply can fall short of demand, potentially impacting upon project delivery timelines, efficient deployment and project costs. The EU lacks sufficient domestic manufacturing capacity for many renewable energy technologies, relying to an increasing degree on imports from locations such as China, India and Southeast Asia. These intra-regional supply chain inter-dependencies create risks for the European supply chain in the event of trade disputes and supply disruptions relating to renewable energy technologies. Trade policy measures such as trade restrictions, tariffs and export controls risk impacting project costs and the successful achievement of Europe’s renewable energy deployment targets and associated timelines.
Emerging bottlenecks in wind technology components and services
Certain wind turbine components and services are at risk of becoming bottlenecks over the coming years as demand ramps-up in the European market. Wind turbine blades are giant composite structures, and their production is highly specialised. A recent WindEurope study identified rotor blade production as a current supply chain bottleneck of concern in Europe. Blade factories are running near maximum capacity and must expand further to meet demand for longer blades, especially in the offshore sector. For offshore turbine models reaching 15 MW, blade lengths can reach 115 metres. Additional expansion of existing facilities and new plants will be needed in the coming years to satisfy both planned European projects and demand in export markets. If sufficient new blade capacity isn’t added, it could delay projects and cap the rate of turbine installations. Tower fabrication has been able to scale within the European supply chain more smoothly but will need to expand further as orders increase.
Demand for towers, particularly large offshore towers, will pick up in the second half of the decade, requiring additional expansion. Analysis by WindEurope suggests the region will reach ~2.5X more tower production capacity in 2025 as compared to output in the early 2020s. A constraint in tower manufacturing is steel plate supply, particularly as European steel mills face higher costs and competition from cheaper Chinese suppliers. A wind turbine nacelle sits at the top of the tower and contains the gearbox, low- and high-speed shafts, generator, and brake. Some nacelles are larger than a house and for a 1.5 MW geared turbine, can weigh more than 4.5 tonnes. There are currently 30 turbine assembly facilities globally producing nacelles for offshore wind, with a further 55 under construction or in planning. Offshore wind turbine nacelles differ from onshore nacelles in several respects due to the distinct environmental conditions they operate in. According to the Global Wind Energy Council (GWEC), global demand is likely to outstrip supply for offshore wind nacelle capacity from the mid-2020s onward in regions other than China.
Offshore wind farms also require complex cabling systems to efficiently transmit power from the turbines to the onshore grid. Inter-array cables connect individual wind turbines within a wind farm, collecting power from each turbine and transmitting it to an offshore substation. Offshore wind farm export cables connect the offshore and onshore substations to transmit power from the wind farm to shore. A key supply chain concern is the gap in vessel installation capacity for cable laying, which could slow down the speed of offshore wind farm installations across Europe. Foundations for offshore turbines are another bottleneck. The preferred foundation type – monopiles – are growing to extreme sizes for 15+ MW turbines. The required scale-up in monopile tonnage is substantial over the 2022-2030 period to meet regional offshore wind development plans in Europe. According to analysis by the Global Wind Energy Council (2024), bottlenecks are projected to emerge in the European supply chain for fixed-bottom foundations from 2026 onwards, and from 2029 onwards for floating offshore foundations.
Global demand for wind turbine installation vessels is projected to grow five-fold by 2030. European projects will face competition from developers in markets such as Vietnam, Taiwan, South Korea and Japan, where demand is expected to grow at rates similar to Europe. Lower demand for vessels in the US market may result in some vessels becoming available for use in other regions, following a pull-back in government support in the US market from 2025 onwards. However, the US market only constitutes a small share of the global fleet and some US vessels are designed specifically for the US market. Specialised port facilities are crucial to the development of offshore wind projects in areas such as logistics, assembly and storage. Ports are where the operation and maintenance of offshore wind farms are run from, where turbines and other equipment are transported to, and where floating turbines are assembled. Timely delivery of specialised offshore wind port infrastructure is essential to ensure vessels and grid connections are ready when turbines arrive for deployment.
Critical raw materials
Modern wind turbines rely on critical raw materials that are in high demand and face multiple supply risks. These include steel, copper, rare earths, nickel, manganese, aluminium, ferrous scrap and glassfibre fabrics. Wind turbines and their foundations are extremely steel-intensive, making up 90% of the materials used in offshore wind turbines. Europe’s steel producers have experienced cost pressures due to high energy costs. European steel prices were ~69% higher in Dec 2022 than in Jan 2019, whereas Chinese steel prices remained largely unchanged over the same period. In April 2024 the European Commission opened an investigation into Chinese suppliers of wind turbines under the Foreign Subsidies Regulation (FSR), suspecting unfair competition. Epoxide resins are another important material in the production of rotor blades and in the coating of wind turbine structures. Epoxide resin prices stood at $3.99 in Europe in February 2025, $3.64 in the US and $1.84 in China.
In 2024, the European Commission initiated anti-dumping proceedings concerning imports of epoxide resins from China. Rare earth elements such as neodymium and dysprosium are used for the manufacturing of permanent magnets used in generators for wind turbines. The European wind technology manufacturing base is heavily reliant on China as a supplier of these rare earth elements. China controls the vast majority of the global rare earth supply, including 80% of the global supply of neodymium. Neodymium prices have been extremely volatile in recent years, rising from $70/kg in 2018 to reach $222/kg in 2022, before eventually falling to $96/kg in 2025. If supply of rare earth elements from China was to be disrupted, severe shortages and price spikes could occur, given limited availability for alternative sources.
In March 2023, the European Commission proposed the Critical Raw Materials Act (CRMA) to bolster the EU’s autonomy in sourcing critical minerals. The Act establishes benchmarks along the strategic raw materials value chain and for the diversification of the EU supplies. These are:
• At least 10% of the EU’s annual consumption for extraction
• At least 40% of the EU’s annual consumption for processing
• At least 25% of the EU’s annual consumption for recycling
• No more than 65% of the EU’s annual consumption from a single third country
EU external trade in wind energy technology
As distinct from other technologies such as solar PV, the international supply chain for wind equipment production is less geographically concentrated, as suppliers prefer to locate production plants close to demand centres due to the high costs and risks associated with transporting large and fragile components over long distances. As a result, the European wind tech supply chain exhibits a significant degree of localisation, encompassing various stages from manufacturing to deployment. The EU is broadly export-oriented for trade in wind turbines but is heavily reliant on imports of solar panels. Almost all (98%) of the EU’s solar panel imports come from China, while 29% of the wind turbines imported into the EU come from China. Chinese suppliers have also recently begun to win contracts for offshore wind projects in Europe.
Europe’s REPowerEU strategy seeks to install 420 GW of wind energy by 2030, implying the addition of at least 30 GW of new generation capacity each year. As a result, European wind turbine manufacturers and service providers now face unprecedented demand growth, with a particular need to invest in new manufacturing capacity to service the offshore wind sector. With much of current expansion geared toward offshore wind, manufacturers are investing in new specialised facilities and scaling up existing lines to handle the latest generation of large-scale offshore turbines. In 2025, European factories are expected to reach production of about 32 GW of turbines per year, comprising 22.5 GW of onshore and 9.5 GW of offshore. WindEurope has forecast that the EU will install 29 GW per annum on average over the 2024-2030 period. This would bring the EU’s total (onshore and offshore) installed wind capacity to 393 GW by 2030, close to the 425 GW needed to deliver on climate and energy targets.
European suppliers have historically held a dominant position both within the European market and as suppliers to global markets other than China. Chinese production heretofore has largely focussed on meeting domestic demand, with market share of just 4.2% in markets outside of China. However, China’s domestic capacity now far exceeds ongoing domestic demand, and Chinese manufacturers are positioned to re-orient towards exporting wind technology to meet growing demand on global markets, including in Europe. Chinese producers already supply onshore wind farm projects in Europe, with approx. 2.6 GW of capacity installed or under development. Due to a focus on serving the domestic market, China makes up 29% of EU wind turbine imports in value terms, with India being by far the largest exporter to the EU market. However, as China pivots towards exporting wind technology, this presents both risks and opportunities for the European wind tech sector. China’s excess capacity has the potential to serve rising demand for wind technology in Europe. Chinese produced wind tech is also highly cost competitive, presenting the opportunity to reduce costs and enhance viability for major wind projects in Europe. However, the sheer extent of China’s excess capacity and cost competitiveness, as well as concerns about unfair trading practices, highlight the risk that the European industry will be undercut by Chinese competition over time.
Trade disputes and trade protectionism
Europe’s wind industry supply chain is increasingly exposed to the risk of emerging trade disputes, trade protectionism and broader geopolitical risks. A key risk for the European wind energy sector is competition from Chinese manufacturers and increased dependency on Chinese component suppliers. If Sino-EU trade in wind technology is disrupted by trade disputes, as has happened in the Solar PV and electric vehicle (EV) sectors, this risks significantly impacting upon the development of the sector in Europe, the cost of components sourced from China, and regional supply chain stability. The experience of the solar PV sector is particularly noteworthy as a cautionary tale, highlighting the risk of unfair competition for the European wind tech sector, as well as the critical importance of the Sino-EU trading relationship. From the early 2000s through much of the 2010s, Europe was a global leader in solar PV manufacturing, with countries like Germany and Italy at the forefront of global module production. At the end of the 2000s, EU countries held about 20% of global production capacity for modules and polysilicon, as well as over 10% for cells. Starting in 2007, the Chinese government implemented policies to support its solar panel manufacturing sector. This included internal electrification projects and export-oriented industrial policy measures, resulting in Chinese manufacturers capturing over 80% of the European market within six years.
Additional trade tensions have recently emerged in the Sino-EU trading relationship in relation to trade in battery Electric Vehicles (EVs). In September 2023, the European Commission launched an antisubsidy investigation into Chinese EV manufacturers. The Commission expressed concerns that substantial state subsidies allowed Chinese producers to sell EVs in the EU at artificially low prices, potentially harming the European automotive industry. Following the conclusion of an investigation in October 2024, the EU imposed countervailing duties on Chinese EV imports. The Chinese Ministry of Commerce responded by placing retaliatory tariffs ranging from 34.8%-39% on imports of European brandy, as well as announcing details of an ongoing anti-dumping investigation into EU pork products and the possibility of imposing duties on imported petrol-powered vehicles from Europe, indicating a broader scope of retaliation. The consistent pattern of trade tensions in the Sino-EU renewable energy technology trading relationship highlights strategic risks for the European wind technology sector.
A key means of supporting supply chain resilience is by fostering collaboration with international partners in government, industry and academia. Such collaboration should aim to identify potential gaps between industry strategies and current advancements in technology, with a view to sharing expertise, overcoming technical hurdles and bridging emergent skills gaps through research, education and training programmes. Strengthening international strategic partnerships can be supported by using diplomatic channels to form MoUs and Intergovernmental Energy Agreements. Such international agreements can cover cooperation in areas such as technological research and development, port infrastructure, developing supply chain corridors and investment in manufacturing facilities.
Conclusion
European and global wind energy supply chains are increasingly characterised by strategic dependencies and emerging bottlenecks. China is an increasingly important actor in terms of global wind turbine manufacturing, and the EU faces critical choices regarding how to manage its growing reliance on Chinese imports while protecting the viability of its domestic manufacturing base. These decisions carry significant implications for the stability, competitiveness, and long-term resilience of the European wind energy sector.
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