OCEAN POWER MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)
The Ocean Power Market is estimated to be valued at USD 1,144.2 Mn in 2024 and is expected to reach USD 3,981.8 Mn by 2031, exhibiting a compound annual growth rate (CAGR) of 19.5% from 2024 to 2031.
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The Ocean Power Market is expected to see significant growth over the forecast period due to increasing focus on developing renewable and clean sources of energy to meet the growing global energy demand in a sustainable manner. The ocean power market is witnessing high growth on account of supportive government policies and regulations that aim to reduce dependence on conventional sources of energy. Moreover, decline in technology costs and increase in investment in grid-connected and offshore renewable projects will also support the growth of ocean power systems across the world. However, high initial installation costs and intermittent availability of ocean power resources pose challenges to the adoption of these systems. Still, continuous technological advancements to harness maximum ocean energy and make these systems more cost-effective are expected to boost the ocean power market growth significantly throughout the forecast period.
Growing awareness about climate change
As the effects of climate change have started to become more visible across the globe in the form of rising sea levels, intensifying natural disasters, changing weather patterns and more, there is a rising awareness among people, organizations, and governments about the urgent need to transition to more climate-friendly and sustainable sources of energy. Studies suggest that many extreme weather events globally in the recent past can be directly attributed to climate change. This has fueled discussions in communities and on a geopolitical stage about the collective responsibility to minimize carbon emissions.
Countries are under growing pressure to set and achieve ambitious emission reduction targets to keep global warming within safe levels. Transitioning to renewable sources of energy is widely recognized as a crucial strategy to decarbonize economies and move towards a low carbon future. Offshore wind and ocean power technologies offer promising solutions that can scale up to meet rising energy demands while helping nations achieve their climate goals. They are variable renewable sources with negligible emissions and space constraints compared to land based wind or solar farms.
The rising visibility of climate impacts is triggering more action from citizens, civil societies and businesses. Various international organizations and research platforms have raised awareness about the oceans' crucial role in moderating climate and weather. There is a growing recognition that protecting marine ecosystems and utilizing offshore renewable technologies can help sustain a livable planet. Initiatives promoting a blue economy are encouraging governments and investors to explore new economic opportunities in ocean industries including offshore wind and wave/tidal energy conversion.
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Advancements in ocean power technologies
Considerable research and private capital has fueled advancements in developing commercially viable ocean power technologies over the past decade. Bidirectional progress has been made across the engineering challenges related to generating energy from sea waves, tides, salinity gradients, and ocean thermal energy conversion. Projects integrating wave or tidal turbines have demonstrated the technical and economic feasibility of harvesting energy from ocean currents and tidal range differences. They have shown promise to operate reliably in the turbulent and corrosive marine environment over years of deployment. Advancements in materials engineering, power take-off and transmission systems as well as mooring and electrical infrastructures have enhanced the robustness, modularity and energy output per device.
Key Takeaways from Analyst:
Coastal regions are showing increasing demand for renewable energy sources to power offshore infrastructure and diversify their energy mix away from fossil fuels. Continued advancements in ocean power technologies such as wave and tidal energy converters are gradually making these solutions cost-competitive with traditional power sources.
A major opportunity exists for ocean power in island nations and territories that rely heavily on imported diesel fuels for electricity generation. Dependable and affordable ocean power can help reduce their energy costs and enhance energy security. The Asia Pacific region, with its numerous coastal nations and islands, is projected to dominate new ocean power capacity additions through 2031 Countries like Australia, Japan, and South Korea are investing heavily in ocean power research, development and deployments.
High initial capital costs remain a major barrier to the widespread commercialization of ocean powerprojects. However, larger and optimized devices coupled with innovations in materials, mooringand foundation design are steadily driving down the costs. Environmental and social concerns related to device array installations need to be addressed carefully through consultation and impact assessments. Seasonal variations in wave and tidal resources also pose engineering challenges that solution providers are working to overcome.
Market Challenges: High initial installation costs
The high upfront capital costs required for installing ocean power technologies is one of the major barriers hindering the growth of the global ocean power market. Setting up the basic infrastructure for harnessing power from waves, tides, salinity gradients and ocean thermal energy conversion (OTEC) requires huge investment. Technologies such as wave energy converters and tidal stream generators involve installing large and complex machines in offshore locations, which comes with substantial costs related to feasibility studies, infrastructure development, transportation, equipment, deployment and commissioning. For example, installing a 1 MW wave energy farm can cost anywhere between US$5-10 million. The payback periods for such investments tend to be 15-20 years. Compared to other renewable technologies like solar and wind, ocean power has relatively higher costs per unit of installed capacity.
Market Opportunities: Development of innovative ocean energy technologies
The development of innovative ocean energy technologies provides a great opportunity in the global ocean power market. Oceans cover over 70% of the Earth's surface and represent a huge reservoir of untapped renewable energy. Technologies capable of harvesting energy from ocean waves, tides, salinity gradients, and ocean temperature differences can play a key role in addressing the growing energy needs of coastal populations in a sustainable manner.
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Insights by type : Vast untapped potential
In terms of type, the wave energy segment is estimated to hold 42.3% share of the market in 2024. Wave energy is the largest segment within the ocean power market due to the abundant availability of this renewable resource across the coastlines. Waves are formed due to the wind blowing over the surface of the sea. As long as we have winds, we will have waves, making it a very reliable source of energy. The global potential for wave power generation has been estimated to be in the range of 1–10 terawatts which is significantly higher than the potential from other ocean power technologies like tidal power.
Various technologies have been developed to harness this vast source of energy from waves such as attenuators, point absorbers, oscillating wave surge converters and others. Several pilot and demonstration wave farms have been set up globally to test these technologies and gather long term performance data. Attenuators have shown promising results in energy absorption from wave conditions of ocean sites with higher wave heights. Given the reliability and huge untapped potential that exists, many nations are investing in research and development of wave energy converters to tap this renewable resource on a commercial scale. Initiatives are being taken to reduce the cost of wave energy through economies of scale, new technology innovations and cross-learning from other renewable industries like wind power.
Insights by application : Rising demand for clean energy
By application, the power generation segment is estimated to hold 32.4% share of the market in 2024, due to rising demand for clean energy. Power generation is the dominant application segment for ocean power driven by the ever increasing demand for clean and sustainable energy sources globally. With depleting fossil fuel reserves and stringent regulations to reduce carbon emissions, many countries are looking to diversify their energy mix through higher integration of renewable sources like solar, wind and ocean power. Ocean power is a stable baseload renewable energy that can complement the intermittent power from other renewables. Various ocean power technologies like wave, tidal stream and tidal range are being utilized to set up power plants that generate grid-connected electricity through the motion of water.
Desalination and water pumping are other key applications that are being enabled by ocean energy systems. However, power generation currently remains the primary focus for technology developers and investors given the huge market potential. Many island nations and coastal cities with proximity to ocean are especially dependent on ocean power to meet their long-term clean energy goals in a reliable and cost-effective manner. Initiatives are being taken by governments worldwide to drive the commercialization of ocean power through regulatory support, financing schemes and partnerships with private players. This is further boosting offshore clean power generation using the untapped power of ocean waves and tides.
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The North America region continues to dominate the global ocean power market owing to the strong presence of major industry players and supporting government policies with an estimated 38.6% share in 2024. The U.S. has emerged as the hub for innovation with new technologies constantly being tested and developed, especially in coastal states like California, Oregon, and Washington. Significant investments are being made in pilot projects and achieving grid parity is a top priority for project developers in the region. With the declining costs of offshore wind, ocean power assets are also becoming economically viable options for utilities and regional governments to meet their renewable energy targets in a cost effective manner.
The Asia Pacific region has been the fastest growing market for ocean power in recent years led primarily by China. With its long coastline and focus on developing indigenous clean technologies, ocean energy solutions present an attractive opportunity. Multiple small scale tidal stream and wave energy projects have been commissioned across various coastal provinces. To encourage further R&D and commercialization, the Chinese government offers attractive fiscal incentives for both local and international companies setting up manufacturing or testing facilities within the country. This has attracted many technology developers from Europe and North America as well. Countries like South Korea, Japan, Taiwan and Philippines have also emerged as important markets supporting demonstration projects through public private partnerships.
Ocean Power Market Report Coverage
| Report Coverage | Details | ||
|---|---|---|---|
| Base Year: | 2023 | Market Size in 2024: | US$ 1,144.2 Mn |
| Historical Data for: | 2019 to 2023 | Forecast Period: | 2024 to 2031 |
| Forecast Period 2024 to 2031 CAGR: | 19.5% | 2031 Value Projection: | US$ 3,981.8 Mn |
| Geographies covered: |
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| Segments covered: |
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| Companies covered: |
AWS Ocean Energy, CalWave, Ocean Harvesting, CorPower Ocean, Applied Technologies Company Ltd., Aqua-Magnetics Inc., Atargis Energy Corporation, Able Technologies L.L.C., Alba tern Ltd, Aquagen Technologies, Aqua-Magnetics Inc, Biopower Systems Pty Ltd., Blue Energy Canada Inc., Carnegie Clean Energy Limited, Minesto AB, Nova Innovation Ltd., Mocean Energy, Andritz Hydro Hammerfest, Ocean Renewable Power Company LLC, and Tenax Energy |
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| Growth Drivers: |
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| Restraints & Challenges: |
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*Definition: The ocean power market refers to the industry and technologies involved in harnessing energy from the world's oceans and seas to generate electricity. This includes various forms of ocean energy.
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About Author
Sakshi Suryawanshi is a Research Consultant with 6 years of extensive experience in market research and consulting. She is proficient in market estimation, competitive analysis, and patent analysis. Sakshi excels in identifying market trends and evaluating competitive landscapes to provide actionable insights that drive strategic decision-making. Her expertise helps businesses navigate complex market dynamics and achieve their objectives effectively.
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