The European Union and the UK are not on track to meet their 2030 offshore wind targets.

At the same time, Chinese wind-turbine manufacturers – who account for more than half of global wind-turbine capacity – are looking to grow their footprint in the European market, where their presence is currently tiny.

To some, the solution seems clear: allowing Chinese manufacturers to invest in Europe could boost competition, alleviate supply chain bottlenecks and lower costs – not to mention bring climate targets within reach.

But the possibility of a growing role for Chinese wind-turbine manufacturers in the European market has sparked heated debate among European policymakers and industry participants.

In 2024, three of China’s top wind-turbine companies accounted for less than 1% of Europe’s installed wind capacity.

But their focus is increasingly shifting to the continent, which some are concerned could hollow out the one clean-energy industry in which Europe is still competitive.

Competition between European and Chinese manufacturers would be “unfair”, according to critics, because the discounts Chinese firms are offering seem to be at least in part due to state subsidies.

In a recent report published by the Oxford Institute for Energy Studies, we explore whether Chinese wind turbine companies are competitive in Europe and the real risks and benefits of Chinese participation in European offshore wind markets.

Our findings build on interviews with policymakers and industry experts, who have been granted anonymity to allow for candid discussion.

Cost advantages are less clear-cut than they appear

China ranks first for many of the global statistics for offshore wind. It has been by far the largest offshore wind market in the world for several years running.

China had 47 gigawatts (GW) of offshore wind installed, as of September 2025, more than all other countries combined. Furthermore, China also dominates several key fields critical to offshore wind globally, ranging from permanent magnets to offshore installation vessels.

This stands in firm contrast to Europe – where offshore development has experienced several years of slow growth – and the US, which faces an almost complete halt in new development under the Trump administration.

As happened before in solar and batteries, China’s offshore wind industry scale-up has brought about stunning declines in installation costs.

However, this cost advantage is not as straightforward as these headline numbers would suggest. Despite the vast difference in capacity cost, the electricity produced by Chinese offshore wind farms is only 30% cheaper.

A key reason for this is the lower overall capacity factor of China’s offshore wind sector, referring to the actual output of windfarms in China, compared to their maximum possible output. This can be partly explained by lower wind speeds at China’s offshore sites, but could also relate to lower performance of Chinese turbines, as well as power transmission issues.

Lower production costs in China also would not necessarily translate to the European market, as Chinese cost advantages would be partly offset by transport costs, as well as higher insurance and financing premiums.

Greater localisation of turbine production could mitigate against some of these premiums, but would be offset by higher input costs in Europe.

Nonetheless, as more European governments add local content requirements, Chinese manufacturers have announced plans to set up European factories for turbine blades and towers, with core components shipped from China.

These factories could also be costlier to finance than those back home if financing for investments also comes from Europe, further reducing the cost advantage enjoyed by China’s domestic offshore-energy infrastructure.

Issues beyond costs and bottlenecks

European offshore wind development plans have faced a number of hurdles, including rising costs, slow permitting processes, inefficient auction designs, lengthy grid connection times and limited availability of parts, port capacity and installation vessels.

The small number of players in Europe’s offshore wind sector is seen as part of the problem, according to our interviews.

Currently, there are only three major wind turbine manufacturers in the European offshore wind market: Vestas, Siemens Gamesa and GE Vernova.

The latter announced in 2024 that it is downsizing its offshore wind business and has not taken new offshore orders, although it remains active in onshore wind projects. This reduces competition and could hinder efforts to bring down the cost of offshore wind projects.

Bottlenecks, inadequate industry capacity and lack of competition cannot in themselves explain the current European predicament. Developers we interviewed also note that offshore wind auctions with price caps and stringent contractual terms, designed with an expectation of falling costs, have also been part of the problem.

When these auctions have failed – as in the UK in 2023 and Germany in 2025 – this led to capacity contraction, higher costs and industry consolidation, which have only made it more difficult to reach policy targets, according to a report by European offshore wind company Ørsted.

Even with improved European auction design, it may take years for Europe’s offshore wind installation numbers to recover. With or without Chinese participation, it will also take time to build domestic manufacturing bases and installation vessels.

Pathways to Chinese involvement

Meanwhile, Chinese developers benefit from a large and growing domestic market in China. At the same time, however, intense competition on price and quality is spurring them to seek opportunities overseas.

Throughout Europe’s supply chain, Chinese components and services are already helping alleviate shortages and bottlenecks.

Still, our report found there are divergent views on whether a greater Chinese presence in Europe’s wind markets represents a threat or an opportunity – or both.

Policymakers are expected to continue to emphasise concerns about technology dependence and cybersecurity risks, leading to more domestic content requirements and increased scrutiny of Chinese deals.

The case of the 300 megawatt (MW) Luxcara project in Germany highlights the difficulties for Chinese market entry. Chinese manufacturer Mingyang was initially selected by the project owner in 2024, but was later replaced by Siemens-Gamesa, reportedly due to concerns about security and political risks.

The recent announcement of a deal between the UK’s Octopus Energy and Mingyang may illustrate an emerging model. According to Octopus, Mingyang will supply the physical equipment, while Octopus will supply the software and manage the turbines.

Mingyang will still need access to operational data to support ongoing maintenance, but this can be provided periodically by Octopus without compromising security, the energy company told us.

Meanwhile, following policy signals such as the EU’s new pricing mechanism for electric vehicle imports from China, it seems likely that policymakers will continue to encourage Chinese players to establish production bases in Europe and to require technology licensing or technology transfer in exchange for market access. This would amount to applying the Chinese industrial development model in Europe.

This could allow for technological learning in Europe. In China, the largest players have deployed advanced automated manufacturing lines, including robotic blade bonding, modular stator assembly and real-time quality monitoring – although this may have implications for job creation, a stated aim in Europe’s clean-energy policy.

Despite pointing to some advantages, our interviews suggest that Chinese participation in Europe’s offshore wind market is not a panacea.

Its low costs are unlikely to be transferrable to the European context. But greater Chinese participation in auctions and in manufacturing, with local content requirements and other guardrails, could help spur competition in Europe.

At the same time, our report suggests that the focus on China distracts from deeper issues. Without a growing domestic market, it may be difficult for European players to reduce manufacturing costs and upgrade production, with or without Chinese partners.

Ultimately, industry participants tell us that the greatest determinant of success in Europe’s offshore wind market will be consistent policy support, rather than a decision to allow – or to block – Chinese participation.

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Experts: Will Chinese wind power help or hinder Europe’s climate goals?