Wind turbine prices have dropped 18 percent worldwide in late 2008 and 2009, affected by a decline in demand for the equipment and a decline in the cost of raw materials such as steel, consulting firm New Energy Finance reported on Monday.

Analysts blamed the fall due to a decrease in turbine demand and a lack of financing. They also say a rapidly expanding supply chain has led to an over-supply in the global market.

[The] credit crunch and recession are biting into wind turbine prices in the same way, although to a rather lesser extent, as they are impacting solar module prices, said Michael Liebreich, chairman and CEO of New Energy Finance in a statement.

Lower wind turbine costs in the short term will improve the potential returns for wind project developers - if, and it is a big 'if', they can secure debt finance from the banks, he added.

The report was based on the Wind Turbine Price Index, launched by the consulting firm this week and is based in confidential data provided by 12 turbine buyers, including utilities and independent power producers, project developers and financial investors.