The world’s largest manufacturer of wind turbines, Vestas Wind Systems, announced record first-half orders last week as profits exceeded analyst estimates. European wind turbine manufacturers including Nordex and Gamesa, are riding a surge in orders on the back of government efforts to reign in carbon emissions and favourable policies for clean energy. The final ruling of the US Clean Power Plan, released August 3, “rewards US states for fossil fuel retirements and renewable build occurring after 2012,” and is discussed by Bloomberg New Energy Finance
Gamesa has seen its shares climb 90% this year, followed closely by Vestas and Nordex. Wind projects, among the cheapest form of renewable energy, will jump by a quarter in 2015 to a record 60GW, forecasts BNEF.
Following generous European subsidies to prove its technical viability, the offshore wind industry must now cut costs so that the sector can compete autonomously, according to the research note Route to offshore wind 2020 LCOE target, published by BNEF. “We estimate the current benchmark levelised cost of offshore wind at $176/MWh”, BNEF analysts wrote in the note. The analysts forecast 18.1% cost reductions by 2020, if factors including development costs, operations and maintenance and financing all contribute.
Elsewhere in Europe, MHI Vestas Offshore Wind won a conditional 450 MW turbine order for Dong Energy’s Borkum Riffgrund II project in the seas off Germany.
Wind developers are also showing greater confidence in Brazil – selling six times as much power through an energy auction last Friday as they did in a similar auction in April. This time round, contracts were won to sell power from 538.8 MW of wind farms for an average price of $51.90 per MWh.
Institutions such as the International Finance Corp. and Asia Development Bank are backing wind projects in locations where the industry is more fledgling. These two institutions are backing Indo Wind Power Holdings’ $140m project in Indonesia’s Sulawesi province that will total 63MW. On the African continent, Gulf Energy of Kenya signed an accord with Meru county to build a 100 MW wind plant.