Fewer wind turbines will be installed this year, in a delayed reaction to the collapse in investment caused by the financial crisis.
Total onshore and offshore wind installations are expected to reach 37.7GW by the end of 2010, down 2% on 2009, according to analysts at Bloomberg New Energy Finance (BNEF).
This is despite a 25% increase in turbine installations in China from 2009 levels, when the country added 14MW of wind power capacity. One in every two wind turbines going online in 2010 will be located in China, BNEF said.
“Installation levels always lag financings, so what we are seeing this year is the effect of the collapse in investment activity at the end of 2008, beginning of 2009,” said Michael Liebreich, CEO of BNEF, noting the global rate of turbine installation has been held back by the US and Europe, while Asia has surged ahead.
This week, Danish turbine manufacturer Vestas announced it is to lay off around 3,000 workers and close some of its factories in Northern Europe.
BNEF is predicting that global wind installation rates will bounce back in 2011, to reach 45GW, although the analysis firm said that much of this growth will come from “non-traditional markets” in Asia and Latin America.
Europe is expected to see a growth spurt in offshore wind power, however, with offshore installations slated to more than double to 3.3GW a year by 2013. Europe will account for 80% of these installations. Three manufacturers – Siemens, Gamesa and GE – have confirmed plans to build offshore wind facilities in the UK this month, as a ports fund meant to support the offshore wind industry was spared in government cuts.
In its third-quarter results this week, Vestas indicated a less optimistic all-round outlook for European wind. “At the beginning of 2010, Vestas resolved to retain substantial excess capacity in Europe in expectation of an increased demand in 2010 and 2011. In 2011, the European market growth will, however, not live up to Vestas’ expectations, which is why Vestas is compelled to adjust its capacity in Europe,” the firm said.
The firm shipped 719 turbines in the third quarter, down 27% on the same period in 2009, with a post-tax profit of €126 million ($175 million), compared with €165 million this time last year. For 2010, the Danish turbine maker is expecting total orders of 8-9GW, reducing to 7-8GW in 2011.
This week also saw a 25-year-old Skykon, a Danish firm which makes wind turbine towers, file for insolvency. Explaining the decision, Skykon’s chief executive Jens Pedersen said: “The wind turbine industry is project based and very cyclical, and it is currently being affected by a number of negative factors in the wake of the financial crisis. These effects have also impacted Skykon to the effect that we are in a very cash-strapped situation.”
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By. Jess McCabe
Source: Environmental-Finance
