• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 1 day GREEN NEW DEAL = BLIZZARD OF LIES
  • 3 days "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
  • 8 days America should go after China but it should be done in a wise way.
  • 1 day Even Shell Agrees with Climate Change!
  • 3 days How Far Have We Really Gotten With Alternative Energy
  • 4 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 3 days World could get rid of Putin and Russia but nobody is bold enough
  • 6 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in

Wind Power Giants Warn of Another Challenging Year Ahead

Orsted, Siemens Energy, and Vestas – the three biggest wind power developers and turbine makers in the world – warned that last year’s challenges in the industry would continue this year and suspended dividends as they look to return to profitability and reduce costs.

The wind industry, especially offshore wind, was plagued in 2023 by cost increases, rising interest rates, quality issues with turbines, and delays and cancelation of projects. The new year will not fix all those challenges immediately, the three companies say, still expecting losses and uncertainty in 2024.

Orsted, the biggest offshore wind project developer in the world, is pausing dividends for the financial years 2023 through 2025, aiming to reinstate dividends from 2026.

Orsted booked a net loss of $3 billion (20.2 billion Danish crowns) for 2023, as its financial results were adversely affected by the impairments it took on its U.S. offshore projects.

As a result of the sector challenges, apart from pausing dividends, Orsted will cut its fixed costs, including by a reduction of 600-800 positions globally. Not all of these will be redundancies, but “there will be redundancies throughout 2024,” the company said.

Ørsted is also exiting several offshore markets, including Norway, Spain, and Portugal, deprioritizing development activities in Japan, and planning for a leaner development within floating offshore wind and P2X.

“In order to improve our competitiveness, ensure value creation, and ensure our ability to attract capital to the renewable build-out, we will make Ørsted a leaner and more efficient company,” CEO Mads Nipper said.

Vestas, also of Denmark, the world’s top wind turbine maker, will not pay dividends to shareholders in 2024, either.

“Our performance in 2023 was helped by the improving business environment, but continued geopolitical volatility as well as slow permitting and insufficient grid build-out across markets are expected to cause uncertainty in 2024,” said Henrik Andersen, Group President and CEO.

Siemens Energy, for its part, expects its wind turbine-making unit, Siemens Gamesa, to post a loss of $2.16 billion (2 billion euros) for 2024.

ADVERTISEMENT

For 2023, Siemens Energy’s free cash flow pre-tax was negative, “primarily due to Siemens Gamesa, which suffered a high cash outflow due to a loss and a build-up of operating net working capital in a seasonal weak quarter.”

“Our focus remains on solving the quality problems in our onshore wind business and making the most of the growth potential for the rest of the company,” said Christian Bruch, president and CEO of Siemens Energy AG.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News