EIB approves funding for Mexico project

The European Investment Bank (EIB) has approved a €78.5 million loan to Spanish energy group Iberdrola, to finance a wind farm in southwest Mexico.

The loan will help to help finance the construction and commissioning of a wind farm that comprises 121 turbines with a total capacity of 103 MW in Santo Domingo Ingenio, Oaxaca. The project will also include the construction of access roads and interconnection with the high-voltage network.

This is the first EIB loan granted in Mexico under the Sustainable Energy and Security of Supply Facility, a €3 billion multi-annual line for financing projects in non-European Union countries that contribute to ensuring a sustainable and secure energy supply.

Gamesa builds fifth wind turbine plant in China

Spanish wind turbine maker Gamesa has set up its fifth manufacturing plant in China in the city of Da’an in the province of Jilin (northwest China), one of the country’s leading wind energy regions.

Two new wind farm projects totalling 4,600 MW of installed capacity are planned for Da’an, the site of the new Gamesa factory.

The factory, scheduled to begin operating in 2011, will manufacture G8X-2.0 MW wind turbines and will have a production capacity of 500 MW per year. With the commencement of the plant’s operations, Gamesa’s total annual wind turbine manufacturing capacity in China will reach 1.5 GW.

The company currently has four manufacturing plants (for blades, generators, and nacelle and gearbox assembly) in the province of Tianjin, which employ 1,000 people. It has a pipeline of wind farm projects totalling 2,400 MW at varying stages of development.

In February, the company launched its operations in India with the setting up of an Indian subsidiary, Gamesa Wind Turbines. The facility, installed for Gamesa G58-850 kW wind turbine, is equipped with an initial production capacity of 200 MW per year.

Nordex’s Q1 revenues dip 35%

German wind turbine maker, Nordex, generated sales of €150.5 million compared with €233.3 million in the same quarter last year.

The 35% decline in business had been expected due to muted order intake in the previous three quarters largely as a result of a shortfall in the project finance provided by banks, said the company.

Order receipts fell 70% to €71.1 million from €234.3 million in the previous year.

However, the company stated that its new business picked up substantially at the beginning of the second quarter, with receipts of new firmly financed orders standing at €94 million in April alone. At the same time, the company secured framework agreements for more than 300 MW.

A weak start to the year led it to scrap the upper end of its sales outlook. However, the company sees orders rising strongly in the second half of 2010, helped by improving project funding.

“We expect significant growth drivers in the second half of the year,” chief executive Thomas Richterich said at the company’s annual news conference, according to Reuters. He added banks were once again able to provide cash for wind parks.

Order books as of April 30 are valued at around €2.3 billion, which was the first increase of total order backlog since the end of 2008, thanks to the stronger order intake as of the beginning of the second quarter.

Of this, firmly financed contracts account for around €500 million. A slight increase in full-year sales for 2010 is possible thanks to the proportionate execution of these contracts and the expected growth in new business in the second half of 2010.

AWEA supports Kerry-Lieberman Bill, Sen. Brown’s tax credit legislation

The American Wind Energy Association (AWEA) has applauded the bill outlined by Senators John Kerry and Joe Lieberman. Their American Power Act, which is designed to reform the nation’s energy economy, aims at cutting global climate change emissions in the U.S. by 17% over the next decade.

Supporting the efforts of Senators Kerry and Lieberman to address climate change in their proposal, AWEA CEO Denise Bode said that the Association looks forward to seeing provisions on renewable energy like a strong Renewable Electricity Standard as well as energy efficiency to create new clean energy jobs. 

“We urge Senate Leadership to move quickly on strong legislation,” said Bode.

The AWEA legislation also welcomed the legislation introduced by U.S. Senator Sherrod Brown to expand the Advanced Energy Manufacturing Tax Credit (48C) programme for renewable energy.

Bode highlighted that the rate of wind turbine manufacturing investment in the U.S. has slowed.

“At the end of the year our industry could be hiring or firing depending on the policies we put in place. We look forward to working with Senator Brown and with Congress on enacting the most effective measures to boost wind turbine manufacturing investment in our country,” said Bode.

Nordex acquires stake in offshore wind project

German turbine manufacturer, Nordex, has acquired a 40% stake in the project company that is building the Arcadis Ost 1 offshore wind farm.

The majority shareholder in the project company is WV Energie AG, a 50% subsidiary of Wintershall AG. The remaining 50% of WV Energie AG are owned by more than 200 German utilities. The transaction is still subject to approval by several bodies, particularly the responsible anti-trust authorities and supervisory boards.

The planned site is located within the 12 nautical mile zone of the German part of the Baltic Sea 17 kilometers North East of the island “Rügen” at a water depth of around 40 meters.

Around 70 turbines with a combined capacity of at least 300 MW will be installed in the preliminary construction phase with a mean wind speed of 9.6 m/s and around 3,600 full load hours, the wind farm is expected to achieve an annual energy yield of over 1,100 gigawatt/hours, according to Nordex.

Construction of the first turbines is planned for 2014. In this connection, the shareholders assume that permits will be awarded in 2011.

Following preliminary test installations in the Baltic Sea, Arcadis Ost 1 will be Nordex’s reference project in the offshore market, according to Nordex CEO Thomas Richerich.

National Grid, Cape Wind ink PPA

International energy delivery company National Grid and Cape Wind, a privately held developer, are to file a contract with the Massachusetts Department of Public Utilities (DPU) wherein National Grid will buy power from the nation's first large-scale, offshore wind farm, which is expected to come online by the end of 2012.

The 15-year deal must still be approved by the DPU.

This development follows the recent decision from U.S. Interior Secretary Ken Salazar to approve the project. The US$1 billion wind farm, however, will have to agree to additional binding measures to minimise the potential adverse impacts of construction and operation of the facility. The company hopes to begin construction of Cape Wind before the end of the year.

In December, Massachusetts Governor Deval Patrick announced that National Grid and Cape Wind had agreed to enter into negotiations.

As per the Power Purchase Agreement (PPA), beginning in 2013, National Grid would purchase 50% of the wind farm’s output including electricity, renewable energy certificates and other potential market attributes for 20.7 cents per kilowatt hour. That price, which assumes existing federal tax incentives, would increase 3.5% per year during the 15-year term of the contract.

Based on its forecasts of what customers will pay for electricity in 2013, National Grid projects this will translate to a total monthly bill increase of US$1.59, roughly 2% month, for a typical residential customer who uses 500 kWh per month.

For its part, National Grid will only be purchasing slightly more than 3% of its total electricity supply from Cape Wind.

The filing includes two contracts. The first, if approved, would enable National Grid to purchase 50% of the output of the wind farm for its customers. The second contract would facilitate the purchase of the remaining 50% by another party or parties.

Crown Estate adds 2GW of offshore wind

The Crown Estate has given the go ahead for expansions to offshore wind farm sites around the coast of England by announcing an additional 2 GW of capacity from the Round 1 and 2 project extensions.

Wind farm developments off the coasts of Suffolk, Kent, Cumbria and another in Liverpool Bay have all been given the green light to expand their area.

Three Round 1 and Round 2 offshore wind farm operators have been selected to extend five sites, creating an additional 1.7 GW. In addition, a further 340 MW has been offered to increase capacity within the current Round 1 and 2 site areas for two other projects. These awards will help to provide a stable flow of construction projects to the offshore wind supply chain in advance of Round 3.

The selected developers are existing Round 1 and 2 operators and will finalise agreements with The Crown Estate soon.

SSE Renewables and RWE Npower Renewables have been given permission to expand their Greater Gabbard project off the coast of Suffolk.

Vattenfall Wind Power has been given approval to extend its Kentish Flats and Thanet projects off the coast of Kent, and Dong Wind UK is set to expand Burbo Bank, near Liverpool, and Walney, Cumbria.

Centrica Renewable Energy has also been permitted to install extra capacity on Race Bank, while Warwick Energy can add to its Dudgeon site capacity - both off the Norfolk coast.

After finalising agreements, developers will commence the statutory consenting process. Each area extension will require a full, new planning application including an Environmental Impact Assessment and a full consultation.

The Crown Estate will only grant a lease allowing construction to start when statutory consents have been obtained from appropriate decision making bodies.

China marketshare elusive for western turbine makers

In 2009, China became the world’s fastest-growing wind energy market, nearly doubling its installed capacity in wind from 12.1 GW to 25.1 GW within a year.

However, western wind turbine manufactures are losing their grip on this explosive market.Wind turbine majors like GE, Vestas Wind Systems  and Siemens are losing marketshare cumulatively in China to local companies such as Sinovel Wind and Xinjiang Goldwind Science & Technology, according to Bloomberg New Energy Finance.

The combined market share for companies such as GE and its European rivals Vestas Wind Systems and Siemens AG fell to 14% last year from 71% in 2005.

In a bid to remain competitive in the Chinese market, foreign companies are introducing newer technology. Siemens expects to open an US$80 million plant this year in Shanghai that can build 3.6 MW turbines - bigger than anything currently manufactured by a Chinese company.

Spanish wind turbine maker Gamesa has set up its fifth manufacturing plant in China in the city of Da’an in the province of Jilin. With the commencement of the plant’s operations, Gamesa’s total annual wind turbine manufacturing capacity in China will reach 1.5 GW.

The report highlighted that Chinese companies have kept costs down by licensing older technology from overseas rivals, including Vestas, Japan’s Mitsubishi and others that sell their own turbines in China.  

And while the Chinese may pay royalties to the foreign firms, those payments don’t even come close to making up for the business the foreign companies are losing in China.

Scottish borders ‘saturated’ with wind development

The Scottish Borders Council (SBC) has drawn up new guidelines for wind farm development in the region amid growing concerns that the number of wind project approvals in the Scottish Borders is disproportionate to the region’s capacity to absorb such developments.

The Scottish Borders approved more wind energy power than any other Scottish authority per 1000 population and the region has Scotland’s second highest amount of wind farm electricity generating capacity, according to 2008 national figures.

The SBC’s guidelines document includes a map highlighting areas that require significant protection, such as Special Areas of Conservation and Sites of Special Scientific Interest, and is now in the public arena for a 12-week consultation period.

Gamesa maintains margins, enhances production capacity   

Spanish turbine manufacturer Gamesa’s net profit fell by 75% to €8 million and its revenues dipped by 43% in the first quarter.

The company’s EBIT margin remained almost flat at 6.2%.

Gamesa’s consolidated revenues in the quarter amounted to €474 million as a result of the weak global macroeconomic and financial situation and regulatory changes in 2009, the slowdown in the industry in Spain, the sharp seasonal fluctuations expected this year, and the company’s focus on aligning production with customer orders and deliveries.

The company obtained 530 MW of firm new orders in the quarter for delivery in 2010 and 2011, up 21% with respect to the same period last year.

For the first quarter ended 31 March, 2010, the company delivered 256 MW and currently has another 671 MW in the final stages of development. Gamesa had a total of 21,444 MW in portfolio at the end of the quarter, including a significant increase in projects with greater visibility (probable and practically certain), which account for 48% of the total. 

A total of 468 MWe were sold in the quarter, down 43% year-on-year. International markets accounted for 80% of those sales, particularly emerging countries such as China (18%) and India (3%, where Gamesa recently commenced operations), as well as Europe (32%), the US (14%) and the rest of the world (13%).  

Firm orders at 31 March 2010 (1,550 MW) already covered 54% of the company’s sales projections for the year, compared with 39% at the beginning of the year.