China’s demand for wind turbines slowed down in 2017, partly due to lower subsidies. With the nation’s clean and low-carbon energy strategy settling into place, prospects for the wind power industry look better for 2018.
A report released by Bloomberg New Energy Finance (BNEF) in February showed that global commissioning of onshore wind turbines dropped 12 percent to approximately 47 GW in 2017, partly as a result of slower demand from China. However, a recovery in the Chinese market and continued expansion in Latin America are expected to help new installations grow to 55 GW in 2018.
Newly added capacity totaled about 15 GW in China for 2017, while curtailment rates of wind power dropped 5.2 percent year on year. Following a new high in 2015, China saw drops in installed capacity of wind power projects in both 2016 and 2017. Installed capacity of wind power projects is expected to regain momentum this year, spurred by a combination of factors that include advances in technology, reductions in costs, expected declines in electricity prices, enhanced profitability of power stations, and development of offshore wind power projects, according to an industry insider.
Industry consolidation has become increasingly apparent in the wind power equipment manufacturing industry. The four largest manufacturers of onshore wind turbines — Denmark’s Vestas, Germany’s Siemens Gamesa, China’s Goldwind and U.S.-based GE — supplied 53 percent of the global wind market in 2017. Vestas continued industry leadership, commissioning 7.7 GW of new onshore capacity, a 16 percent share of the global market, while Siemens Gamesa commissioned 6.8 GW of new wind capacity in 2017, a 15 percent market share. Goldwind commissioned 5.4 GW of the new capacity for a share of 11 percent, while GE commissioned 4.9 GW or 10 percent. More than 90 percent of Goldwind’s turbines were commissioned in China, while GE focused on the Americas.
Albert Cheung, head of analysis at BNEF, said: “A round of mergers in the wind turbine manufacturing industry took place in the past few years, including one between Siemens and Gamesa as well as Nordex’s takeover of Acciona Windpower. Considering that there are a large number of small players in addition to the top four makers, further industry consolidation is inevitable.”
China’s top five manufacturers, including Goldwind, commissioned 11.5 GW of new wind capacity in 2017, representing 64 percent of total new installations. The five makers have further increased their already dominant aggregate market share, thanks to advantages in costs, financing, operation and maintenance services. A second round of reshuffling is expected.
Goldwind recently released its financial results for 2017. The company recorded operating revenue of 25.1 billion yuan for the year, down 4.8 percent year on year, while operating profit grew 6.7 percent on a yearly basis to 3.5 billion. Its net profit advanced 1.7 percent from a year prior to 3.1 billion yuan for 2017.
Lead image credit: CC0 Creative Commons | Pixabay