Category: Windturbinen

  • Wind industry: Suzlon declines Vestas takeover offer despite heavy debt burden

    An offer by Vestas for a majority stake in leading Indian wind turbine maker Suzlon ended without agreement, media reported. Apparently, the takeover price was the major problem.

    Vestas´ package was worth close to $1.1bn for a majority stake in Suzlon. Suzlon´s  market cap is just $360m (25bn rupees) today after Suzlon shares falling in Mumbai in the wake of the news.

    Suzlon suffers from a heavy debt burden and is working with lenders to find a solution. Over the past years, the largest Indian wind turbine maker had to stop its high-flying global ambitions due to falling turbine prizes and the abrupt collapse of the Indian market. In 2015 it had to sell its German subsidiary (now: Senvion) and left the US market for some time. Suzlon´s market cap sank from 130bn rupees ($1.9bn) in 2015 to just 25bn rupees.

    Suzlon´s debt stood at 111bn rupees ($1.6bn) in May 2019. It has defaulted on bond payments as early as 2012 and remained in a debt-restructuring program since. It defaulted again in April on a long-term bank facility repayment obligation. Another foreign-currency, convertible bond ($172m) is due in July this year.

    It still has, however, a very strong position in its Indian home market including a strong order book and a 16 GW installed turbine base. This makes the company attractive for Danish turbine giant Vestas who makes another attempt to enter the promising Indian market and to catch up with its global rival Siemens Gamesa.

    Vestas is the leading global onshore wind turbine maker with 10.1 GW of new installations and a global market share of 22% in 2018. The Danish giant is followed by China´s Goldwind (6.7 GW), GE (5.0 GW) and Siemens Gamesa (4.1 GW). The quadriga accounted for 57% of all wind turbines deployed last year.

    Second and third tier manufacturers have difficulties to stem the investment for new turbine generations for onshore and offshore, strong price competition and global marketing and O&M. They also suffer from stop-and-go policies in their home markets, such as Germany and India.

    Further consolidation can be expected. Enercon (Germany), Suzlon (India) and, to some degree, GE (US) and Goldwind (China), mainly rely on their respective home markets but this strategy is under pressure as truly global suppliers like Vestas and Siemens Gamesa are growing faster, have a more diversified portfolio and scale advantages in production.

    Sources and more details:

    https://www.rechargenews.com/wind/1803437/vestas-euro-1bn-suzlon-offer-deadline-passes-with-no-deal-report ($$)

    https://www.bloomberg.com/news/articles/2019-05-08/billionaire-shanghvi-to-keep-suzlon-stake-despite-falling-value

    Image: Courtesy Suzlon India

    Read more on this and on related issues in the next edition of our bi-weekly newsletter Global Energy Briefing (more)

  • The glass ceiling of global clean energy investment – new BNEF numbers cast doubt on market approach

    The glass ceiling of global clean energy investment – new BNEF numbers cast doubt on market approach

    Bloomberg (BNEF) reported today a first estimate on global investment in clean energy in 2018. It dropped 8 per cent to $332.1bn.

    The good news is that falling cost of wind turbines and solar panels somehow blur the impact of this sum. In terms of sectors, only wind and solar attracted more than $10bn : 

    • Wind investment was down 3% to $128.6bn (hereof offshore +14% to $25.7bn) 
    • Solar investment was down 24% to $130.8bn (mainly due to a 53% slump in Chinese investment to $40.4bn) 

    In geographical terms, the downturn was mainly due to China where investment was down 32% to $100.1 billion. That was still enough to keep the top spot, followed by the U.S. (+12%), Japan (-16%), India (-21%) and Germany (-32% to $10.5bn).

    The authors expect another reduction of both costs and overall investment in 2019. This would be bad news for #wind turbine and #PV cell/module makers. 

    The really disappointing news, however, is the stagnation of clean energy investment for nine years in a row, as the chart shows. Since the year 2010, investment has been more or less stagnating. In stark contrast to media headlines and alarming climate phenomena, clean energy apparently has not become more attractive for the investment community. This is all the more true when we subtract China´s investment share.

    In a broader perspective, this casts more doubt on a market-oriented, liberal approach of energy transition, promoted by BNEF (Liebreich) and many other experts.

    Read more on this BNEF report and related news in the next edition of our Global Energy Briefing (German and English version available for subscribers)

    Image shows BNEF chart 

  • Wind Turbines: Vestas – The First Global 100 GW Wind Giant

    Danish wind turbine giant Vestas reached a total installed capacity of 100 GW in late December 2018, according to company press releases. This equals a share of 16.7 percent of the world´s total installations of c. 600 GW wind turbines. Since 1979 the company has installed 66,000 turbines in 80 countries across the globe.

    Order inflow looks promising with a record 12.9 GW in 2018 after 11.2 GW in 2017. The company reinstated its original 2018 cash flow target of €400 million, revoking a profit warning in November. Revenue expectations have remained unchanged at €10-10.5bn. The annual report is due on 7 Feb. 2019.

    Looking forward, Vestas underlined that they will continue the strategic transformation from a pure wind turbine player to a provider of sustainable energy solutions. This would comprise hybrid solutions, storage, grid integration as well as digital and financial services. On the production and installation side, the focus will be on scalability and a modular approach to design, products, installation and integrated solutions.

    Vestas Wind Systems A/S:
    Market cap: 104 bn DKK ($16.1 bn),
    P/E (ttm): 18,3

    Image: Courtesy of Vestas Wind Systems A/S

    Read more on the latest wind industry strategies in the next edition of our Global Energy Briefing (German/English version available)