Moody’s: Paris Climate Agreement to Boost Wind Turbine Sales

Source: Siemens

Wind turbine makers are set to benefit from the Paris Climate Agreement (COP21) as the call for increased investments to meet a targeted reduction in CO2 emissions is expected to positively impact their sales figures, according to Moody’s Investors Service.

The increased investment, particularly in emerging markets, directed towards renewable energies such as wind and solar energy is likely to increase the sales of major wind turbine makers such as Siemens Aktiengesellschaft , General Electric Company, Vestas, Gamesa, Goldwind, and Senvion TopCo GmbH over the next five to 10 years, Moody’s said.

“It is highly likely that new installations will remain flat on 2015’s record level, as the industry has matured and governments in many developed markets are reducing new installation targets to cut back subsidies and limit costs for end customers,” said Matthias Hellstern, a Moody’s Managing Director — Corporate Finance.

“However, the COP 21 agreement will provide the basis for additional public support and financing in growth regions, which should offset this development in the longer term.”

Momentum has shifted from mature markets in Europe and the US to emerging markets and Moody’s now expects that new equipment growth over the next five years will come from emerging markets such as India, Brazil and, increasingly, Africa.

In 2015 installed capacity of wind turbines in China reached 145.3 GW, surpassing for the first time the European Union’s capacity of 141.6 GW. In 2015 all emerging markets combined accounted for 62% of new equipment orders and COP 21, together with the need for clean energy, should support growth in these markets. Moody’s expects that this trend will continue, as decreasing subsidy schemes and a scarcity of good onshore positions in developed markets will result in slowing demand from Europe and North America.

The European market is likely to experience a contraction of about 5%-10% of sales in 2017-18 as decreasing subsidy schemes, scarcity of good onshore positions and slowing extension of large scale transmission lines result in slower demand. Additionally, the EU Commission released in 2014 its guidance for the design of renewable support schemes, which will determine whether local subsidies for renewable energy comply with EU law. In response, EU member states will start phasing out fixed tariffs, which insulated operators from market risks in the past. This will ultimately lower subsidies and result in reduced new installation activity.

Five of the biggest wind turbine manufacturers are now based in China, up from four in 2014. China’s Goldwind has become the world’s leading producer as measured by new installed capacity. Chinese manufacturers are likely to focus on international expansion as domestic demand is likely to peak this year.

As a result, Western turbine makers will face increased competition from Chinese players, especially in growing markets such as India, Latin America, the Middle East and Africa. This is likely to put additional pressure on the wind energy industry’s profitability, according to Moody’s

Share this article

Follow Offshore Wind

Events>

<< Jan 2017 >>
MTWTFSS
26 27 28 29 30 31 1
2 3 4 5 6 7 8
9 10 11 12 13 14 15
16 17 18 19 20 21 22
23 24 25 26 27 28 29
30 31 1 2 3 4 5

WINDFORCE Baltic Sea 2017

The focus of this two-days event is on the development of offshore wind in the Baltic region…

read more >

Scottish Renewables Offshore Wind Conference, Exhibition & Dinner 2017

The Scottish Renewables Offshore Wind Conference, Exhibition & Dinner, in association with Offshore Renewable Energy Catapult, will explore key issues facing Scotland’s offshore wind planning, as well as discussing innovations and technology development. The conference will also cover cost reduction and infrastructure, concluding with a debate from industry leaders regarding the future of offshore wind in Scotland and the rest of the UK.

More info

read more >

Floating offshore wind 2017

The event will be important for Norwegian policymakers, organisations supporting the offshore wind industry and the industry and supply…

read more >

WindEurope 2017 Annual Offshore Wind Statistics Webinar

WindEurope analysts Andrew Ho and Ariola Mbistrova will discuss the latest developments within the offshore wind industry, outlining…

read more >

Jobs>

Business Manager Renewables

We are looking for an experienced Business Manager Renewables to lead the dedicated Operations team in our Bristol office...

apply

QHSE Officer, Liverpool based

As QHSE Officer you will be providing support and cover for the QHSE Manager in managing the office and vessels with regard to compliance ...

apply

Offshore wind jobs at Shell Netherlands BV

Commercial Lead New Energies, Offshore Wind Operations Lead and Wind Turbine Engineer.

apply

Vessels>