Wind-turbine makers strike it rich in the US
General Electric Co and Vestas Wind Systems A/S, the world's two biggest wind-turbine makers, are reaping benefits from record orders by US utilities racing to add generating capacity even as they face the loss of subsidies.
GE, Vestas and Siemens AG stand to gain although the extension of the production tax credit, due to expire in December, is stalled in Congress. Four years ago, the last time the credit wasn't renewed, orders came to a near standstill. Now, rising natural gas prices and state greenhouse-emission laws are fueling a surge in demand for wind power, which accounts for 30 percent of new generating capacity and may boost GE's wind-turbine sales 25 percent to $6 billion this year.
Xcel Energy Inc, the biggest US provider of wind power, is buying 67 GE turbines for a Minnesota wind farm because the state requires it to get almost a third of its power from non-polluting sources. That will help GE reach operating income margins of 17 percent on wind turbines based on this year's sales, as much as 5 percentage points greater than those of Danish competitor Vestas. Wind is the fastest-growing unit at GE Energy, the world's biggest power-plant equipment maker.
"Customers are giving billions of dollars of orders already because they're afraid they're going to lose their spot in line," John Krenicki, who runs the GE Energy division, said on Mar 5.
Agencies
(China Daily 03/13/2008 page17)
