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INTERVIEW: GE Germany RE boss
The German onshore wind turbine market is a hard nut to crack, GE admits, with local matador Enercon taking more than half of sales there – and European competitors Vestas, REpower and Nordex pretty much dividing up the rest.
But the American industrial giant two years ago decided to change that, identifying Germany as one of its growth areas outside its US home market, alongside emerging giants India and Brazil, Andreas von Bobart, GE’s general manager for renewable energy in Germany tells Recharge.
“We are fairly confident that that we will have a significant share already next year,” von Bobart said.
That is quite ambitious, given that GE’s market share in Germany last year was zero. Even more ambitious is GE’s goal to conquer a double-digit market share in 2015.
To achieve that, GE has beefed up its German sales force and allocated funding for the development of a specific product catering to Germany’s up-and-coming market for turbines in inland low-wind locations.
The result is the new 2.5-120 turbine. It has a hub height of 139 metres, a 120-metre diameter rotor, a sensor-driven industrial internet connection and a purpose-engineered hybrid tower for high-efficiency in low wind regimes, such as in Schnaittenbach in the southern German state of Bavaria, where GE has just installed the first machine of that model.
Two more projects are under construction.
GE didn’t have to set up new manufacturing facilities for the 2.5-120. But it still has slack at its Salzbergen factory near Münster in northwestern Germany. The company currently churns out nearly 300 units there – all for export to other markets in Europe. But GE in Salzbergen could produce as much as 500 units a year.
From Salzbergen GE also supplies Turkey “for the time being”, von Bobart says, declining to comment on recent rumours in the local media that it wants to build a large manufacturing site in the growing wind power market on the Bosporus itself.
“I know there are discussions going on within Turkey to develop a large wind portfolio, that’s all I know,” he said – but made clear that Turkey isn’t the only country in the region that is lobbying for local wind turbine manufacturing.
“We are working on projects in various countries, particularly in the Eastern part of Europe. And there is a desire from various local governments to receive proposals for industrial plants and job creation. But this has to be carefully decided and clearly depends on project size, locations, duration of a market, and other factors."
While for the mature market of Germany GE has developed a machine designed especially designed for the low-wind market segment, in other regions the company seems to be on an aggressive push to expand into some markets by offering very competitive prices. Turkey again comes to mind.
Although GE doesn’t talk about its pricing strategy, von Bobart admits that Turkey isn’t “known as a high-price market. We can prove that our products work under difficult conditions and we are competitive.
“History has proven that it’s possible to produce at lower costs,” he says, but points out that the cost of energy doesn’t only depend on manufacturing costs, but to a great degree on quality and the accessibility of a site.
GE also appears to have lobbied Estonian developer 4 Energia aggressively in order to supply turbines for a 60MW wind park in Lithuania, Recharge has learned.
The project requires a rock-bottom turbine price, as 4 Energia won a recent tender for the project offering support of only €69.5 ($94.5) per megawatt hour of production, a level so low by European standards that at least one other manufacturer has admitted to Recharge that it currently couldn’t realistically produce for such a low-price buyer.
Von Bobart said he didn’t know about the project and GE wouldn’t comment on ongoing business transactions.
Pierre Viallefond, GE’s sales director Europe, Middle East & Africa, however, recently has acknowledged the company’s interest in the Baltic states.
“We are looking at growing markets, like Lithuania, where our 2.5-120 wind turbine perfectly fits, as its advanced technology drives higher wind farm output than GE’s current offerings, improves services productivity and creates new revenue streams for customers and pave the way to a subsidy-free world,” he told Recharge.
For more on GE Wind's European strategy, turn here.