German industry survey

Record year but exports poor

by Sara Knight, WINDPOWER MONTHLY, Dec. 1997, 23

Wind turbine manufacturers expect to install 460 MW of wind capacity in Germany in 1997, compared with 423 MW in 1996. This will raise total German wind power to over 2000 MW, according to the results of an annual survey of the wind industry carried out by the International Renewable Energies Forum, based at the University of Münster.
The survey describes 1997 as a satisfactory year, not only for wind capacity installation but also for wind power output. Electricity generation could reach 3.3 billion kWh this year, 50% more than the 2.2 billion kWh achieved in 1996, a year of weak winds, according to survey author Norbert Allnoch.
Looking ahead at likely changes on the finance markets, Allnoch warns that the period of low interest rates in Germany may be coming to a close. As interest rates start heading up again, financing costs for wind projects will also show a slight increase, which may put a brake on the readinessof potential wind plant investors to go ahead with projects, especially in inland areas.
This could mean trouble. German wind industry exports remain weak and "even a temporary weakness on the home market cannot be compensated by corresponding exports," warns Allnoch. The domestic market still provides the base of economic survival of German wind turbine makers.
The largest of them in terms of domestic sales, Enercon, says it has exported just 48 MW of the over 650 MW it has sold so far. The turbines have gone to ten countries, the most recent of which is Finnland. An E40 on the island of Kökar at the mouth of the Gulf of Bothnia now sends power to the much larger neighbouring island of Aland, says Enercon's Robert Mansen. Enercon competitor Nordex Balcke-Dürr, formed as a German entity 18 months ago, says its exports amounted to 40 MW in the past year.
Allnoch identifies several reasons for the feeble level of exports, ranging from the relatively late entry of German wind companies onto the market, incomplete global marketing structures, the requirement for long term planning, and weaknesses in the strategic support provided by the Länder (states) and federal governments, and poor communication between government ministries offering support.
Meantime at home, Germnay can flatter itself with the title of world leader in wind power, but this may not last, warns Allnoch. He points out that annual installed capacity is rising thanks to the larger turbine sizes on the market; unit sales are falling. "As the number of turbine units purchased dwindles in a buyer's market, the price and sales pressure combined with the often insufficient equity ratio of middle sized companies can often become a threat," he says.

Note: The annual survey (autumn report) is written in August and published in the October issue of the journal "Energiewirtschaftliche Tagesfragen"