German company Siemens Energy AG, also known as Siemens Energy, has informed its customers that it plans to produce the largest wind turbine and is likely to start production by the end of the 2020s, aiming to maintain a leading position in one of the fastest-growing energy sectors.
According to Bloomberg, sources familiar with the matter disclosed that the company’s goal is to introduce an offshore wind turbine with a power capacity of approximately 21 megawatts, exceeding the largest equipment offered by its Chinese competitors.
The planned equipment is expected to have a power capacity about 40% higher than the company’s current largest turbine, with blades measuring 115 meters (377 feet). This move may trigger a new trend among western companies to launch larger equipment, as the surge in introducing bigger turbines has been delayed due to severe losses faced by the wind power industry in recent years.
Siemens Energy’s wind power division has been struggling due to issues such as supply chain bottlenecks, soaring costs, and quality concerns, with a significant portion of the challenges arising from onshore operations. However, it remains the largest supplier of offshore wind turbines outside of China.
Last year, the European Union allocated €30 million to wind turbine manufacturer Siemens Gamesa to test the “world’s most powerful wind turbine prototype” at a factory in Osterild, Denmark. However, the funding did not include details regarding the scale or timeframe for the equipment’s potential market launch.
A spokesperson for Siemens Energy stated in a release, “We will only decide on installing new products in commercial projects after thorough testing.”
Siemens is facing increasingly stiff competition from its main rival, Danish company Vestas Wind Systems, especially after the latter’s decision to focus more on the offshore market following an acquisition deal in 2020. Henrik Andersen, CEO of Vestas, believes that turbines have now grown as large as skyscrapers and are already big enough.
Previously, companies rushed to introduce new turbine models quickly, while Siemens Energy and its competitors have slowed down, aiming to extract more profits from existing models. The upcoming launch of the giant new turbine indicates that Siemens Energy has recognized the market shifts.
Historically, increasing turbine sizes helped lower the electricity generation costs of wind farms. However, recent quality and reliability issues within the industry might challenge customer interests. The recent offshore wind auction in New York failed as GE Vernova Inc. stated they could not deliver the new, larger turbines planned for purchase by the winning bidder.
(Reference: Bloomberg)