Each year these European events are scheduled two to three months before North America’s largest industry gathering, AWEA’s WINDPOWER 2012. I’ve found over the years that the industry gestalt formed in Europe can offer an insightful glimpse of the future to come in the U.S. — or alternatively, it can seem as if these two wind industry markets are on two different planets rather than continents. Here are my takeaways from Europe this year.
Takeaways from Europe 2012
- US market will likely see a drop of nearly 60% through 2013 unless something dramatic happens and a PTC is passed.
- US market will take 3 years to recover, due to the low cost of energy and slow economic growth
- Industry is struggling with low margins worldwide
- Will be tough for the manufacturers to bridge the gap
- Should only invest money that is earned…sounds familiar
- Japan will be a place to watch post Fukushima
- From pro nuke to pro renewable
- No new nuke plants to be built
- The new Feed-in Tariff will be the key first step to building a good market
- Need to invest across the whole value chain
- Europe’s leaders have taken a longer view with long-term visions
- A level of uncertainty is now hitting the once stable European markets
- Big risk is the uncertain economies that are not stable or predictable
- Need to protect the investments we have made in the various markets by taking action now
- Commit to a timeline to make wind competitive with fossil fuels
- Political issues are making this industry very tough
- An area looks good – move in and build a plant – politics cause a slowdown and factories stop – can’t continue this scenario as it makes the cost of wind too high
- Local content issues keep costs up
- This is a dichotomy as local markets are demanding low energy prices versus high costs of adding local content
- Many of these are factors that really are no different from years ago, other than now the industry in much larger and the stakes are much higher.
- What the industry needs to do is:
- Reduce costs across the board
- Stay innovative but keep costs down of innovation projects by staying lean
- Shift market dollars from the traditional markets to the regional areas of growth
- Need to add value at the individual wind farm level
- Be smart with local content rules
- Standardize everything we can
Next month will find us in Atlanta for WINDPOWER 2012. Major U.S. turbine manufacturers have already announced layoffs and cancelled projects if the PTC is not extended beyond 2012. With little apparent hope for congressional action, it’s looking as if this will be a year in which at EWEA we saw an accurate glimpse of the future for the wind industry in the U.S.
Then again, prepared optimist that I am, I have to believe that if as an industry we heed what we heard in Europe and take concerted action, the ‘boom and bust’ wind energy cycle can be averted in the U.S. this year. I will let you know.
- Siemens says wind industry must cut costs rapidly (eco-business.com)
- European Wind Energy Association sees 500,000 jobs to Europe by 2020 (jobmarketmonitor.com)
- European Wind a "Recession-Busting" Industry (triplepundit.com)