Vestas ‘Confident’ U.K. Plant Will Be Built, Offshore Chief Says

Vestas Wind Systems A/S, the world’s biggest wind-turbine maker, is “very confident” it will build a factory in England to make its biggest-ever machine, the Danish company’s president of offshore power said.

Vestas in May announced it bought an option on 70 hectares (173 acres) of land at Sheerness, a port in Kent southeast of London, to build a plant that may create 2,000 jobs. Construction is dependent on new government incentives for offshore wind power and sufficient orders for Vestas’s V164 7- megawatt turbine.

“Given the fact that the option for land in itself was a significant investment, and the fact that we have people working every day on getting the permits and consents in place, we are very confident that this is going to happen,” Anders Soe- Jensen, who heads the company’s offshore division, said yesterday in an interview in a Vestas office in Ramsgate, Kent.

The V164, whose blades will sweep an area three times the area of the Wembley stadium football field, is Vestas’s main product to take the biggest share of U.K. offshore wind farms resulting from the country’s third round of site licensing last year. Construction is set to begin in 2015.

The U.K. must “fill in the blanks” in plans for incentives for renewable power, Soe-Jensen said. The government said in July that it’s projecting 18 gigawatts of offshore wind capacity by 2020, up from 1.3 gigawatts, and an increase on a prior 13-gigawatt goal. The country will also introduce instruments known as contracts for difference, which provide certainty on electricity prices, to spur renewables.

Siemens Takes Share

Britain in January 2010 awarded licenses for 32.2 gigawatts of offshore wind projects to companies including Centrica Plc, RWE AG (RWE), Statoil ASA, EDP Renovaveis SA and Scottish & Southern Energy Plc. (SSE) Soe-Jensen said he’s in talks to sell the V164 to all license winners except for developers of the proposed Hornsea farm, which include Siemens AG (SIE), Vestas’s biggest competitor in offshore wind turbines.

While Randers, Denmark-based Vestas took more than half of the market for offshore turbines last year, Soe-Jensen echoed Chief Executive Officer Ditlev Engel in saying the company won’t install any turbines at sea this year.

“We landed ourselves in this situation,” Soe-Jensen said. “We should have been faster with a new turbine model.”

London-based analyst Bloomberg New Energy Finance predicts Siemens will install 566 megawatts out of a European total of 916 megawatts this year, with the rest done by Bard Holding GmbH and Suzlon Energy Ltd.’s RePower unit.

‘Wow’ Factor

Vestas’s current main turbine offering for offshore markets is the 3-megawatt V112, introduced in 2009. None have yet been commercially installed, though developers including Dong Energy A/S, Eldepasco and PNE Wind AG (PNE3) have expressed interest, Soe- Jensen said. He said he’s had “loads” of interest in the V164, which isn’t expected to begin commercial production until 2015.

“The day we announced the V164 in London, I have never in one day received so many phone calls, text messages, e-mails from customers, colleagues, competitors, all going ‘wow’.” Soe- Jensen said. “The response I received was global.”

The new turbines will be able to generate enough electricity for 6,500 homes apiece, and will measure 164 meters (534 feet) from blade tip to blade tip. The portion of the machine above the waves will weigh 800 tons.

“Our expectation and inside business case is built around North European waters,” Soe-Jensen said. “When you look at the turbine, it is designed for the North Sea, so you can say if U.S. kicks off, if China kicks off, it’s just an added benefit.”

To contact the reporters on this story: Alex Morales in London at amorales2@bloomberg.net;

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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