Shcri.com: Siemens's First Wind Turbine Plant in China Is under Construction in Shanghai

May 25, 2009 - PRLog -- www.shcri.com - Siemens Wind Power Blades (Shanghai) Co., Ltd., the first wind turbine manufacturer of Siemens in China, was put into construction in Lingang New City in Shanghai which now owns top three wind power equipment manufacturers (Siemens, Shanghai Electric and Huayi Electric) and becomes one of China’s largest wind power equipment bases on May 22th, 2009, . Lingang New City, which has become the largest and most powerful nuclear power equipment base in China, today also serves as a new-energy base of electricity generation, transmission and distribution industry.

Siemens initially invests 100 million Euro in its wind power projects, 64 million Euro of which is invested in Siemens Wind Power Blades (Shanghai) Co., Ltd. With registered capital of 25 million Euro, this company is engaged in producing and installing blades, machine items and other spare parts of wind power equipment. In addition, Siemens is now establishing Siemens Wind Power Cabin (Shanghai) Co., Ltd. in Lingang New City, with investment of 12 million Euro and registered capital of 5 million Euro. This project will be in operation at the same time and in the same place as the blade project. An additional investment of 35 million Euro will be injected into the wind power cabin producing projects.

Siemens plans to produce blades of 2.3 and 3.6 MW for sea wind turbines. Compared with blades of 1.5 MW in China, those blades require stronger capacities as wind resistance and thunder resistance in order to protect themselves from being damaged. Currently, there are not many sea blade manufacturers and thus less competition will create more profits. On the contrary, the land blades require less complex technologies and thus suffer more competition, with the gross profit rate at 20 percent to 30 percent.

Later, the production base will start to produce cabins. Cabins which are installed at the top of tower, will support impellers and cover such major parts of wind turbines as gear case, gearing and electronic controller.

The annual production capacity of the base is expected to reach 500 MW. The first batch of blades and cabins is also predicted to finish in 2010. Siemens has reserved enough places for further development of blades and cabins in Lingang New City.

It is China’s huge wind power market that attracts Siemens to invest plants in China. By the end of 2008, China owned over 11,600 wind turbines, with the installed capacity increasing by 106 percent to about 12.153 million KW, making up 10 percent of the world’s total capacity and ranking the fourth after USA, Germany and Spain. In February 2009, Chinese government declared that to develop renewable energy sources including wind power are regarded as one of strategies against financial crisis.

Nowadays, there are more than 50 blade manufacturers in China. Although such foreign enterprises as LM and Euros enjoy more advanced technologies, domestic suppliers, such as Zhonghang Huiteng, Liyuan Hydraulic, Sinomatech, Zhongfu Lianzhong, etc , also capture big market shares.

The best partner of Siemens in Shanghai is Shanghai Electric. The joint venture, Shanghai Electric Power Generation Equipment Co., Ltd., has been in stable development since establishment.

As one of major wind turbine manufacturers in China, Shanghai Electric can directly buy blades from Siemens if both sides intend to maintain the partnership. But Siemens does not reveal the cooperation progress with each partners.

The global wind power base of Siemens is in Denmark, with the production capacity of 8,000 MW, which is the target of China’s wind power base several years later. With the expansion of wind turbine productivity, Siemens strives to be among the world’s top three wind turbine manufacturers in 2011.

Siemens stated that to establish bases in China is inevitable for the development of Siemens. China’s prescription of localization rate in 2005 is the major factor which contributes to the concentration of so many foreign wind turbine manufacturers in China, such as Siemens, GAMESA, NORDEX, Vestas and so on.

On July 4th, 2005, it is clearly regulated in “Notice on Requirements of Wind Power Management” by National Development and Reform Commission that the localization rate of wind power equipment should reach over 70 percent and those substandard wind power plants will not be established. The imported wind power equipment should also be taxed in line with the regulation.

“China is most likely to become the world’s largest wind power market. Thus we will further develop this environment-protected technology in order to lead in this field”, said Dr. Richard Hausmann, CEO of Siemens North East Asia, and president and CEO of Siemens Ltd., “Siemens has become the bellwether of environment-protected technology in infrastructure field. And we have made a big progress towards our target in 2010 – 40 percent of orders’ values are from our environment-related businesses through this investment.”

Source: China Research and Intelligence
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The primary and secondary research was conducted by consultants in China who know the industry and the local markets well.