FRANKFURT – A reader of the annual report of Siemens, the German engineering giant, could easily get the idea that the company was investing in wind energy because management wants to save the planet.
“All our actions and decisions are informed by the principle of sustainability,” Siemens said in the introduction to its 2010 report, a few pages after the obligatory photograph of the chief executive, Peter Löscher, and the rest of the management board.
In smaller type on Page 90 is the fact that clean energy is a big moneymaker for Siemens. The renewable energy division, which consists mostly of the wind power business, recorded a bigger sales increase than any other unit in the quarter ended Sept. 30, rising 48 percent, to $1.3 billion. New orders rose 85 percent.
Still, the unit’s operating profit margin of 10.6 percent lagged that of more conventional businesses, like providing equipment for fossil-fuel power plants, and fell short of Siemens’ goal of a 12 percent to 16 percent margin. The unit accounted for about 5 percent of the total yearly profit for Siemens, whose array of products includes trains, factory equipment and X-ray machines.
But like any fast-growing business, there is also risk. The North American market has slumped just as Siemens, which does most of its manufacturing in Denmark, is stepping up investments in the United States and Canada.
On Dec. 3, Siemens opened a factory in Hutchinson, Kan., to make nacelles — housings the size of a bus that sit atop wind turbine towers and hold the mechanical and generating equipment. Siemens already has a blade factory in Fort Madison, Iowa, which opened in 2007, and is planning a plant in Tillsonburg, Ontario, to supply blades for nearby wind farms.
The company’s goal is to become one of the top three suppliers of wind power equipment in the world, up from eighth or ninth now. Vestas Wind Systems, a Danish company that focuses solely on wind power, is the market leader.
To have any chance, however, requires a foothold in China, the world’s largest market for wind power, and one of the most difficult to enter because of government policies that favor local companies. In November, Siemens opened a factory in Shanghai, a city chosen in part because it is on the water and a good place from which to ship equipment for offshore wind parks, a niche in which Siemens is the No. 1 equipment supplier.
The Asian market is the largest and fastest-growing for wind power, accounting for an estimated 44 percent of global capacity, according to IHS Emerging Energy Research. Europe is second, with 34 percent of global capacity, and North America third, with 19 percent.
Siemens is also planning factories in the emerging markets of India and Russia as well as in Britain where, despite an austerity budget, the government is strongly backing the development of offshore wind projects.
In the United States, makers of wind power equipment have had to contend with fickle government incentives and a plunge in the price of natural gas, which made wind energy less competitive. In addition, the financial crisis has made it harder for smaller operators to get loans to build wind parks.
“The U.S. was supposed to be one of the most attractive markets,” said Eduard Sala de Vedruna, a research analyst for wind power at IHS Emerging Energy Research. “It’s not going to be as attractive as it used to be.”
Like General Electric, the market leader in wind power in the United States, Siemens may have an advantage against upstarts because it has long supplied equipment for conventional power plants and transmission facilities run by big utilities. Siemens also has a long history in countries like Russia and China, where the company sold telegraph equipment as early as 1872.
“Siemens already had some good relationships,” Sala de Vedruna said. “They understand the business of generating electricity.”
In a measure of how wind has become mass-market, the Kansas factory will feature a moving assembly line, like an auto factory. In older factories, designed when volumes were lower, the units were assembled in place, a less efficient method. The assembly line cuts the time it takes to build a nacelle to 19 hours from 36, according to Siemens.
Sala de Vedruna said that he thought the long-term prospects for wind power in the United States were still bright. Siemens apparently agrees — and wants to get closer to the customer.
“America is for us still the single largest market,” said René Umlauft, chief executive of Siemens Renewable Energy. Wind turbine components “are large and heavy, and it costs money to move them from one place to another.”
Siemens got into the wind business only in 2004, when it acquired a maker of wind turbines in Brande, Denmark, which remains the headquarters of the wind unit. Watching that business expand seems to have given Siemens an appetite for other investments in renewable energy.
In 2009, Siemens acquired Solel, an Israeli company that makes components for plants that use concentrated heat from the sun to generate power. And last February, Siemens got a minority stake in Marine Current Turbines, a British firm that makes equipment for generating electricity from ocean tides.
These technologies are still years from mass deployment. But, Umlauft said, “we want to do the same thing that we did in wind.”
- green energy ppt
- ppt on green energy
- ppt on green energy in india
- ppt on green energy technology
- concord pacific green energy
- World of Renewables
Siemens’ Fort Madison manufacturing facility is designated as first stop in Obama’s Midwest ‘Washington to Main Street Tour’. FORT MADISON, Iowa, PRNewswire-FirstCall/ — Today, Siemens hosted the President of the United States, Barack Obama, for a tour and visit to its recently expanded 600,000 sq. ft. wind turbine blade facility at Fort Madison, Iowa.
- Buffett’s MidAmerican Energy
Just a couple weeks after Siemens opened the doors of its new nacelle assembly plant in Kansas, the global engineering and manufacturing powerhouse received an order that will keep the new plant plenty busy in 2011. On Tuesday, Siemens AG (NYSE: SI) inked a huge deal with the Iowa utility MidAmerican Energy for 258
- Reinforced Plastics
“With the new wind turbine production plant in the UK, we’re pushing ahead with our strategy of investments in attractive growth markets for eco-friendly technology,” says Peter Löscher, President and CEO of Siemens AG. “In the foreseeable future, the wind power market in the UK will be characterized by major offshore projects, and we’ll extend
- President talks jobs, prosperity at Iowa factory
FORT MADISON, Iowa — In a city socked by hard times even before the recession, President Barack Obama told factory workers here Tuesday that his administration is laying the groundwork to put the country “on a new foundation for long-term growth and prosperity.” The president toured the Siemens Energy plant, which makes blades for wind
- Made in Hutchinson, Kansas, USA
Siemens demonstrates its confidence in the U.S. renewable energy market by continuing to invest in the U.S. In line with its ongoing U.S. manufacturing expansion efforts, Siemens Energy celebrated the official opening of its new wind turbine nacelle assembly facility in Hutchinson, Kansas, today. This is an important milestone in Siemens’ growth strategy in the