GE and rivals gain ground on a global wind-turbine giant

Vestas Wind Systems A/S lost market share last year in the wind turbine industry it has dominated for more than a decade.

While the Danish manufacturer remains the biggest producer of the machines that generate electricity from the wind, General Electric Co. of the U.S. and Siemens Gamesa Renewable Energy SA of Spain gained share in the market for machines that work on land.

The findings in a report from BloombergNEF underscore the competitive pressures that are squeezing the industry, reducing margins even as the pace of installations accelerates in many nations. Last year’s drop in Vestas’s market share was the first BNEF recorded since it began keeping the data in its current form in 2014.

Wind power is likely to generate over a quarter of the world’s electricity by 2050, according to a BNEF forecast. The majority of that will come from onshore wind farms. In 2019, developers installed almost 61 gigawatts of wind turbines worldwide, up 22 per cent from the year prior. This year that number is forecast to jump an additional 24 per cent to 75 gigawatts, analysts at BNEF say.

The market for onshore wind power was mostly concentrated in China and the U.S. last year. GE installed about half of all the onshore turbines in the U.S., adding 40 per cent more turbines there than in it did in 2018. A few companies in China — Ming Yang Smart Energy Group Ltd., Zhejiang Windey Co., Ltd. and Dongfang Electric Corporation Ltd. — expanded market share there.

“2020 is set to be another strong year for installations in China and the U.S., as developers rush to build before subsidies lapse,” said Oliver Metcalfe, wind analyst at BNEF. “But uncertainty post-2020 could expose some bigger players unless they diversify to new growth markets.”

As for as offshore wind, Siemens Gamesa kept its top spot as Orsted A/S built out its 1.2 gigawatt Hornsea facility in the British section of the North Sea. Vestas pools its offshore wind assets in the MHI Vestas Offshore Wind A/S venture with Mitsubishi Heavy Industries Ltd. of Japan.

The offshore wind market will probably continue to grow faster than its onshore counterpart because the large size and scale of machines sited at sea.

Last year, GE received its first orders for the biggest turbine on the market, the Haliade-X, which it will deliver in the U.S. and U.K. in the coming years. That’s a sign that competition will only intensify now that the number of major offshore turbine suppliers has grown to three.

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