Europe’s wind turbine makers are in financial freefall; with subsidies slashed, demand for turbines has collapsed, input costs are soaring and their Chinese competitors are benefiting from their cheap and reliable supplies of coal-fired power. Oh, the irony!

The barely disguised panic in this article from ReCharge (one of Europe’s leading wind and solar propaganda outfits) suggests that Europe’s wind industry rent-seekers should be kept well away from sleeping pills and sharp objects, for the foreseeable future.

The nature of the wind industry’s implosion is spelt out in this quote from one of them: “the economics in the wind industry had been destroyed due to price pressures from competitive tenders coupled with a low visibility of wind capacity pipelines due to failed government policies.”

The “competitive tenders” are coming from China’s turbine makers, which enjoy power prices a fraction of those being suffered in Germany, thanks to an abundant supply of nuclear and coal-fired power.

And the reference to “failed government policies” is to be read as a gripe about the fact that Europe’s policymakers have already slashed subsidies to wind and solar.

However, as you read on, there is also the stark realisation that Europe’s obsession with unreliable wind power has left it thoroughly vulnerable to Vladimir Putin and his ability to restrict Europe’s access to the gas it needs to keep the lights on when the sun sets and/or calm weather sets in. That vulnerability has led to major backflips and energy policy, not least in Germany where the decision has been made to keep its coal-fired and nuclear power plants open, notwithstanding (set-in-stone) policies to shut down both classes of generator by year’s end.

Now, the only thing that seems ‘inevitable’ about Europe’s inevitable transition to an all wind and sun-powered future is bankruptcy for those who have, hitherto, profited so very handsomely from the greatest economic and environmental fraud, of all time. Oh dear, how sad, never mind.

‘We’re all in trouble’ | Wind turbine makers selling at a loss and in a ‘self-destructive loop’, bosses admit
ReCharge
Bernd Radowitz
5 April 2022

Raw material and logistics inflation coupled with downward price pressures from auctions have led to an unsustainable situation where wind OEMs are selling at a loss, with the sector unable to deliver Europe’s planned tripling of wind capacity by 2030, industry leaders have warned.

“The state of the supply chain is ultimately unhealthy right now,” GE Renewable Energy chief executive for onshore wind, Sheri Hickok, told a panel at the WindEurope 2022 conference in Bilbao on Tuesday.

“It is unhealthy because we have an inflationary market that is beyond what anybody anticipated even last year. Steel is going up three times.”

Steel for offshore wind towers is currently being purchased at over $2,000 per tonne, Hickok gave as example, adding that the prices of copper, carbon and logistics had also soared.

“It is really ridiculous to think how we can sustain a supply chain in a growing industry with these kind of pressures.”

After hefty price hikes last year in the wake of the Covid-19 pandemic “things were higher but stabilising,” Hickok said, but added that with Russia’s war in Ukraine, the entire system had “unhinched” again in the past eight weeks, making it unsustainable at an unprecedented level of uncertainty.

The GE executive said she is very fearful for the entire wind industry ecosystem.

“Right now, different suppliers within the industry are reducing their footprint, they are reducing jobs in Europe,” she explained.

“If the government thinks that on a dime, this supply chain is going to be able to turn around and meet two to three times the demand, it is not reasonable.”

The European Commission’s recent REPowerEU plan, formulated in response to Russia’s invasion of Ukraine, wants wind power capacity to soar from 190GW today to 480GW by 2030.

Destructive loop
Nordex chief executive José Luis Blanco stressed that even before the Ukraine war, the economics in the wind industry had been destroyed due to price pressures from competitive tenders coupled with a low visibility of wind capacity pipelines due to failed government policies.

“We are still selling at loss, because of the dynamic of auctions, the low predictability of volumes,” Blanco told the conference.

“We are investing in volumes in trust in market dynamics, then the volume doesn’t come, then a factory is empty, [and then] it is better [to have] some cash flow than no cash flow — and [consequently] the sector enters into a self-destructive loop.”

Blanco also said if Europe wants to triple its wind power capacity, it needs to better support the independence of the supply chain.

Currently, some 85% of the industry’s components are, however, coming from China, he said.

“The energy independence is supported by a supply-chain dependency policy. This a huge risk.”

Blanco was not only referring to rare earths, but said “normal things” such as metallic shafts in turbines, 95% of which are sourced in China.

All onshore OEMs in trouble
Enercon’s new chief executive Jürgen Zeschky went even further, saying “all European onshore OEMs are in trouble.”

Over the past eight years, cost was the only driver for developments, with low levelised costs of energy and low turbine prices driving the whole business, he told WindEurope 2022.

“We have reached a low cost base, but at the price of outsourcing to low-cost countries,” Zeschky admitted.

“If you look at Europe and Germany, we are constantly losing jobs in industry by relocating to other places.”

But the situation has changed fundamentally, he pointed out.

Due to Russia’s war in Ukraine, “we are faced with a situation, where it is not only about cost, but about an independent, resilient and reliable energy situation in Europe”.

To have sustainable energy generation, Europe needs a sustainable industry, and thus has to overcome being constricted to the lowest cost, he explained.

“That needs to change.”
ReCharge

From The MANHATTAN CONTRARIAN

April 20, 2022/ Francis Menton

If you’ve been reading this blog lately, you know that the mythical transition to an energy future of pure “green” wind and solar electricity faces a gigantic problem of how to provide energy storage of the right type and in sufficient quantity. To make the electrical grid work, the wildly intermittent production of the wind and sun must somehow be turned into a smooth flow of electricity that matches customer demand minute by minute throughout the year. So far, that task has been fulfilled largely by natural gas back-up, which ramps up and down as the sun and wind ramp down and up. But now governments in the U.S., Europe, Canada and elsewhere say they will move to “net zero” carbon emission electricity by some time in the 2030s. Natural gas emits CO2, so “net zero” means that the natural gas must go. The alternative is energy storage of some sort.

Clearly, it is time to start figuring out how much energy storage we’re going to need, and of what type. Indeed, it is well past time to start figuring that out. If our government were even slightly competent, and also serious about “net zero” electricity by 2035, it would by this time have long since put together detailed feasibility and cost studies and demonstration projects showing exactly how this is going to work. Naturally, they don’t have any of that.

So how can this problem be addressed? One approach, discussed multiple times previously on this blog, would be to collect detailed data on hourly electricity usage and also hourly production from existing wind and solar facilities, and use that data to create a spreadsheet that will reveal information like how many gigawatt hours of storage will be needed, how long the energy must be kept in storage, over what period the energy will be discharged, and how much this will likely cost. Examples of such exercises have been reported multiple times previously here, most recently, for example, in this post of January 14, 2022.

But if that’s how you would approach this problem, then you don’t think like a progressive. To get some insights into the progressive approach, we turn as always to the New York Times. The Times has not up to now devoted a lot of its precious time and attention to this energy storage issue, but it so happens that they broached the subject in a substantial article that appeared yesterday on the front page of the business section, headline “Energy Fixes Exist. But They Need Money.” (The online headline is different.). The bylines are Eshe Nelson and Adam Satariano.

You can get the gist from the headline itself. The high status people like Times reporters and government functionaries have decided that the planet must be saved; and they assure us that “fixes exist.” It is now up to someone else to put up the money so that the low status people can do the menial task of working out the details.

The Times articulates the problem as follows:

The problem: how to make wind and solar energy available 24 hours a day, seven days a week, even if the sun is not shining or the wind not blowing.

And how do we know that the “fixes exist”?

Solutions are available if given a financial boost, experts said.

Aha! — It’s the usual Times resort to the famous un-named “experts.” None of these experts are either named or quoted in this piece. Nor is there any mention of such issues as how many gigawatt hours of storage might be needed to back up the U.S. grid if powered only by wind and sun (the calculation in the January 14 post came to about 250,000 GWHs), or of how much that might cost, or whether batteries that can do the job can be produced, or are technologically feasible, to store energy for months on end and discharge it over the course of more months. Instead, we learn, for example, about the travails of Jakob Bitner’s battery company, VoltStorage.

VoltStorage needs “significantly” more money to develop its new battery technology, Mr. Bitner said. In 2020 and 2021, the company raised 11 million euros, or $12 million. Now, it is trying to raise up to €40 million more by this summer. “Even though we had great early-stage investors from Germany and Europe that keep supporting us, it becomes very hard to raise the tickets we need right now,” Mr. Bitner said, referring to individual investments.

So if this company and its technology are so promising, why aren’t investors lining up for the chance to put up money? According to the Times, it’s because those stupid venture capitalists have turned their attention to making a quick buck on the latest worthless fads, while the planet suffers.

Venture capitalists, once cheerleaders of green energy, are more infatuated with cryptocurrencies and start-ups that deliver groceries and beer within minutes. Many investors are put off by capital-intensive investments.

Could it be that the smart investors take a look at these proposed new battery technologies and immediately realize that they cannot deliver the necessary storage at affordable cost, or that they cannot meet the tests of being able to store energy for months and discharge over the course of months? Those possibilities are not mentioned here. After all, “experts say” that “solutions are available.”

And what do these “investors” say when confronted about their hesitancy to invest in new energy storage projects? You won’t be surprised:

[I]nvestors say government policy can help them more. Despite climate pledges, the regulations and laws in place haven’t created strong enough incentives for investments in new technologies.

What “government policy”? Well, to start, the government needs to suppress the existing industries that produce the carbon emissions:

Industries like steel and concrete have to be forced to adopt greener methods of production, Mr. Boni, the 360 Capital founder, said.

And as in essentially all Times pieces, it’s only a question of time before we get to the demand for government funds to subsidize the project:

For energy storage . . . and other large-scale projects, the government should expedite permitting, cut taxes and provide matching funds, said Mr. Fadell. . . .

Don’t worry, in New York Times world the government has infinite money.

Read the full post here.