Alt Energy: NY Times on Wind Energy in EU: Europe’s Wind Industry Is Stumbling When It’s Needed Most

This month, Siemens Gamesa Renewable Energy, a Madrid-based company that is the premier maker of offshore wind turbines, reported an annual loss of 940 million euros ($965 million). The company has announced a cost-cutting program that is likely to lead to 2,900 job losses, or nearly 11 percent of its work force.

Vestas Wind Systems, the world’s largest maker of turbines, recently reported a loss of 147 million euros (about $151 million) for the third quarter.

General Electric, a large maker of wind turbines in the United States and Europe, has also struggled in its clean energy businesses. The company said last month that its renewable energy unit was likely to record $2 billion in losses this year.


Sounds like one of those industries I don’t want to invest in.

He is no fool who gives what he cannot keep to gain what he cannot lose.

The wind turbine business has been hurt by inflation. Especially rising materials costs, transportation, and probably labor. Their contracts run for years and don’t have adequate cost escalators. Hence they are stuck with money losing contracts.

They will learn to do it better, but the nuclear power plant lessons apply. The buyer signs a contract somewhat like a blank check. Cost can escalate sharply. How do you know you can make money when project is completed? To build is risky. So Wait and see.

One day inflation will ease. But for now wind turbines are risky.


The wind turbine business can not continue to bid fixed price contracts. It was OK when inflation was so stable for years. The nuclear industry also learned that fixed price contracts are losers for nuclear projects.

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The nuclear power industry shows there are few buyers for blank check contacts. Lower inflation will help. We may want more green energy but wind looks unattractive until this problem is resolved. Or players learn to share the risks.

Nuclear power has worry about inflation more than other power generation facilities - they must worry about the high cost of expensive nuclear grade materials and equipment for building a reactor.

Nuclear power plants are costlier than any other power generation facility except hydro. Hydro projects may be more expensive, but they have other purposes and advantages with water supply/management. energy storage, and flood protection.

Wind energy is still more attractive than nuclear power. Wind power is growing worldwide while nuclear power is not growing. Maybe the new nuclear SMRs will do better cost wise than the current large nuclear reactors.