Siemens Energy announced that a large portion of its wind turbines could be suffering from faulty components, which sent its stock tumbling 36%, but many industry experts are concerned those problems may not be unique, CNBC reported July 3.
Siemens Energy announced on June 22 that between 15% and 30% of turbines installed by subsidiary Siemens Gamesa are currently suffering from component failure, prompting the company to withdraw profit estimates.
Christian Burch, CEO of Siemens Energy, said in a call with reporters June 30 that the quality control issues were “more severe than (he) thought possible,” according to CNBC.
The pace of change in the machinery has "put us into slightly uncharted territory,” Nicholas Green, head of EU capital goods and industrial technology at Alliance-Bernstein, told CNBC.
“(M)y best guess is that this probably actually is an industry-wide issue.," he stated.
The sheer size of modern turbines can intensify quality issues, Christoph Zipf, spokesman for European industry group WindEurope, told CNBC.
Yet, Zipf said that turbine failures are “extremely rare” and that “the problems at Siemens Gamesa are limited to Siemens Gamesa,” CNBC reported.
Competition in the sector is pushing original equipment manufacturers to "come up with bigger and better turbines at a fast rate, maybe faster than in other sectors,” according to CNBC.
While turbines are often certified for 20 years, most contain components that will fail during that time.
Turbine failure rates should be "more widely understood, given the scale of the potential impact on the overall profitability of projects,” Evgenia Golysheva, VP of strategy and marketing at ONYX.
Companies that build, finance and operate wind turbines "needs to have a realistic picture of how many failures to expect.”
ONYX expects that the industry will spend $4B on major repair projects by 2029, and that about 65% of maintenance costs in the industry are unplanned, CNBC reported.
“It’s a conversation that is overdue, because the underlying issues aren’t going away,” Golysheva told CNBC. (Daily Caller 07/03/23) The Entire Wind Energy Industry Could Be Facing Serious Technical Problems | The Daily Caller
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