Europe’s ever-challenged wind industry gathered in Bilbao, Spain, where the industry stressed its value to policymakers, celebrated legislative wins, and pointed to a less turbulent horizon.
Following years of stalled build-out and supply chain troubles, Europe’s wind power industry looked to be a dead man standing in 2023. Europe’s turbine manufacturers were posting losses across the board, Siemens Energy had to be bailed out by the German government.
In 2024, things look less bleak. Vestas, the Danish powerhouse, became profitable once more in the second half of 2023 amid eased supply chain disruptions and an uptick in wind turbine orders.
But while wind flagged, solar panels got used to the limelight. The IEA, a Paris-based energy watchdog, expects more than 70% of new renewables installed in Europe by 2028 to be panels rather than turbines. Aside from Chinese modules, their cheap turbines loom large too.
‘Our wind, our value’
But Europe’s sprawling manufacturing ecosystem of turbine blades to large-scale developers won’t go down without a fight. “Our wind, our value,” was the tagline of the industry’s annual jamboree, hosted in Bilbao, Spain, this time around.
Spaniards need the reminder: since 2019, cumulative wind power capacity scarcely grew, while solar capacity trebled. After Germany, the country is the wind industry’s second-biggest customer, with some 31 GW of turbines installed before the slump.
“Creating value for Europe, living up to Europe’s values,” the message for the event hosted by WindEurope, the Brussels trade association of the industry that banned non-European members in 2023, adds.
A report commissioned for the event hopes to underline that message, showing that wind will contribute €49 billion to European GDP (or 0.22%), saving four Nord Stream 1’s worth of gas every year, and cutting emissions by a whopping 262 million tonnes CO2 every year by 2030.
The sector hopes to employ more than 500,000 workers, up from 300,000. Unlike solar, where most of the jobs are in installation and maintenance, the wind industry offers coveted jobs in heavy industry, lobbyists stress.
In a Spanish factory operated by Nordex, a turbine blade goes through 200 hands before it is shipped out, including one full-time job for someone to smooth wrinkles out of the blade’s glass fibre structure with a mop.
The troubles of the wind industry
But solar, which thrives in the sunny country, is openly nipping at wind’s heels on all fronts. Or as renowned analyst Jennifer Chase put it: “Solar will get built anyway, but wind needs some help,” and policymakers have a large incentive to provide it.
Wind blows in the night, and in winter, the two technologies are complementary, the argument goes.
“We cannot compensate for theoretical wind outperformance with additional solar capacity due to very different profiles of solar and wind capacity factors throughout the year in most European locations,” the 2024 report by Rystad Energy stresses.
So, what ails Europe’s ever-bereaved wind industry? The annual industry report continues to blame inflation – alongside inflexible auction design unable to respond – and high-interest rates.
Dependence on China is another problem. European companies imported turbine parts worth €3 billion from China – the country accounts for 50% of the total.
What help is wind getting?
For the wind industry, help has come in the form of EU laws. The reworked renewables directive (RED III) has put in place clear objectives for 2030 – by then, the whole European energy system ought to be at least 42.5% renewable.
The wind industry is expected to install some 420 GW of capacity to feed the demand for renewable electricity – Chris Willow, who handles floating wind at German energy giant RWE, told a group of journalists in Bilbao that this amounted to “policy certainty” and was crucial.
When the energy crisis rattled Europe, a German initiative saw the RED bolstered by a cap on the maximum length permitting procedures may take – addressing another of the industry’s main ails. As a result, permits are up 70% in Germany for 2023.
Other wins include: “disabling a permanent inframarginal revenue cap” as part of the EU’s 2023 minor overhaul of its power market design.
Wind power installations are usually guaranteed a given off-take price, putting a floor on losses, but there is no cap on record revenues – initial versions of the electricity market design overhaul had envisioned such.
Avoiding revenue caps – allowing for sky-high profits in times of scarce energy – had been one of the industry’s key priorities for 2023.
Rystad found that the wind industry had received 80% of the support measures it asked for across a series of multiple laws. Gathered in Bilbao, the industry was more cheer than gloom in the face of such a track record.
“We’re now confident that we can get close to the EU goal that wind is 35% of electricity by 2030, up from 19% today,” said WindEurope CEO Giles Dickson in late February.
[By Nikolaus J. Kurmayer I Edited by Brian Maguire | Euractiv’s Advocacy Lab ]
