Turbine troubles have sent wind energy stocks tumbling — and a slew of issues remain
A Siemens Gamesa blade factory on the banks of the River Humber in Hull, England on October 11, 2021.
PAUL ELLIS | AFP | Getty Images
As the biggest players in wind energy gear up to report quarterly earnings, supply-chain reliability issues are front and center for both stock analysts and industry leaders.
Siemens Energy made the headlines earlier this year when it scrapped its profit forecast and warned that costly failures at wind turbine subsidiary Siemens Gamesa could drag on for years.
It sparked concerns about wider problems across the industry and thrust Europe’s wind energy giants’ earnings into the spotlight.
Siemens Energy is set to report its fiscal fourth-quarter results on Nov. 15. Its shares are currently down more than 35% year-to-date.
Aside from the turbine problems, the German energy giant posted orders of around 14.9 billion euros ($15.7 billion) for its third quarter, a more-than 50% increase from the previous year, primarily driven by large orders at Siemens Gamesa and Grid Technologies. Yet the 2.2 billion euro charge due to Gamesa’s quality issues prompted Siemens Energy to forecast a net loss for the fiscal year of 4.5 billion euros.
Ahead of its fourth-quarter earnings, analysts at Kepler Cheuvreux suggested in a research note Tuesday that despite having already warned on profits, the company “remains vulnerable to large negative cashflow swings in the next fiscal year.”
“We expect Siemens Gamesa to suffer very weak order intake in H1, which will combine with extensive delivery delays and rising customer penalty payments. Challenges at Siemens Gamesa will continue to overshadow resilience in the group’s other divisions,” they added.
Morgan Stanley cut its price target for Siemens Energy from 20 euros per share to 18 euros per share, but retains an overweight long-term strategic position on the company’s stock.
“Valuation for Siemens Energy is currently factoring in a negative value for the Gamesa division, which we believe may have been over penalized,” Morgan Stanley capital goods analyst Ben Uglow said in a research note Monday.
“While we acknowledge the low visibility on Gamesa margin trajectory and that rebuilding investor confidence will take time, we remain Overweight on undemanding valuation and good fundamentals of the Gas & Grid businesses.”
Elsewhere, Deutsche Bank earlier this week slashed its 12-month share price forecast for Danish wind energy producer Ørsted by 36% ahead of its interim earnings report on Nov. 1. The stock has already halved in value so far this year.
Read more:
Deutsche had previously highlighted challenges in the wind turbine industry including supplier delays, lower tax credits and rising rates. However, Ørsted’s share price tanked further earlier this year when it raised the possibility of a 2.1-billion-euro impairment charge in its U.S. offshore wind portfolio.
Meanwhile, Danish wind turbine manufacturer Vestas — despite continuing to bag significant orders — has seen its shares plunge by around 30% year-to-date as reliability concerns plague the wider industry. Vestas publishes its interim financial report for the third quarter on Nov. 8.
Supply chain worries
ONYX Insight, which monitors wind turbines and tracks over 14,000 across 30 countries, revealed in a report Tuesday that supply chains remain the greatest challenge to the sector, with reliability not far behind.
The analytics firm, which is owned by British energy giant BP, interviewed senior personnel at over 40 owners and operators of wind turbines around the world in order to gauge the mood of industry leaders, and found that 57% cited the supply chain as the main obstacle to their operations.
ONYX Chief Commercial Officer Ashley Crowther said the lingering impacts of Covid-19 on manufacturing had just begun to heal — and then Russia’s invasion of Ukraine and the subsequent surge in inflation hit.
“Survey participants are now citing delays on new projects due to longer lead times for supply of new turbines and significant price increases,” Crowther said in the report.
“This is in line with what OEMs have told their investors, for example Vestas noting in their 2022 annual report they ‘increased our average selling prices of our wind energy solutions by 29%’. Similarly for major components, particularly main bearings on newer turbines with large rotor diameters, long delays are leaving turbines offline for extended periods.”
Although supply chain issues are creating problems for operators, the most direct impact has been on OEMs like Siemens Gamesa and Vestas, Crowther noted, as has been evident in recent financial results.
“Major western OEMs have recently reported losses or profit warnings and announced major restructuring projects in order to address the challenges they are facing. Some are even re-thinking their approach to the aftermarket which was always seen as the most profitable part of the business,” he added.
Reliability issues
Those surveyed by ONYX also expressed reliability concerns, with 69% expecting more reliability issues due to aging assets and 56% seeing problems associated with new turbine technology. Just 22% expected fewer reliability issues due to new turbine technology improvements.
“As the sector matures, turbines are getting older and the failure rate of electromechanical systems are increasing with age,” Crowther noted.
“Likewise, the initial operating period of newer turbines are seeing a rash of failures due to shorter development cycles, new turbine designs, and a squeeze on turbine prices. This is resulting in machines that are not durable enough.”
During an initial boom in the wind industry a number of years ago, OEMs faced huge market demand and, in turn, created a variety of turbine designs delivered on short cycles to a customer base seeking to generate more energy with greater efficiency at lower cost, Crowther explained.
“Fast-forward to the present and between the perfect storm of supply chain issues and too many turbine designs to support, OEMs have been losing significant amounts of money, including those paid out in liquidated damages (LDs),” he said.
“Manufacturers have been locked into a price competition spiral, attempting to produce larger turbines for more competitive pricing. But with bigger turbines produced in shorter production cycles, it’s no surprise that manufacturing quality has diminished.”
Renewables and nuclear provided 40.9% of the world’s power generation in 2024, passing the 40% mark for the first time since the 1940s, according to a new global energy think tank Ember report.
Renewables added a record 858 TWh in 2024, 49% more than the previous high in 2022. Solar was the largest contributor for the third year running, adding 474 TWh to reach a share of 6.9%. Solar was the fastest-growing power source (+29%) for the 20th year in a row.
Solar has doubled in just three years, providing more than 2,000 TWh of electricity in 2024. Wind generation also grew to 8.1% of global electricity, while hydro – the single largest renewable source – remained steady at 14% of global electricity.
“Solar power has become the engine of the global energy transition,” said Phil MacDonald, Ember’s managing director. “Paired with battery storage, solar is set to be an unstoppable force. As the fastest-growing and largest source of new electricity, it is critical in meeting the world’s ever-increasing demand for electricity.”
Ember’s sixth annual Global Electricity Review, published today, provides the first comprehensive overview of the global power system in 2024 based on country-level data. It’s published alongside the world’s first open dataset on electricity generation in 2024, covering 88 countries that account for 93% of global electricity demand, as well as historical data for 215 countries.
What drove the rising power demand
The analysis finds that fossil fuels also saw a small 1.4% increase in 2024 due to surging electricity demand, pushing global power sector emissions up 1.6% to an all-time high.
Heatwaves were the main driver of the rise in fossil generation, accounting for almost a fifth (+0.7%) of the increase in global electricity demand in 2024 (+4.0%), mainly through additional use of cooling. Without these temperature effects, fossil fuel generation would have risen by only 0.2%, as clean electricity generation met 96% of the demand growth not caused by hotter temperatures.
“Amid the noise, it’s essential to focus on the real signal,” continued MacDonald. “Hotter weather drove the fossil generation increase in 2024, but we’re very unlikely to see a similar jump in 2025.”
Aside from weather effects, the increasing use of electricity for AI, data centers, EVs, and heat pumps is already contributing to global demand growth. Combined, the growing use of these technologies accounted for a 0.7% increase in global electricity demand in 2024, double what they contributed five years ago.
Clean power will grow faster than demand
Ember’s report shows that clean generation growth is set to outpace faster-rising demand in the coming years, marking the start of a permanent decline in fossil fuel generation. The current expected growth in clean generation would be sufficient to meet a demand increase of 4.1% per year to 2030, which is above expectations for demand growth.
“The world is watching how technologies like AI and EVs will drive electricity demand,” said MacDonald. “It’s clear that booming solar and wind are comfortably set to deliver, and those expecting fossil fuel generation to keep rising will be disappointed.”
Beyond emerging technologies, the growth trajectories of the world’s largest emerging economies will play a crucial role in defining the global outlook. More than half of the increase in solar generation in 2024 was in China, with its clean generation growth meeting 81% of its demand increase in 2024. India’s solar capacity additions in 2024 doubled compared to 2023. These two countries are at the forefront of the drive to clean power and will help tip the balance toward a decline in fossil generation at a global level.
Professor Xunpeng Shi, president of the International Society for Energy Transition Studies (ISETS), said: “The future of the global power system is being shaped in Asia, with China and India at the heart of the energy transition. Their increasing reliance on renewables to power demand growth marks a shift that will redefine the global power sector and accelerate the decline of fossil fuels.”
Read more: Made-in-America solar just got a big win in Louisiana
If you live in an area that has frequent natural disaster events, and are interested in making your home more resilient to power outages, consider going solar and adding a battery storage system. To make sure you find a trusted, reliable solar installer near you that offers competitive pricing, check out EnergySage, a free service that makes it easy for you to go solar. They have hundreds of pre-vetted solar installers competing for your business, ensuring you get high quality solutions and save 20-30% compared to going it alone. Plus, it’s free to use and you won’t get sales calls until you select an installer and share your phone number with them.
Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisers to help you every step of the way. Get started here. –trusted affiliate link*
FTC: We use income earning auto affiliate links. More.
The next-gen LEAF is almost here, and it’s looking better than ever. This isn’t the electric hatch you are used to seeing. Nissan’s new LEAF EV has more range, a fresh crossover design, and yes, it can finally charge up at Tesla Superchargers with an NACS port. With the official reveal just around the corner, someone already spotted the new LEAF at a Tesla charger in Canada.
Nissan is launching the new LEAF in the US and Canada
A little over a week ago, we finally got our first look at the third-generation LEAF. Nissan’s iconic electric hatch has grown into a “sleek and spacious family-friendly crossover.”
The US and Canada will be the first to see the reimagined LEAF later this year. It will join the Ariya in Nissan’s North American EV lineup as it looks to spark growth in one of its most important markets.
Based on the CMF-EV platform, the same one underpinning the Ariya, Nissan promises the new LEAF will have “significant range improvements.” Although no other details were revealed, Nissan’s vehicle programs chief, Francois Bailly, told TopGear.com that it’s expected to have WLTP driving range of up to 373 miles (600 km).
It will likely be lower on the EPA scale, but anything even close to 300 miles would be a major improvement over the current 212 EPA-estimated miles offered on the 2025 LEAF SV Plus.
The next-gen LEAF will also be Nissan’s first EV to feature an integrated NACS charging port. With its official debut later this year, the new model is out for testing and was just caught testing at a Tesla Supercharger in Canada.
If you didn’t know what vehicle it is, the LEAF is hardly recognizable. The new image from KindelAuto gives us a closer look at the new crossover design. It almost looks like a Tesla sitting in front of the charger.
The new LEAF is one of 10 new and refreshed Nissan vehicles set to launch in the US and Canada. It will arrive later this year, followed by the fourth-gen Rogue in 2026, which will be available as a PHEV for the first time.
Nissan also plans to build a new “adventure-focused SUV” at its Canton, Mississippi, plant in late 2027. The teaser shows what appears to be a rugged electric Xterra. We’ll have to wait for more details on that one.
Nissan will reveal additional info about the upcoming LEAF mid-year. Check back soon for more updates.
FTC: We use income earning auto affiliate links. More.
The Port of Barcelona launched the Ecocat Tres, a highly efficient, all-electric commuter ferry powered by Molabo’s ARIES i50 electric motors.
Ecocat Tres is the latest zero-emission ferry in Bus Nàutic’s growing electric fleet, providing clean transportation between the Drassanes and Llevant wharves. In just its first three months, the Bus Nàutic service logged over 125,000 sustainable trips. Operated by ALSA and backed by the Port of Barcelona, the initiative offers locals and visitors an eco-friendly way to travel, cutting down on road congestion and air pollution in the bustling city.
Built by Spanish shipbuilder Metaltec Naval, Ecocat Tres is a 15-meter aluminum catamaran that carries up to 84 passengers. It even includes a rooftop deck, offering extra seating and a breezy ride across the port. The ferry runs every 15 to 30 minutes for at least 12 hours each day, with the entire trip taking about 10 minutes.
Under the deck are two powerful 48V Molabo ARIES i50 motors, enabling the electric ferry to hit a top speed of 12 knots. Cruising at its regular operational speed of 5 knots, Ecocat Tres can run efficiently for up to 21 hours on a single charge, making it highly reliable for daily commuters.
Molabo’s motors have a low-voltage setup, which makes them safer to maintain compared to traditional high-voltage electric systems. Passengers also enjoy a smoother, quieter ride thanks to significantly reduced noise and vibrations onboard. Azimut Marine supplied the full propulsion and energy system, which includes two ARIES 50 kW electric drives, 36 batteries providing a total of 216 kWh, fast chargers, and integrated solar panels. Impressively, solar power alone can cover up to 40% of the ferry’s energy needs.
Ecocat Tres will cut around 90 tons of CO2 emissions each year, making a positive impact on Barcelona’s ambitious climate goals.
Port of Barcelona president José Antonio Carbonell said, “This 100% electric, zero-emission passenger ferry is helping us reshape mobility in the port and accelerate the decarbonization of our operations.”
To limit power outages and make your home more resilient, consider going solar with a battery storage system. In order to find a trusted, reliable solar installer near you that offers competitive pricing, check out EnergySage, a free service that makes it easy for you to go solar. They have hundreds of pre-vetted solar installers competing for your business, ensuring you get high-quality solutions and save 20-30% compared to going it alone. Plus, it’s free to use and you won’t get sales calls until you select an installer and you share your phone number with them.
Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisers to help you every step of the way. Get started here. –trusted affiliate link*
FTC: We use income earning auto affiliate links. More.
-
Sports2 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports1 year agoStory injured on diving stop, exits Red Sox game
-
Sports1 year agoGame 1 of WS least-watched in recorded history
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports4 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment2 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Environment2 years agoGame-changing Lectric XPedition launched as affordable electric cargo bike
-
Business3 years agoBank of England’s extraordinary response to government policy is almost unthinkable | Ed Conway