Wind turbines hit a speed bump

The Economist recently wrote about the struggles the wind turbine market is experiencing this year after a banner year in 2009. A slowdown in the US, difficult credit markets and European nations reaching their renewable energy targets have all been contributing factors to this decline.  

Inaction by the American government to curb greenhouse gas emissions could also affect industry growth. 

In America, meanwhile, a proposed cap-and-trade bill got nowhere this year. New wind installations are likely to remain lower than last year’s for the next five to ten years, predict analysts at HSBC and Bernstein Research. 

Over the long-term the future of wind power appears to lie with the larger firms. 

Amid the gloom, however, is some respite for the biggest manufacturers. During the boom of the past five years there was a proliferation of small manufacturers and a fragmentation of the market. The market share of Vestas, for instance, slipped from 28% in 2005 to 15% last year. In these leaner times, buyers in Europe and America are placing orders mainly with the biggest firms, since they seem less likely to go bust. 

Identifying which wind firms are likely to succeed in the coming decade will be a challenge for green investors. As conventional energy supplies become more limited, however, investing in industry leaders could prove profitable. 

Read Economist Article: Wild is the wind: Wind power is in the doldrums

We're sorry, but comments are closed.

Leave a Comment