India is one of the fastest growing wind power markets in the Asia-Pacific region’
India is one of the fastest growing wind power markets in the Asia-Pacific region’
Ditlev Engel took over as president and chief executive officer (CEO) of the 3.5 billion euro Vestas Wind Systems A/S, Denmark, in 2005. Vestas is world’s largest wind turbine manufacturing company with operations across the globe. His long-term action plan aims for a global market share of at least 35%. Vestas has its India connection through a joint venture, Vestas RRB India Ltd. As part of its global acquisition, the Chennai-based NEG-Micon India became a 100% subsidiary of Vestas. After divesting stake in Vestas RRB, this subsidiary company is now rechristened Vestas Technologies India Pvt Ltd. It has been made part of the global manufacturing operations of Vestas. Engel, who was in India recently, spoke to Joseph Vackayil of The Financial Express about Vestas’ global strategies and their bearing on Indian wind industry. Excerpts:
Wind power has not been given the importance it deserves across the world. Do you see that changing?
Wind power is the most successful and viable answer to global warming and other carbon emission-related environmental hazards.
What appears for most people as an endless horizon is an endless potential for us. Compare Denmark with the world. Already, 22% of its total energy capacity comes from wind. The world average is just 0.7%.
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On a December evening in Denmark, when power consumption was at its peak, it was metered that 34% of the total energy used was from wind.
There is enormous potential and an urgent need to generate electricity from wind. The only energy source with the potential to go along with and be complimentary to oil and gas is wind. Wind power is a real and very competitive alternative to oil and gas. There are cars in the market that run on wind-generated electricity. Cars and homes and factories can run on wind.
Wind is going to be part of the energy portfolio through integration with the grid system of power utilities. We want to make this possible everywhere in the world.
What policy support does Vestas expect from the government?
As a global player, we do not comment on an individual country’s policy framework. But one aspect we highlight everywhere is the importance of looking at the life-cycle cost of energy.
When cost is estimated from all aspects — not just the primary and apparent — the economic, social and environmental cost and benefits have to be taken into account.
A 3mw Vestas wind turbine in its life of 20 years would prevent over 2.33 lakh tonnes of carbon dioxide emission. It is a very important cost saving to the world and humanity. Wind power systems are easy and fast to install. There is no gestation period.
When the cost of energy is calculated on this basis, wind power would become — if not cheaper — at least equal to conventional energy sources. Technology will make it more dependable, too.
Will bio fuels be a challenge to wind power?
There is no question of competition between energy sources. We have to tap all forms of energy. The world population is increasing. Development and GDP growth is directly linked to energy consumption. Environment-friendly energy sources are essential for all-round economic development of any country. The research focus in India is to upgrade turbines to suit the wind patterns in the country.
What is your vision for Vestas?
Vestas’ vision is technology-driven conversion of wind to grid-connected power for which the potential is unlimited.
Our long-term target is a global market share of at least 35% in mw-installed capacity. During the coming three years, we will primarily focus on the improvement of the profit margin. This does not imply that we have rejected growth — it just has to be profitable. If growth is profitable, we certainly wish to grow on an ongoing basis. In order to secure our long-term financial targets, a number of initiatives have been started to improve Vestas’ operational profitability.
Could you elaborate on these operational initiatives?
The major initiatives include considerable increase in technology development to strengthen global competitiveness and to re-establish a higher level of customer satisfaction. Better technology will reduce the cost of warranty repairs through a closer strategic partnership with sub-suppliers who share our quality perception.
Cost reduction in direct production can be achieved by improving the process organisation and supplier structure. Enhancing the efficiency and simplification of the group’s organisation will reduce indirect production and capacity costs. Cost savings will lead to staff reduction and avoid administrative double function.
Any plan to relocate manufacturing to cut costs?
We have manufacturing facilities in all predominant market regions. We will continue with them.
There will be strategic sourcing of turbines from different places. Our Indian subsidiary will manufacture 1.65mw turbines for global supply. India is also a major R&D centre for Vestas.
What are Vestas’ plans for India?
In 2005, Vestas had 27% share of new capacity installations in India. We want to grow in a big way in India. It is one of the fastest growing economies in the world. It is one of the fastest growing wind power markets in the Asia-Pacific region.
The potential for wind power, assessed to be of 1,00,000mw, is very large. Only a fraction of this has been utilised for power generation. Our focus will be on the manufacture of 1.65 mw turbines. As the market demand grows, a higher capacity turbine will be introduced.
India is one of the fastest growing wind power markets in the Asia-Pacific region’
Ditlev Engel took over as president and chief executive officer (CEO) of the 3.5 billion euro Vestas Wind Systems A/S, Denmark, in 2005. Vestas is world’s largest wind turbine manufacturing company with operations across the globe. His long-term action plan aims for a global market share of at least 35%. Vestas has its India connection through a joint venture, Vestas RRB India Ltd. As part of its global acquisition, the Chennai-based NEG-Micon India became a 100% subsidiary of Vestas. After divesting stake in Vestas RRB, this subsidiary company is now rechristened Vestas Technologies India Pvt Ltd. It has been made part of the global manufacturing operations of Vestas. Engel, who was in India recently, spoke to Joseph Vackayil of The Financial Express about Vestas’ global strategies and their bearing on Indian wind industry. Excerpts:
Wind power has not been given the importance it deserves across the world. Do you see that changing?
Wind power is the most successful and viable answer to global warming and other carbon emission-related environmental hazards.
What appears for most people as an endless horizon is an endless potential for us. Compare Denmark with the world. Already, 22% of its total energy capacity comes from wind. The world average is just 0.7%.
Ads By Google
Finance News Online
Read The Economist Online: Insight & Opinion On Financial News
Economist.com
IBM Business Solutions
Distinguish Your Business w/ IBM's Innovative Ideas & Tech. Get Info.
www.IBM.com
Wind Energy Safety
A report detailing Iberdrola and CEI’s Princeton’s wind site
www.princetonwindfarm.com
Stock Markets
Professional Stock Charting & Analysis. Stock Prices Online!
www.SaxoBank.com
On a December evening in Denmark, when power consumption was at its peak, it was metered that 34% of the total energy used was from wind.
There is enormous potential and an urgent need to generate electricity from wind. The only energy source with the potential to go along with and be complimentary to oil and gas is wind. Wind power is a real and very competitive alternative to oil and gas. There are cars in the market that run on wind-generated electricity. Cars and homes and factories can run on wind.
Wind is going to be part of the energy portfolio through integration with the grid system of power utilities. We want to make this possible everywhere in the world.
What policy support does Vestas expect from the government?
As a global player, we do not comment on an individual country’s policy framework. But one aspect we highlight everywhere is the importance of looking at the life-cycle cost of energy.
When cost is estimated from all aspects — not just the primary and apparent — the economic, social and environmental cost and benefits have to be taken into account.
A 3mw Vestas wind turbine in its life of 20 years would prevent over 2.33 lakh tonnes of carbon dioxide emission. It is a very important cost saving to the world and humanity. Wind power systems are easy and fast to install. There is no gestation period.
When the cost of energy is calculated on this basis, wind power would become — if not cheaper — at least equal to conventional energy sources. Technology will make it more dependable, too.
Will bio fuels be a challenge to wind power?
There is no question of competition between energy sources. We have to tap all forms of energy. The world population is increasing. Development and GDP growth is directly linked to energy consumption. Environment-friendly energy sources are essential for all-round economic development of any country. The research focus in India is to upgrade turbines to suit the wind patterns in the country.
What is your vision for Vestas?
Vestas’ vision is technology-driven conversion of wind to grid-connected power for which the potential is unlimited.
Our long-term target is a global market share of at least 35% in mw-installed capacity. During the coming three years, we will primarily focus on the improvement of the profit margin. This does not imply that we have rejected growth — it just has to be profitable. If growth is profitable, we certainly wish to grow on an ongoing basis. In order to secure our long-term financial targets, a number of initiatives have been started to improve Vestas’ operational profitability.
Could you elaborate on these operational initiatives?
The major initiatives include considerable increase in technology development to strengthen global competitiveness and to re-establish a higher level of customer satisfaction. Better technology will reduce the cost of warranty repairs through a closer strategic partnership with sub-suppliers who share our quality perception.
Cost reduction in direct production can be achieved by improving the process organisation and supplier structure. Enhancing the efficiency and simplification of the group’s organisation will reduce indirect production and capacity costs. Cost savings will lead to staff reduction and avoid administrative double function.
Any plan to relocate manufacturing to cut costs?
We have manufacturing facilities in all predominant market regions. We will continue with them.
There will be strategic sourcing of turbines from different places. Our Indian subsidiary will manufacture 1.65mw turbines for global supply. India is also a major R&D centre for Vestas.
What are Vestas’ plans for India?
In 2005, Vestas had 27% share of new capacity installations in India. We want to grow in a big way in India. It is one of the fastest growing economies in the world. It is one of the fastest growing wind power markets in the Asia-Pacific region.
The potential for wind power, assessed to be of 1,00,000mw, is very large. Only a fraction of this has been utilised for power generation. Our focus will be on the manufacture of 1.65 mw turbines. As the market demand grows, a higher capacity turbine will be introduced.