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Australian and Spanish ventures -- Getting footholds in China

The approval of China's renewable energy law has seen a flurry of activity by international wind power companies seeking to get a stronghold in the market. Project developers Acciona of Spain and Australia's Hydro Tasmania have both signed co-operation agreements with Chinese companies, while wind turbine makers Gamesa Eólica and GE Energy made announcements last month of their activities in China.

Acciona's joint venture is with state-owned China Aerospace Science and Technology Corporation (CASC) and Sino-Spanish trader Inceisa. Acciona and CASC will each hold a 45% share in the venture, with Inceisa taking 10%. A turbine manufacturing facility is to be built in the city of Nantong, with capacity to produce 600 MW of wind turbines a year, ramping up to 800 MW later.

The Nantong factory will assemble 1.5 MW turbines from Acciona affiliate, Ingetur, which Acciona acquired when it bought Spanish renewables developer EHN (Windpower Monthly, March 2005). The EUR 25 million factory -- which will be the biggest of its kind in China -- is due to be operational by the end of the year. Turbines will be produced for use in China and for export to other Asian markets. Until now, Ingetur has only made turbines at its Spanish facility in Navarra. Its first full year of manufacturing was in 2004 when the company turned out 143 machines.

The Acciona agreement means Ingetur could start turbine production in China before Vestas and Gamesa. Both have said they will launch Chinese operations. Flagging up its interest in China, Gamesa reports a EUR 10 million order from Ningxia Electric Power Group to supply 24, 850 kW turbines for an extension of the 52.25 Helanshan Wind Farm in the province of Ningxia. The wind farm is made up of 65, 850 kW turbines, five from Vestas and the rest from Gamesa. Towers will be produced locally. The order brings Gamesa's sales in China to 230 MW.

No sooner had Gamesa released its news than GE Energy reported that by October it would complete the 34.5 MW Shangyi Manjing Wind Farm in Hebei province for the Guohua Energy Corp, a subsidiary of the Guohua Energy Corp, using 1.5 MW machines. GE says it has orders for 47 turbines in China.

Hydro Tasmania

Australian developer Hydro Tasmania has signed a co-operative agreement with Chinese energy company Datang to investigate renewable energy potential in China's Jilin province, particularly for development of a 50 MW wind farm, says Hydro Tasmania's David Crean. Datang Jilin is a provincial subsidiary of Datang Corporation, one of five major generators owned by China's government. Jilin province is in the north-east of China.

Hydro Tasmania has several projects totalling over 200 MW under development in Tasmania and South Australia. But with no certainty that the Australian wind market will continue beyond 2008 under current legislation, Hydro Tasmania is keen to explore other markets. "China has a much longer term renewable development objective," Crean says.

Tasmanian energy minister Bryan Green says he understands Hydro Tasmania's decision to look overseas. The federal government is driving renewables investment out of Australia, he says, by not extending the Mandatory Renewable Energy Target. "It's only natural that companies like Hydro Tasmania are having to look overseas for growth opportunities," he says.

China is aiming for renewables to meet 10% of the country's energy supply by 2020 (Windpower Monthly, April 2005). The renewables law takes force in January 2006.

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