Costs force ABB to abandon offshore converter work

SWITZERLAND: ABB will stop constructing offshore platforms, as part of a new company business model.

The BorWin 1 platform has been particularly problematic
The BorWin 1 platform has been particularly problematic

Speaking about the move, an ABB spokesperson told Windpower Monthly the company had made a loss on a number of offshore wind projects. This was caused by delays and cost overruns relating to the offshore converter platforms.

The decision follows a dramatic fall in earnings for the power systems division, partly caused by project costs for offshore wind transmission systems.

The electrical grid and automation company has extensive experience of installing subsea cables, but is new to the offshore platform business. As such, it will no longer take on the risk involved in their installation.

"We will be bidding for new projects, but we will only offer the parts of the system we are very good at  –  just the cables and the onshore converter platforms," the spokesman said.

However, most project developers require companies to bid for the entire transmission system.

To get around this, ABB will team up with another company on any upcoming transmission tenders. The other company will take on the risk and responsibility for the platform while ABB will handle the cabling.

The spokesman said it has informed developers it will be taking this approach from now on, but added, "whether it will succeed or not remains to be seen".

In its second quarter results presentation the company said that it would be putting "new leadership and mitigation actions in place" to tackle the issues in the division.

ABB has installed the transmission systems for a number of offshore wind farms, largely in German waters.

The BorWin 1 platform, which serves the Bard Offshore 1 project, has proved particularly difficult for ABB. Since the start of the year, the platform has suffered several unplanned outages, and ABB has been responsible for identifying and rectifying the faults.

The company's earnings in the fourth quarter of 2013 were also hit by storms in North Sea, which delayed work on a number of platforms.

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