MHI Vestas advances Taiwanese supply chain

TAIWAN: MHI Vestas has committed to local manufacturing of turbine towers and establishing a company office in the budding offshore wind market.

MHI Vestas co-CEO Lars Bondo Krogsgaard and CS Wind co-CEO Knud Bjarne Hansen (centre-left and -right respectively) after signing the agreement

It signed a conditional contract with tower-providers CS Wind and metal forming firm Chin Fong for the production of towers in Taiwan.

The manufacturer also announced it would co-locate a new subsidiary, MHI Vestas Taiwan, at its parent company MHI’s office in the capital city of Taipei.

MHI Vestas signed a further localisation agreement with Copenhagen Infrastructure Partners (CIP) to provide "substantial", but unspecified, financial backing to the tower pact with CS Wind and Chin Fong.

It is in line to provide 900MW of turbines to CIP for its first three offshore wind projects off the coast of Taiwan.

The Japanese-Danish company’s co-CEO Lars Bondo Krogsgaard, said: "Our activities this week underscore our strong commitment to the Taiwan offshore wind market and the build-up of a local supply chain."

In March, MHI Vestas signed a preferred supplier agreement with CIP for the investment firm’s projects in Taiwan.

That same month, it also signed memorandums of understanding (MoUs) with four Taiwanese companies in an effort to source local content for its turbines.

Under the agreements, China Steel Manufacturing Corporations would provide towers, Tien Li would produce blades, and Swancor and Formosa Plastics Corporations would both supply composites and resins.

It is unclear whether these agreements still stand.

CIP was awarded grid capacity for 900MW across three projects in April.

Its 552MW Zhang Fang project will be connected between 2021 and 2023, 48MW of its 480MW Westland site will be connected by 2024, and 300MW of its 480MW Zhong Neng project — which it owns with China Steel Corporation — will be connected in 2024.

Locally produced towers are mandatory for the projects being completed in 2021, MHI Vestas stated.

The agreement with CIP also "formalises commitments" for wind farms being connected in 2023 and 2024, it added.

Other foreign companies are also building local supply arrangements as Taiwan’s offshore wind market prepares for launch. 

Siemens Gamesa signed supply agreements with three companies for locally-produced towers and resin used in blades plus MoUs with ten companies involved in the south-east Asian country’s offshore supply chain.