United States

United States

GE Renewable Energy's losses widen

Losses in GE's Renewable Energy division increased to $184 million in the second quarter of 2019, mainly due to legacy joint venture costs and research and development (R&D) spending.

GE's 12MW Haliade-X (nacelle, pictured above) is due for prototype testing in Rotterdam in the Netherlands
GE's 12MW Haliade-X (nacelle, pictured above) is due for prototype testing in Rotterdam in the Netherlands

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The segment’s losses were more than the $162 million loss in the previous quarter, despite higher revenue and orders between April and June.

It received orders worth $3.7 billion in Q2 2019 up 35% year on year. Revenues were also recorded at $3.6 billion — up 26% year on year.

GE explained "joint venture consolidation, higher losses on legacy contracts, challenging onshore project execution in Asia Pacific, increased R&D investment, tariffs and pricing" drove a loss in the Renewable Energy unit.

It reported similar pressures in the first quarter of 2019.

GE made losses of $285 million on legacy projects in Q2 2019, including consolidation of Alstom’s power and grid business, which it acquired in 2015.

It also reported $66 million losses due to project execution and spent $49 million on R&D in the second quarter of 2019.

For onshore wind, GE plans to "maximise the US PTC (production tax credit) cycle" ahead of the planned phase-out of the US clean energy support scheme and focus on project execution, quality and execution on price and cost.

GE’s Renewable Energy CEO unit Jérôme Pécresse said the company expected a "good level of activity for 2021 projects in the US despite the lower value of production tax incentives".

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