The wind power industry has demonstrated it can be ‘relied upon in difficult times’ as some of its leading lights revealed how big firms are managing to navigate the turbulence sparked by the global pandemic.
The CEOs of manufacturers, developers and the Green Investment Group discussed the industry’s robust response to the impact of Covid-19, at the Accelerating deployment: volumes, auction design, permitting session at the WindEurope Hamburg virtual event
Facing concerns that wind’s supply chain would have been heavily disrupted by the global pandemic, WindEurope’s newly elected chairman and Siemens Gamesa Renewable Energy CEO Andreas Nauen, said: “I shared the view of the fear at the beginning of the Covid-19 crisis, but I think the whole industry proved that we were pretty resilient.”
Nauen said that, for SGRE, the robust response started with its customers, the onshore and offshore developers operating the wind farms and the support from service teams.
He said: “We could clearly keep spinning and generating electricity. On the other hand, we did indeed have some hiccups in the supply chain, but these were not fundamental, and all of us could keep going on our production and installation work. Sending people onto vessels to install offshore. We have shown we can keep our turbines spinning that’s good overall for the future.”
He said that Covid-19 had "clearly emphasised" the need for a European energy supply, adding that he was hopeful that the Green Deal and the support package defined by Brussels and national governments will mean the sector comes out of the crisis even stronger than it went in.
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Vestas chief Henrik Andersen offered his thoughts on the expectations of policymakers around infrastructure, saying that the sector has proved it could be counted on in a crisis.
Andersen said: “Throughout 2020 the industry has had the opportunity to evidence that we could be relied on in difficult times. I think that also goes hand in hand with allowing policymakers to lean forward and put up ambitious targets.”
The EU was first off the block in terms of the green agenda, a move that is now being followed by others globally, he said, adding: “Now it comes to how do we fulfil some of the targets (of the Green Deal) and put tangibles to it. This is where I think the whole industry and the whole value chain needs to come closer together with politicians, to fulfil some of these [targets]. Because right now I think we are struggling, just a little bit, to actually get some tangible measures together to get it off the ground.
“Right now people like to talk about the big stuff and the big dreams in 2050 rather than what is going to happen in the first five years. We have a whole young generation that looks at us and is saying, ‘Well if you can’t even fix the start of it, how do we dare to think and believe in 2050?’.
“I think the good thing is it is spreading to other countries like Japan, South Korea, China and others. And I think that you could hope [the pandemic] has actually led to a more global, unified environment because that will then drive a very different, underlying setting.”
We can still ‘do our deals’
Despite the lack of certainty, the wind industry has remained “remarkably resilient” in the face of the pandemic, according to Mark Dooley Global head of the Green Investment Group.
In the first half of the year, individual projects were still following through with the momentum that they took into the crisis, Dooley said, adding: “They did something quite remarkable in the circumstances to make sure that their projects were still achieving financial closing and went into construction. That’s very impressive.
“It feels like we are in a different phase now. The wind industry has shown that under the constraints of Covid, it can still make projects happen. The supply chain is still there. We are finding ways to make projects actually happen on-site, with little challenges, but to everyone’s credit, projects are still being executed.”
He said it was “encouraging” that governments had not withdrawn support from the green agenda in difficult circumstances and, in fact, were ramping up efforts.
Debt markets are now more or less where they were before Covid-19 struck, Doley said, adding that pricing and liquidity support for deals in the sector remained largely the same.
He said: “There is still work to be done in those markets where you have got a higher merchant risk component.
“Broadly speaking we know we can find the debt to do our deals and certainly the equity support from sponsors and the wider, deeper infrastructure markets is strongly there for this asset class.
“It feels to me that things are set well for us to continue to be able to execute wind projects into the future. Certainly, for us, we are closing across all renewables assets classes. I think wind is particularly resilient because it is at a scale, familiarity and confidence that attracts all capital providers to the sector.”
Guidelines on working safely
Lindsay McQuade, CEO of ScottishPower said the firm’s plans had also been affected by Covid, agreeing that while there had been resilience, there were also challenges in supply and personnel.
McQuade said: “This year has not been normal by any stretch of the imagination and I think when I sat with my management team back in January, none of us would have foreseen the challenges we have seen throughout the last ten months or so.”
The response across the industry and the support it has received has been impressive, she said, adding: “There have been interruptions, as others have commented on. Yes, there was an interruption in the supply chain.
“You could gradually see it coming east to west as time went on, and that had affected our operations to a minimal extent, as some key parts were not necessarily available when we needed them, or there was some displacement of personnel, but nothing that was insurmountable.”
As chair of the SafetyOn onshore wind health and safety group in the UK, McQuade said the industry came together to develop guidelines so staff could continue working safely despite restrictions, while progress was made on committed investments that ScottishPower had agreed to deliver this year.
“By and large that’s happened, which is really pleasing,” she said.