Siemens Gamesa demands Europe-wide action to safeguard wind industry

European energy independence in "imminent danger" as wind turbine manufacturers suffer massive losses while China profits from "unfair advantage", warns white paper

"Without intervention and cooperation, the energy transition in Europe will become unattainable,” warns SGRE chief Jochen Eickholt (pic credit: Siemens)
"Without intervention and cooperation, the energy transition in Europe will become unattainable,” warns SGRE chief Jochen Eickholt (pic credit: Siemens)

European governments need to "act swiftly" to guarantee the wind industry is treated as a strategic industry, says Siemens Gamesa Renewable Energy (SGRE), warning that European energy independence will be "impossible" without securing the wind industry and its supply chains. 

"Wind turbine manufacturers are operating at massive losses and cannot invest to satisfy growing demands for wind energy," warns the company, which itself has suffered such heavy losses that it is now subject to a €4 billion rescue takeover bid by its parent company, Siemens Energy.

SGRE has published a white paper called Europe’s energy sovereignty is in imminent danger: why we need the European wind industry – and how to safeguard it. 
It calls for the wind sector as a whole to be declared an industry of strategic importance, in order to be able to instigate the technology and capacity necessary to deliver the European green deal.

The sector’s ability to be profitable is "currently threatened by auctions solely driven by price, slow permitting and, ultimately, soaring prices for energy, commodities and transport", says SGRE. The pandemic also resulted in a scarcity of key components for wind turbines, while Russia’s war of aggression against Ukraine worsened supply chain issues, it adds.

"Without intervention and cooperation among governments, manufacturers and suppliers, the energy transition here in Europe will become unattainable and Europe will lose its position as a global leader in the wind industry," warned Siemens Gamesa CEO Jochen Eickholt.  "The implications for European countries, and the rest of the world, are obvious. We urge regulators to take on board the five imperatives detailed in this white paper, and to work with us to deliver them. Without these safeguards, Europe’s energy independence is impossible.”

Action plan

The white paper suggests key measures to be implemented at a Europe-wide level to address the current challenges and help the wind industry deliver the green energy transition:

  • Accelerate approval times for wind project permits and establish a visible project-pipeline – with at least five years of upfront visibility on auction volumes – for manufacturers and suppliers to load existing factories, and plan for new capacities. 

  • Manage price risks and stabilise supply chains while compensating for inflation rises. Governments can do this, according to the paper, by making sure contracts offset the effects of high inflation and by providing support where price increases cannot be absorbed.
    "To prevail among global competition, Europe must enable materials to be procured at competitive costs," it adds. "This can be done by stabilising raw material and pre-production supply chains through diversification. Governments can support this effort via energy and commodity partnerships and trade agreements. Wind turbine manufacturers can contribute to this effort by standardising required products, diversifying international supply chains and strengthening the European industry to allow a shift to a “made in Europe” strategy."
  • Support domestic innovation and foster technology competence. SGRE is calling on governments to get qualitative, not just quantitative, criteria correct in auctions. "Energy security cannot be achieved through auctions solely based on price", it says. Auction designs should be adapted to include up to 30% qualitative criteria in competitive wind energy auctions, without imposing additional costs on developers, since such costs are ultimately passed on to the supply chain and consumers.

The China factor

China's dominance in the sector is a key focus for SGRE's paper. "China has an unfair advantage in the wind turbine industry
," it says. "Higher quantities – 51% of total wind market installations in 2021, according to the Global Wind Energy Council – and a different market model enable Chinese companies to offer their wind energy technology at very competitive prices. Meanwhile, western wind turbine manufacturers are excluded from the domestic growth in China by regulations or differing operating models."

A level playing field should therefore be established across Europe to "protect the European wind industry" over the long term, SGRE says. "This can be done through trade and/or fiscal policy instruments that would offset subsidies from other countries or through strict requirements in pre-qualification and participation conditions for tenders."

Such actions should be taken at the European level, not at the local EU member level, to preserve economies of scale for those manufacturers with a global presence. Notably, SGRE wants European leaders to address Chinese investments in critical energy infrastructure and discuss European energy security from a technological point of view and with regard to wind turbines.

It warns: "Should investment decisions in Europe be taken only from a cost-per-wind-turbine perspective, the strengthening of low-cost competition from China will lead to more than just a significant weakening of the European wind industry. The resulting additional price pressure would most likely lead to further reductions in innovation, know-how and jobs in the EU. Governments should take care to avoid a repeat of what happened across the European solar industry.

Lastly, the wind industry should be considered to be of strategic importance, the paper says, so governments should "invest today to secure its stability well into the future". 


Coordinated action on an EU, international, national and regional basis will be required, the paper SGRE stresses. "Successful implementation will deliver clean energy, GDP growth, a continuation of technological leadership within Europe and long-term employment for hundreds of thousands of European citizens."

The paper notes that the EU wind energy sector currently supports more than 300,000 jobs, contributes €37 billion to the EU’s GDP and generates €5 billion in local taxes every year. Five of the world’s top ten wind turbine manufacturers are European, earning a collective 42% global market share. And, each new wind turbine installed in Europe adds €10 million of economic activity, it says.

The paper warns there is "little time left to initiate the necessary steps" but "with decisive leadership and swift action, the tipping point may yet be avoided".

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