United States

United States

Siemens Gamesa seeks $90,000 per installed MW from GE for Ocean Wind 1

Siemens Gamesa is seeking a royalty of no less than $90,000/installed megawatt for GE’s Haliade-X turbines at the 1.1-GW Ocean Wind 1 offshore project in the ongoing patent dispute between SGRE and GE.

Boston District Court's Judge William Young is presiding over the patent dispute (Image provided by the U.S. District Court for the District of Massachusetts)
Boston District Court's Judge William Young is presiding over the patent dispute (Image provided by the U.S. District Court for the District of Massachusetts)

This figure emerged in a hearing today at the US District Court in Boston, although the judge has yet to rule on the royalties.

GE is seeking $30,000/installed megawatt, the same amount that a jury awarded to Siemens Gamesa for Vineyard 1.

Both projects are being carved out of a court-ordered injunction of the Haliade-X which was imposed because it infringes Siemens Gamesa’s intellectual property.

The court is considering “an appropriate exemplary royalty rate” for Haliade-Xs installed at Ocean Wind 1 off New Jersey.

Ocean Wind 1, developed by Ørsted and US utility PSEG, was due online in 2025.

But lawyers for Siemens Gamesa in the hearing cited court documents, filed by the State of New Jersey, which state that the timing of Ocean Wind 1 is now up in the air.

“Ocean Wind’s timing is now out the window,” a Siemens Gamesa lawyer told Judge William Young.

“If an income stream [for GE] is now very iffy, then I ought to be cautious,” said the senior judge in response. He also said the court eschews an independent evaluation of the appropriate royalty.

Profit and loss

During the hearing, Siemens Gamesa lawyers said that GE was to make $230,000 profit per installed megawatt for the 1.1GW Ocean Wind project.

This was according to a brief filed with the court by Ørsted, whose officials attended the hearing but were not permitted to speak.

According to Ørsted’s brief, GE is facing a 14% reduction in profit to $197,000/installed megawatt because of the patent dispute, said Siemens Gamesa’s lawyer.

Siemens Gamesa said the $90,000 royalty was justified because GE was not only installing the infringing Haliade-X in the US, but also importing it and may manufacture it in the US.

Siemens Gamesa’s legal team asked for an immediate payment of royalties, citing that Orsted’s brief said it had already paid GE $120 million for Haliade-X turbines.

GE’s lawyers noted that the jury found the company did not wilfully infringe the technology of Siemens Gamesa or that the rival firm lost profits.

“There is no reason to treat Ocean Wind differently from Vineyard,” said a GE lawyer.

“SGRE’s seeking a higher royalty because of importation and manufacturing as well as installation is SGRE wrongly seeking a ‘double recovery,” said GE’s lawyer.

After a trial in June, a jury found that the Haliade-X infringes Siemens Gamesa’s patent no 9,279,413 — the ‘413 — for an offshore direct-drive turbine’s structural support mechanism, and the physical and structural arrangement of the main shaft bearings.

In a dramatic and rare move, the court also imposed a permanent injunction on the Haliade X in the US.

GE unveiled a work-around of the infringed technology yesterday. The Haliade-X-ii lacks a bearing within the interior of a rotor hub’s hollow shell, according to GE court documents filed with the US District Court on 17 October.

Specifically, the bearing is outside of the interior of the rotor hub’s hollow shell - a design that GE says is “prior art”.

The other design - the Haliade-X-iii – is for a next-generation of Haliade-X turbines, which also avoids the patented technology, said GE.

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