The Windicator

Stock price performance

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After a dramatically volatile first half year, wind turbine stocks have been relatively stable during the second half of 2009 to date. But absolute performance has been poor. From the middle of June to the end of August, the Windpower Monthly Equity Index of European wind turbine manufacturers declined by 2%, undershooting the Financial Times FTSE Eurofirst 300 Index, which rose by 13%. In India, Suzlon's shares declined by about 20%, significantly underperforming the Bombai Sensex 30 index, which rose by 7% over the period.

Spain's Gamesa was the best performing stock, rising 8% on the back of new broker coverage including a "buy" rating from Citigroup. It recommended on July 20 that investors buy the stock because of "turbine price stability and the likely strength of demand in coming years." Gamesa's first half results were well received by the market. Margins improved, despite lower sales, and the company said it is seeing signs of a recovery in US demand.

High hopes for a rebound in US demand were a feature of most company presentations over the quarter. For Germany's Nordex, shares rose by 6% over the period, boosted by a favorable earnings result at the end of August. The company said it is already assured of reaching its sales target for the year.

Denmark's Vestas had a relatively poor quarter though, with its share price falling by 4% over the period. The stock came under pressure in July with speculation that Vestas would need to downwardly revise its full year targets and declined sharply when one of the company's suppliers, gearbox manufacturer Hansen, cut its full year guidance. When Vestas announced its half year results in mid-August, however, the company maintained its full year forecasts against analyst expectations. But CEO Ditliv Engel said the company will need to "use all our will and determination" to reach projections.

Repower of Germany, owned by India's Suzlon, also performed poorly during the quarter, declining by about 9% between the middle of June and the end of August. First quarter results, announced in late July, contained few surprises, but CEO Per Hornung Pedersen sought to downplay expectations for the current year, while maintaining: "The big picture is still unchanged."

A 23% decline made US firm Clipper the worst performing stock over the period. But the market took heart from the company's statement on first half trading conditions in August, in which it maintained its forecast for improved margins over the year. The stock price rose by 44% over the two trading sessions following the announcement.

Suzlon's stock has performed well for most of this year, more than doubling from the start of the year through to the beginning of June. But the company announced a weaker than expected full year result on June 28, resulting in a 35% decline in the share price over the subsequent two weeks. Its stock price came under pressure again in late July when the company announced it would raise new funds by selling new shares and convertible bonds, and declined sharply after the company announced a first quarter loss on August 1. Analysts seemed to be particularly disappointed about sales volume and the company's order book, which indicated an order pipeline decline of 50% on last year and was only marginally higher than the previous quarter.

As of August 30, data from financial services company Bloomberg indicates that 43% of the 131 broker recommendations on the six publicly listed wind turbine companies were "buy" and 26% were "sell," both more or less unchanged from the previous quarter. The wind sector is steadily gaining attention from analysts, with the total number of recommendations almost tripling in the past four years, from only 47 in 2005 to 131 today. In terms of recommendations on individual companies, Gamesa has come into favour, with the total number of recommendations increasing to 34 from 29 at the end of June, while its proportion of buy recommendations has increased from 41% to 50%.


World wind power capacity increased by nearly 10 GW since the last Windicator (Windpower Monthly, July 2009) and is now 31% higher than at the same time in 2008. Since the start of the year, nearly 18 GW has come online to bring the world total to 138 GW. If the 2009 growth rate is maintained, global wind generating capacity will top 150 GW at the end of the year, an addition of 30 GW compared with 27 GW in 2008. That represents a year-on-year growth rate of 25%, down from last year's 28.7%. Should the wind industry's traditional end-year rush still occur, despite the world financial crisis, 150 GW is a conservative estimate.

By world region, Asia and North America are running neck and neck this year, with Asia's 5668 MW growth just topping that of the US and Canada, which together added 5589 MW (table next page). Europe has so far mustered 5245 MW. By country, the US leads for most wind development so far this year with 5104 MW, followed by China with 4600 MW. The long-awaited surge in Latin America has begun, with nearly 300 MW added in Brazil since the start of the year and 230 MW in Mexico. Offshore this year, wind farms have been completed in Denmark (209 MW) and the UK (194 MW).


Offshore installed costs are running at double those of onshore wind at an average EUR3000/kW, including grid connection. Onshore wind costs look to be settling at around EUR1500/kW, helped by more stable wind turbine prices, though installed costs still vary widely. Business leaders are increasingly beginning to recognise that "wind" is not synonymous with "expensive." At Siemens, the boss of the renewables division, Rene Umlauf, has noted in public that wind plants can already operate without subsidies in New Zealand, are near to profitability in Mexico and Brazil, and are likely to be competitive with other generation in the UK by 2017. Profitability could come sooner, depending on the price trajectories for oil and gas. A senior advisor to the Bank of England, Andrew Sentance, has suggested that global energy prices, currently rising, are likely to rise still further as the world emerges from recession.


In the run-up to December's climate change summit in Copenhagen, governments have been flying their green credentials, not always successfully. President Barack Obama's climate change bill is struggling and could be watered down, though state government initiatives across the US seem likely to sustain the momentum for wind. America could be upstaged by China in the Copenhagen climate change negotiations, especially in wind power. Although the US is just ahead in newly installed megawatts, its percentage growth is well beaten by China, which is running at 37% so far this year, compared with America's 20%.

Supply chain

Despite doubts about the ability of the wind industry's supply chain to keep pace with growth, it has not been a limiting factor: the volume of megawatts installed so far this year indicates the industry is competently firing on all cylinders. The major manufacturers are all reporting substantial order books and new turbine suppliers are appearing, particularly in Asia, with Korean Daewoo Shipbuilding & Marine Engineering the latest big industrial name to enter the business with its purchase of the long-established DeWind technology developed in Germany. Doubts are still expressed about the availability of specialist equipment for offshore wind farms, particularly installation vessels, but with equipment on order and offshore wind plant construction proceeding more slowly than first scheduled, these concerns may not be realised. Forecasts are buoyant for medium to long-term growth.


Nuclear is potentially wind's strongest competitor in the drive to generate carbon-free electricity. It is attracting significant amounts of money for research and development, and planning for new power stations is under way in Canada, Britain, the United States and elsewhere. The World Nuclear Association indicates, however, that growth is likely to be slow until around 2020, after which it may accelerate. By that time offshore wind should be firmly established, putting the two technologies into serious competition for priority access to customers.



Orders for turbines are picking up and the confidence shown by Vestas is not to be ignored. Neither is the dynamism of the offshore wind sector as a mecca for investment. We're feeling about as good as we did last quarter. No change.

Operating wind power capacity

Start Current
2009 Total
Germany 23 903 25 000
Spain 16 740 17 940
Italy 3736 4188
France 3387 4088
UK 3334 3831
Denmark 3180 3393
Portugal 2833 3335
Netherlands 2216 2220
Ireland 1053 1166
Greece 985 1063
Sweden 1021 1021
Austria 995 995
Poland 405 530
Turkey 383 523
Norway 436 436
Belgium 384 384
Hungary 127 177
Bulgaria 158 176
Finland 143 147
Czech Republic 133 133
Estonia 78 117
Ukraine 90 90
Lithuania 52 52
Luxembourg 35 35
Latvia 27 27
Croatia 17 27
Switzerland 14 14
Romania 10 12
Russia 11 11
Slovakia 3 3
Total 65 889 71 134
Japan 1540 1953
Australia 1306 1476
New Zealand 468 468
Philippines 33 33
Pacific Islands 24 24
Total 3371 3954
Brazil 336 634
Mexico 88 316
Costa Rica 92 92
Caribbean 57 57
Chile 20 38
Argentina 30 30
Colombia 20 20
Uruguay 18 18
Cuba 7 7
Ecuador 2 2
Peru 1 1
Falkland Islands 1 1
Total 672 1216
Canada 2369 2854
Total 2369 2854
Texas 7314 8675
Iowa 2810 3043
California 2517 2787
Minnesota 1752 1802
Oregon 1067 1585
Washington 1375 1567
New York 832 1274
Illinois 915 1116
Colorado 1067 1067
Kansas 815 1014
Wyoming 676 944
Oklahoma 708 831
North Dakota 714 714
Pennsylvania 361 595
Indiana 131 531
New Mexico 497 497
Wisconsin 395 449
Montana 272 375
West Virginia 330 330
Missouri 163 309
South Dakota 187 288
Nebraska 73 153
Idaho 75 147
Michigan 129 129
Maine 47 104
Hawaii 63 63
Tennessee 29 29
New Hampshire 25 25
Utah 20 20
New Jersey 8 8
Ohio 7 7
Vermont 6 6
Massachusetts 5 5
Alaska 2 2
Rhode Island 1 1
Total 25 388 30 492
China 12 200 16 771
India 9645 10 742
South Korea 233 233
Taiwan 224 224
Sri Lanka 3 3
Bangladesh 1 1
Total 22 306 27 974
Egypt 365 431
Morocco 134 253
Iran 67 67
Tunisia 54 54
Reunion (France) 10 10
South Africa 9 9
Israel 6 6
Cape Verde 3 3
Jordan 2 2
Total 650 835
(c) Windpower Monthly News Magazine

About the windicator: The quarterly Windicator is an indicator of the state of play. Changes in country totals in the table can be corrections received rather than additions or subtractions. We welcome corrections. The column is compiled by Windpower Monthly contributors Stephen Barker (share prices), David Milborrow (development and economics) and in-house staff. US MW total based on AWEA data and German MW based on Betreiber-Datenbasis data. (c) Windpower Monthly News Magazine

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