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IntelStor Insights into Wind Turbine Blade O&M Costs
Phil Totaro, CEO of IntelStor, dives deep into the latest trends and data surrounding onshore wind turbine blade operations and maintenance costs. He discusses the strategies and innovations being employed to optimize blade performance, reduce downtime, and drive down costs.
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Allen Hall: Welcome to the Uptime Wind Energy Podcast. I’m your host, Allen Hall. As the wind energy industry continues to grow and mature, the focus on reducing costs and improving efficiency has never Been more important. Operations and maintenance costs can account for a significant portion of the total cost of energy production, making it a critical area of concern for wind farm operators and energy users alike.
In this episode, Phil Totaro, CEO and founder of IntelStor, will share the latest data and trends related to Onshore Wind Turbine Blade Operations and maintenance costs, which everybody’s wondering about is going to provide some valuable insights into the current state of the blade industry and how we manage blades.
You also discussed some of the strategies, innovations being employed to optimize blade performance, reduce downtime, and ultimately. Drive down costs, so whether you’re a wind farm operator, an energy user, or just simply interested in the future of renewable energy, this is an episode you won’t want to miss.
Welcome again. Thanks, Allen. Thanks for having me. So the IntelStor report you just published, and there’s some news about it on LinkedIn, is really fascinating because Joel and I have been wandering around Oklahoma and Texas and other parts of the country looking at blades. And there is a lot of concern.
About the costs associated with damaged blades and how to forecast that and how to appropriately budget for them, particularly in terms of all the new types of blades that are being introduced, the bigger generators, the three megawatts, the four megawatts, the six megawatt machines versus the one and a half and two megawatts that we’re kind of used to it becomes really a guessing game for a lot of operators because they don’t have a sense of How much is it going to cost me to operate this turbine, and how do I manage that, and how do I appropriately schedule my technicians?
Like, how many technicians do I need for a season? These are subjects that come up all the time, and, and if you’ve been around anywhere in Canada or the United States over the last year, there’s so much more talk about it now. And this is where your new tool comes in, your Onshore tool. Basically estimator or looking at turbine size versus the types of damage a blade may suffer.
Phil, will you, will you walk us through what this tool is at the top
Philip Totaro: level? Sure. Of course. So, What we have been repeatedly getting asked about is, for the ISPs we work with, they want to understand the, a detailed market forecast. And the only way to get to a detailed market forecast is, we obviously know based on the work that we already do, how much capacity we’re expecting to be installed.
And that’s not based on like estimates, that’s based on actual pipeline of turbines. And so we know in markets like the United States or Brazil, where, there’s reasonably good detailed publication of those turbine sizes, we, we’ve built out that, that pipeline. But what we then needed to do was determine, all right, how many of those units are going to be online within the next, 10 years or so?
What’s the, most importantly, what are the top kind of failure modes? And then what’s the probability and, and kind of the annual failure rate for each one of those type of failure modes on the turbine as a whole. And then we started looking at blades in particular because it, as it turns out, most people will recall either anecdotally or through some previously published information that gearboxes were probably the most expensive.
Item in terms of downtime that you could have on a smaller turbine. But as we go bigger the gearboxes and generators have actually become more slightly more reliable. You still have, your, your periodic faults and failures. But they’ve developed a lot of technology through either modularization or other up tower cranes and things like that that allow you to service gearboxes, generators, etc.
in situ. Blades, if you’ve got a major issue, you probably still need to take it down. And that can either involve a single blade swap kind of, crane mechanism or a big crane. And it’s basically all that said, what’s happening now with bigger turbines is the bigger the turbines go, the The more cost is involved because of the amount of repair time and the crane cost associated with undertaking that type of repair.
So as compared to gearboxes or generators or pitch systems and, and maybe main bearings that used to be like the, the biggest causes of, O& M expense and, and the biggest impact on downtime. Blades are now kind of, unfortunately, taking the, the lead. And I guess right up your alley, lightning is probably still, like, one of the number one causes of both minor repairs and major.
Repairs and replacements.
Allen Hall: Yeah, so we’re seeing the, the common faults that existed on the one and a half megawatt machines and two megawatt machines when they move up to three and four megawatt machines. They didn’t always require a crane. Pretty much when you get to three megawatts, four megawatts, you’re going to require a crane from most of the, the major items.
Any sort of trailing edge bond line on the back end to lightning damage to any, anything internal. Boy, it just seems like there’s a real risk reward to using a larger turbine at the minute. And, and that’s where I think this data is very interesting because we, we are moving away from the one megawatt machines.
We obviously we’re kind of the one and a half to two range at the moment. Right. And then we’re going to be in the threes. What does that mean in terms of operational costs? What do we need to be planning for here? Do we need to be ordering more cranes? Do we need to have other plans
Philip Totaro: to deal with this? So there’s a couple of things at play here.
One is Besides lightning damage, one of the number one expenditures that you’re going to have is actually been a fatigue failure in the route. That’s again, according to the data we’ve got, as far as the probability of occurrence and, and the annual failure rate, that’s one of the highest impact repairs that you’re going to have.
Again, besides lightning damage and followed closely by transportation damage, which, unfortunately, transportation damage is just kind of part of the cost of doing business, so to speak. But it can, it can vary. You can get to site and notice that you’ve got a few little things, maybe in the chips in the top coat that you just need to fix, or you could actually have some some severe issues with leading or trailing edge cracking or other things, you might get to site and notice that you’ve got some, missing parts or, or things like that.
Maybe they’re the the root inserts weren’t weren’t aligned perfectly correctly or, or something like that, when you go and try to install. So. There’s all kinds of things that, that can, have an impact here, but those are, those are probably the, the top issues you’ve got.
And then, you’ve, you’ve still got, while it’s infrequent, a full separation of the blade is probably the, the number five thing that happens in terms of total cost impact. So we’re looking at just for the U. S. market, by the way this year, it’s about 2. 5 billion in blade repairs that we’re anticipating are going to be necessary.
By 2030, we’re talking about 3 billion. And by, we, we only did our projection out about 10 years, but by, within 10 years, it’s going to be around 3. 3 billion. And that’s assuming that you have turbines that have no service lift. For turbines with a service lift, thankfully and since most, three, four, five, six megawatt turbines are gonna be installed that way from, from now on We’re looking at, anywhere from about two and a quarter billion up to, maybe three billion within ten years.
So, whether you’ve got a service lift or not, we’re talking, close to three billion dollars in, in a blade repair market alone that is Going to need to be serviced and those costs are continuing to inch up. So the other aspect of this that, that you asked about was regarding the growth in turbine size and, and power rating.
And what we’re noticing is that it’s not necessarily reducing the. The frequency of occurrence and the annual failure rate for specific failure modes. You’re still seeing lightning damage. In fact, with longer rotors, you may we don’t have enough data, unfortunately, because there’s not enough turbines out there, but you may actually see an increase in lightning damage as a result of longer blades.
So the reality of this is these, we’re kind of considering these estimates to be a bit conservative at this point. And we’re, we’re looking at a scenario where as turbines are getting bigger, Yes, you get more power out of it but you also get a higher impact on your downtime because for a single turbine going down, you’re not only talking about the repair cost and time you’re also talking about the, the loss of production.
And with that much of a, of an impact on lost production, it’s actually just as financially impactful to the asset owner. Because keep in mind that when we calculate these repair costs and the numbers I’ve just quoted, that’s literally only the, the actual cost of repairs. That’s not even taking into account the downtime which we will be kind of factoring into this.
When we kind of expand on this analysis later, later this year we want to be able to get down to a point where we can see what that impact is going to be on, on owners depending on the, the frequency of occurrence and regional distribution and all that, that sort of thing.
Allen Hall: So what I have seen from the field is as operators have chosen larger turbines, it seems great, right?
There’s less wires in the ground, fewer pads. Concrete everything adds up on that side, right? So it’s just less stuff, but what I’m seeing on the blade side is blades are newer less service history Transportation tends to be more of a problem You see more blade damage from transporting and lifting because of the blades have just gotten bigger and they’re harder to manage On top of that the the unknowns are still there, right?
so instead of We don’t have a good understanding, in some cases, in the early in the design phase of some of the twisting moments and, and the weird things you see out in the field. So you just experience it once they get out there. So instead of having a one and a half megawatt machine in which you have a proven service history, you get it up with this new big massive blade out there.
And what I’m seeing is that the failure rates go up. Not down. So the, the history we have with smaller blades seems to stop with those smaller plates. That’s not, you’re not having a, like a 3 percent failure rate doesn’t seem to be steady across platforms. What seems to be happening as the platforms get larger, the failure rates go up.
So even though you’re putting in fewer turbines, you’re, you’re still working against the failure rate going up. So you’re still roughly losing, you’re losing more power out of the farm than you were previously by having larger turbines is what it So is there really a savings? And this is where I want to get to folks.
I think this is the interesting piece to the analysis is, is it actually less expensive to put more turbines in of a lesser
Philip Totaro: power rating? If the availability is better and the reliability of the components is better, then yes. And, but here’s the thing, here’s the catch on why everybody wants a bigger turbine is because it’s necessarily a bit lower upfront CapEx.
It can, it can lower the, like you said, it’s a fewer number of pads, fewer electrical connections, et cetera. So everybody thinks about it in terms of, Oh, I’ve got to finance this, this project. And we’ve got to reduce the upfront CapEx as much as possible. So how can we do that? Well, let’s get the biggest turbines we can get.
And that’s the mentality. That’s what’s being, so basically what’s happening is developers and. The asset owners that they’re, if they’re doing a build and transfer a business model the asset owners and the developers who originally built the projects, they aren’t necessarily taking into account this total cost of ownership.
They’re assuming that, certain fault and failure rates that are underestimating what we’re actually seeing. And what it’s resulting in is actually bigger losses because of all the things we just talked about, what you’re seeing in the field and what we’re seeing from data.
Allen Hall: So the end of store data becomes really critical here because if you’re making those decisions, you need to understand a craneless repair versus a crane repair.
And the fact that it multiplies it times a hundred, a lot of cases on the cost and then the business interruption and all the other things that come with it. There is a real trade off here. We are crossing this threshold, which you guys are identifying of size versus quantity, right? That’s what it is.
Bigger size or more quantity. You need to pick one. The data, we don’t have a lot of data yet, and this is where I think the end of store data becomes really critical to the decision process, right?
Philip Totaro: Well, we hope so. And, and look, we’re, we’ve built this based on a data set that’s been collected from various independent power producers ISPs, and some academic research papers.
But we need more. And so this is a call to action, and frankly, an opportunity for asset owners and operators will pay you royalties for access to some of this information. You don’t have to give us like necessarily site specific data. We would certainly prefer to have turbine specific data so that we could identify which OEMs are really kind of, or which products are really the, the red headed stepchild, if you will, of the, the product family.
But we need to be able to quantify it. I think a lot of people know, kind of anecdotally, it gets talked about, texts from different sites talk to each other, Oh, this thing’s a big pain in the butt. That thing’s not, but You know that we need to quantify it and and in quantifying it at the end of the day, the reason that we do what we do with all this data is we’re trying to tell a story and we’re trying to attract investors to this industry.
Okay, we’ve got a good story to tell. Despite the fact that we’re going to have this, this O and M challenge, we’ve got a really good story to tell in terms of cost of energy in terms of, greening the electric system there, there’s a great story to tell here, but we need data to be able to convince people that we’ve got, a place where they can feel confident in parking their money.
The more data we can get our hands on in terms of fault and failure rates, in terms of, time it takes to do a particular type of repair, which, frankly speaking, It doesn’t necessarily have to be that sensitive, okay? It’s, we’re, we’re just trying to, come up with the best estimates that we can so that we can all work together to try and attract more investment to this industry.
That’s ultimately what we need to be able to do, and, and having the data at our disposal as an industry to be able to tell that story is absolutely essential.
Allen Hall: Does this help us better understand where the next plateau of wind turbine sizes will be? Like GE and Vestas have done offshore at 15 megawatts, is there going to be a data point crossing where you say, All right, 3 megawatts is as far as we should go onshore because it is the most efficient machine we’re going to be able to build and transport and install and maintain today.
Anything bigger than that is going to be trouble. For Doesn’t that data lead us to that kind of decision matrix and also in terms of PPAs? Because the PPA market is a sort of a fixed market out there And if you know what that sort of ballpark cap is for PPAs You’re really trying to keep your costs well underneath those PPAs ideally
Philip Totaro: that’s going to have a decision matrix too, right?
Well, and keep in mind something that we’ve been analyzing recently, which was If you’ve got a PPA that’s below what you’re getting for production tax credit revenue, so basically if your PPA is below, like, let’s say 26 a megawatt hour or, 26. 80 or whatever it’s indexed to these days, if you’ve got a PPA below what you’re getting for PTC revenue, you are absolutely dependent not only on the PTC revenue, but you are absolutely dependent on high availability.
If you do not have high availability, you’ve got a big problem, a revenue problem, and you’re not only going to have to repower, but you’re probably going to have to repower with refinancing a substantial portion of your project site. In that repowering cost any residual value that you haven’t already paid off from the original project, you got to carry that over if you’re debt refinancing your project or whatever you’re doing you’re, you’re going to have a certain amount of, of money left over that you’re going to have to include in, in that refinance.
The more you can pay that down, the faster it, which again, translates back to high availability. The, the faster you can generate revenue on your project, the faster you can reduce the residual value of your project down to a point where you’ve, you’ve broken even and you’re seeing a net positive return on capital that is essential in terms of financial health and, and portfolio viability.
The good news is we’re seeing merchant market prices trend back up there around, 35 to 40 this year. But, going back a few years, I mean, you were seeing power purchase contracts in the U. S. market get executed down like 10, 11, 12 for, for some projects. Now they might have only been like a three or five year duration on that On that PPA, but it’s still a problem, like you, if you’re not going to be able to then transition into a merchant market, if you’re going back to these, power off takers that are only going to pay you like 15 bucks a megawatt hour, you have to be on top of your availability.
Because availability equals PTC revenue equals financial viability of your project. And that’s
Allen Hall: where the IntelStor data comes in, right? Because IntelStor has done the analysis in all the wind farms in the United States to look at availability, which then goes to how the turbines are maintained, the type of turbine that is installed, all those little variables that do produce an availability number.
In a store has, you can go back and look and say, well, this turban did really well in this part of the country because they’re using this type of maintenance scheme. Maybe I want to repeat that because I know what my output will be at the end of the day. Well, my payback
Philip Totaro: time will be right. Absolutely.
And this goes back to what I just talked about. We’re trying to tell a story about. If there’s a particular asset owner or operator that’s doing a really good job and has a really financially healthy portfolio, that’s the kind of, place that investors want to be able to park their money.
That’s the type of, the people who originally developed that project. They’re going to get, an easier time of it, trying to go get financing. The people who are owning and operating those projects are going to have an easier time of it going and getting financing. And it’s largely down to the fact that they’ve taken things like this O& M challenge seriously.
They, they’ve recognized the fact that we’re seeing these issues and they’re getting on top of it by being proactive with their maintenance. Because of, again, all these things we just talked about, you need high availability, you need to reduce your OpEx cost, you need to reduce the frequency with which things fail, and you need to be able to detect that something’s going to fail earlier, so that before you need to call out a crane, you can, you can address it, and you won’t have that that escalation of cost that you necessarily see.
Thank you. So this was, I mean, look, I’ll go back to when we had our IntelStor event the O and M in San Diego, back in February, there was an independent power producer who was there that specifically asked for this. They, they wanted to know how much, we’ve got a finite amount of, of budget to spend, how much can we realistically.
Get out of, addressing all the things that were like a cat 4, cat 5 damage on, on the blade that we have to address to be able to get it back up and running. But going down into things that were maybe cat 2 or cat 3. Should we really put off doing the maintenance on those or are we going to get to a point where we’re going to incur a substantially increased cost later because we’re going to have more crane callouts than we would otherwise have?
And anytime you can reduce crane time, everybody already knows inherently that’s, that’s critical. And I
Allen Hall: think this data from what I’ve reviewed of it drives you to some questions about continuous monitoring systems. very much. And other types of systems just to, to keep your turbine from, and that could be technicians having more touch time with the lifts inside the turbines where you can get up and down and take a quick look like, like blade bolts seems to be a big issue, pitch bearings, big issue, right?
That seems to be industry wide. You, you have to stay on top of these things where before, I think, five years ago, ten years ago, you weren’t as on top of them, you didn’t need to monitor them, your farms were smaller even, and now that we kind of crossed this threshold, we’re like, Sunzea, which is, I don’t know how many turbines, 650 turbines or something like that.
Those numbers are massive. There’s no way you’re gonna be able to monitor all those turbines. Doesn’t that, with the, especially with the data you have, and the failure rates, and the projections forward, doesn’t that really force your hand into some sort of continuous monitoring systems so that you can then keep track of what your failure rates are and get ahead of some of these maintenance items.
Philip Totaro: The good news is that the reason that condition monitoring had such a hard time getting adopted with smaller turbines was because of As a percentage of cost of the overall turbine capex, a condition monitoring system was just too expensive. But the technology’s improved, the cost per kind of installed megawatt, shall we say, has come down a little bit.
Over the years based on just economies of scale with deploying more CMS systems. But as turbines get bigger, you can more sort of easily afford I’ll, I’ll say a full kind of condition monitoring system. If you’re getting up to the point where you have a four, five, six megawatt turbine, you’re almost going to want this because you also frankly, whether you’ve got a service lift or not, if you can avoid sending a tech up tower, That right there is, or multiple techs up tower, that right there is saving you, potentially thousands if not millions of dollars across your entire fleet during the course of a year.
If, if we go back to the data we just calculated, Cost Delta between for just for blade repairs for if you assume nobody’s got a service lift versus there’s 100 percent service lift adoption, it’s a diff it’s a difference of 300 million just in the time that techs are taking to climb towers. And that’s, again, that’s just for blade repairs.
We haven’t even done the math on, pitch systems, main shafts. Gearboxes, generators, converters, et cetera. Everything else that might necessitate having a tech go up tower. So, not, we’re, we’re not necessarily doing a, an advertisement for, the service lift companies, but, if I’m, if I’m the sales guy at a service lift company, I should expect my phone to be off the hook at this point.
Allen Hall: Yeah, I would imagine. So the, the IntelStor data is pointing everybody in the right direction. And I think the industry is starting to wake up to what, what data IntelStor has and the power it has and the advantage it gives you going forward, particularly as we build out more turbines across the United States and all over the world.
This data becomes important in the decision making process. So, Phil, how do people get ahold of you and check out IntelStor’s data?
Philip Totaro: They can visit our website, www. intelstor. com, intelstor.com/contact. You can reach out to me on LinkedIn, any way you can get in touch. We’re always happy to have a conversation, and we’d love to be able to help you.
https://weatherguardwind.com/intelstor-wind-turbine-blade-om-cost/
Weather Guard Lightning Tech
Vestas Shares Jump 20%, UK Blocks Ming Yang Factory
Vestas doubles second quarter profit and adds €4.7 billion in market value overnight. Plus EnBW finishes He Dreiht after a V236 blade break, the UK blocks Ming Yang’s Scottish factory, and India rules turbines are movable goods.
The Uptime Wind Energy Podcast is brought to you by Weather Guard Lightning Tech, creators of the StrikeTape Ultra LPS retrofit. Subscribe to Uptime’s Substack newsletter. And check out Rosemary’s “Engineering with Rosie” Youtube channel. Have a question we can answer on the show? Email us!
The Uptime Wind Energy podcast, brought to you by StrikeTape. Protecting thousands of wind turbines from lightning damage worldwide. Visit StrikeTape.com. And now, your hosts
Allen Hall: Welcome to the Uptime Wind Energy podcast. I’m your host, Allen Hall, and I’m here with Rosemary Barnes, Matthew Stead, and Yolanda Padron. And three out of the four of us will be in Melbourne Australia talking to a number of operators and interested parties about WOMA 2027. Matthew, where will we be the couple of days we’re in Melbourne?
Matthew Stead: So, um, first of all, we’ve got the Pullman, uh, East Melbourne, which is, uh, where the venue will be for, for 2027. Um, so that’ll be our home base. Um, we’ve got around about eight meetings planned already. So what we’re doing is we’re talking to the operators and a few other industry, um, players about [00:01:00] what we need to talk about, how we’re gonna move the industry forward in Australia.
Uh, so it’s gonna be jam-packed, but there’s a little bit of time left on the Friday afternoon if there’s any late-minute, um, people that wanna get in contact and catch up with us, um, for next Thursday, Friday, or actually Friday. Uh, so yeah, it’s gonna be a, a jam-packed time. I think we’re gonna be tired, too many coffees, and talking to all the key, all the key operators, uh, about what they wanna hear about and how we can move the, the industry forward.
Allen Hall: And if someone wants to put an input into the WOMA panel about what will be discussed at WOMA 2027, Matthew, how would they do that? How do they get ahold of you?
Matthew Stead: Well, we have a wonderful website, and that’s got all the details you could ever want. Um, you can also register on the website, so please register.
Otherwise, um, I’m sure we’re gonna be a sellout this year for sure. So woma2027.com.
Rosemary Barnes: I just wanna add that when people talk to [00:02:00] me about the event, they always say how they love that the topics are so relevant, and the reason why that they’re so relevant is because we make sure to go around to operators and find out what are the issues that they’re really dealing with.
So anybody that’s thinking of attending, even if you can’t, you know, meet us up, meet up with us in Melbourne, get in touch and tell us what are the, yeah, what are the topics that you’re struggling with that you’re not, um, you’re having trouble finding enough information, having trouble finding the people that can help you.
And y- yeah, like we take all of that information, and that’s how we come up with our agenda each year. And yeah, I mean, for us, that’s the, the main thing is that this has to be really relevant, up-to-date information for the industry, and we need your help to make sure it stays that way. I
Matthew Stead: mean, that’s what we’ve done the last two years, so this is– we’re just repeating the formula, um, listening to the operators and getting the good topics and the good speakers.
Allen Hall: Well, Vestas has had a good quarter. Uh, the, for the last couple of years, honestly, s- [00:03:00] Vestas has been really thin on margins. There was questions about it continuing on. Rising costs mostly, uh, supply chains, especially during COVID, were bad. Uh, and, uh, but for the most part, the shareholders stayed attached.
Well, that story is changing rapidly. The world’s largest turbine maker posted second quarter operating profits of $400- €46 million, more than double what the analysts had expected, and it’s raised its full-year margin guidance alongside half-year results for the first time in a decade. The shares climbed about 20% in Copenhagen, adding roughly €4.7 billion of market value in a single session.
Now, the chief executive, uh, Henrik Andersen, ha- put it plainly to, uh, uh, in a couple of news sources that something much bigger is happening and Vestas is gonna be the, the leader in wind. That’s how I read it, that everybody [00:04:00]at Vestas was super happy with the, the change in direction and things were moving up steadily.
But a 20% jump in a day is remarkable. You don’t see that in large industrial businesses like wind energy. Matthew, this has real implications on what happens next for Vestas because success like this usually means more orders.
Matthew Stead: Yeah, I wonder what’s going on under the hood there. Um, I mean, Vestas is a quality company, although, although can I just do a quick segue?
How many turbines were installed in Denmark in the last, uh, two years? Like last year and the year before?
Allen Hall: I don’t know. How many?
Matthew Stead: I believe it was eight turbines installed onshore in Denmark last year, and the year before it was 12. So, you know, maybe, maybe Vestas needs to focus on their own backyard a little bit as well.
Allen Hall: I’m not sure there’s a lot of opportunity there. Yeah, onshore.
Matthew Stead: How can you ever be full? I mean, there’s always, um, [00:05:00] uh, you know, um, you know, resiting or, um, you know, upgrades and-
Rosemary Barnes: You know what? Allen and I are probably gonna get some time in Jutland, uh, later this year, um, and that area and the old wind turbines there was actually the inspiration for my whole YouTube channel.
It just, ’cause there’s, you know, there’s turbines there from, the earliest one is, um, from the ’70s and still going. I think it’s one and a half megawatts, actually huge for, for that time. Um, and it was like community made, um, at Tvind. But anyway, I’m interested to revisit the site and have a look and see are these, you know, all these old turbines still there.
It’s only, like six years since I went through and did the experience but for the most part, they don’t seem to be yet pulling down the, the small old ones and putting up big ones. There’s a lot of, a lot of them are community owned. Um, and yeah, I mean, Danish people love wind turbines, but there’s only so many that you can have onshore.
Like, people are happy to live near them by, you know, the standards of people in other countries, but you don’t want [00:06:00] one in your literal backyard. I think that there is, there, there is a, a limit to how many more onshore wind turbines that you can get in that area and offshore expansion is the more likely way to go.
Um, and also I think it’s, it’s, it’s good to recognize that if you have a domestic only or a domestic first strategy, that will only get you so far and then you have to expand, and I think Denmark did that really well. I think Germany a little bit less. I think that Enercon were a bit surprised, um, by their strategy.
It, uh, they had a real hard time anyway when they had to transition away from mostly Germany to getting overseas. And obviously, like if you look at China, they have most of their installations are in China. They are trying so hard to get outside of China because it’s not, like even a market as big as China, it’s got decades to go before it will be full.
Um, you can still recognize that that’s not your, like long-term strategy for growth has to involve expansion, I think.
Allen Hall: I think Vestas, regardless of what happens in Denmark, is making a play for the United States. That seems to be [00:07:00] where a significant effort is happening at the moment and on offshore. Their– Vestas seems very excited about the offshore opportunities.
Of course, there’s a ton of wind turbines gonna be installed in the UK and, and all around Northern Europe. Offshore, the opportunities to buy turbines, there’s only a couple that you could get today. Uh, uh, the GE Vernova offerings I, I don’t think are gonna fit the mold, and I don’t know if GE’s even actively selling.
So their competitor realistically is Siemens Gamesa, which does seem like the smaller player at the minute versus Vestas, which is heavily pushing the V236 and will fill order books like crazy, I think, uh, just based upon the, the history they’ve had and everybody knowing who they are. So Also on the move in Australia, right?
Vestas is huge in Australia right now.
Rosemary Barnes: I think it’s really good that their, um, yeah, finances, uh, are [00:08:00] looking a bit better ’cause it’s been funny. Like, I tried early on in my wind career to invest in, you know, wind turbine manufacturers knowing that there would be immense growth, and I was right. There, there was immense growth.
Not that that was so hard to figure out that there would be, but it did not lead to any kind of, um, return on, on anything, you know. Like, that did not keep pace with the just general market. Um, so I, I stopped trying to, stopped trying to invest to that. But it has been really, really hard for the companies to, you know, raise money or y- you know, do any of the things that they need to do because they’ve always, like, they’re growing, growing, growing, but finances has been so tight that it has been a real constraint on the amount of engineering that they could do, and I really hope that Vestas are gonna take this opportunity that they’ve got compared to, you know, a lot of the other manufacturers.
Vestas do have really strong, um, innovation and, yeah, engineering capabilities for doing– you know, developing new technologies and improving them, and I really hope that they’re taking this opportunity to build that up. There are a lot [00:09:00] of very good engineers with a lot of experience in the industry in that area that are working in other fields at the moment because, you know, there’s been a lot of contraction in Denmark.
So I don’t know, it seems like a really good time to hire back some of that really in-depth knowledge and, yeah, get a- get ahead of, you know, some of the future quality problems. We’re going through such a hard time at the moment from the fast development that happened in the 20-teens when there wasn’t a whole lot of money around.
We’re dealing with quality problems now, so, you know, maybe we can get ahead and not have the next round of them if we can invest in just a lot more, uh, engineering capacity.
Allen Hall: When you have success like Vestas has, usually the upper level management and some of the executive team starts getting pilfered, that they’ll get offers to repeat that success at another company, and it sounds like that process has started already.
There’s a couple of executives that have recently departing or are in the midst of departing from Vestas. [00:10:00] I would see that continuing f- at least for the next six months, uh, because everybody wants to repeat that, right? If you can get a 20% increase in your valuation overnight, uh, I can, I can list a number of companies, regardless of industry, that would love to participate.
Even in a 5% increase, that would be remarkable. So, um, Vestas is gonna have a hard time holding onto this. That’s just the nature of the business where things are successful, people will wander. And Rosemary, I, I think they’re– And Yolanda In, in my book, Vestas should sort of s-stand down and just make quality products.
I’m not sure you sh-should tinker too much at the time being and just make the good stuff better. That seems like a way to really increase profits.
Yolanda Padron: Yeah, I mean, solving a lot of the issues that– And, and that’s not just a Vestas exclusive thing, right? All of these OEMs have some sort of issue that maybe– I know Rosie’s touched a lot on, on it, where [00:11:00] you build this version A and then version B solves one of the small little issues, but now it creates another little problem, and then you have version C, and then everything just kinda has its own niche little issue, um, that really expands over time.
So if they could solidify what they already have in, in a, in a model that, that would help them just even keep a lot of their customers, I think that’d be great, and it would help, certainly help them, um, not continuously, like, rotate around the customers, ’cause it almost feels like, at least in the States, right, you, you get GE to be really, really strong and have a huge market share, and then GE starts focusing more on gas turbines, so then they all go onto Vestas, and then they all go onto Ontara now.
Um, and then just, you know, just kind of everybody starts cycling through them because they just kind of want something that’s better quality than what they’re getting in the long haul.
Matthew Stead: Allen, you, you talked about you think there’s something big under the hood. I think you, you [00:12:00] thought that maybe Vestas was angling towards something or being quite bullish.
Do you think that they might take over GE Vernova?
Allen Hall: I don’t think they’re gonna grab Vernova, and I don’t think Vernova is for sale at the minute, but I wonder if Siemens Gamesa is, or Nordex. I mean, Nordex has done terrific the last couple of quarters and is making inroads in places that I didn’t think possible three, four years ago.
Uh, the European marketplace is be- becoming really unique in that sense that there’s a lot of money being put out. But is there a sole perfect solution for Europe? Not at the minute, ’cause you got two competitors there, and then China trying to, to work its way in. Will the Europeans come together and form something more united, even if it’s just a partnership, a loose partnership, versus letting China on the shores?
We’ll see. 64 of the largest machines that Vestas has builds are standing off the German coast, but one blade is missing a [00:13:00] piece. We’ll talk about that when we come back.
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Allen Hall: Well, Germany’s largest offshore wind farm is now fully installed, and EnBW confirmed this, uh, past week that all 64 of the Vestas V236 15-megawatt turbines are s- standing at the He Dreiht wind farm about 85 kilometers northwest of Borkum. Uh, 960 megawatts, [00:14:00] 2.4 billion euros invested. Man, these offshore projects are expensive to get installed.
Uh, so it’s power for roughly 1.1 million households, and there’s no state subsidy behind any of it. And so this is a little bit of a u- unique situation. Uh, th- well, the one footnote about the wind farm is they had a V236 blade break and fall into the North Sea, and they had fished it out and I think I passed along s- pictures that I saw online of, uh, one of the police boats pulling the shear web out of the water I don’t know what to think anymore about some of these offshore blade issues.
Obviously, Vestas is very conscientious about it and will be doing RCAs and engineering reviews and all the above to go identify what the problem is. But it does just lead to a little bit of a pause of do– what is going on for some of these offshore [00:15:00] wind blade installations or, or whatever’s causing these blades to break?
Do we have a good handle on it? Yolanda, is– are we following up on all the design details so that we can prevent these things in the future?
Yolanda Padron: I mean, I’d, I’d hope you’d be following up on the design, right? Like, and, um, but I think there is still a little bit of a disconnect from, from what we’ve seen, and again, not just Vestas exclusive, um, between the people who are designing and the people who are manufacturing, the people who are in operations, right?
So, uh- The, from what we’ve heard, uh, this could have potentially been a, um, partially because of a transportation issue, which is what happens a lot in onshore. It’s a lot more common than we would like it to be. Um, and so that even goes beyond what would go on in the design studio and what would go on in the manufacturing and what would [00:16:00] go on even just for the people that are running the site, right?
So, so some sort of, um, in between, uh, EPC error. Um, but yeah, I just think that, like in a lot of industries, there should be a lot more communication between all of these teams on the lower level, so that way a lot of these problems can, can be avoided.
Allen Hall: I’m wondering if it’s actually an issue on the, the testing side.
And, uh, the one question that just popped up, and we saw from the ORE Catapult, uh, survey that’s being conducted at the moment, and if you haven’t participated in that, you just visit ORE Catapult and answer some of the survey questions. But torsion on a blade, which is very difficult to test for, and it really isn’t tested for today, but does happen during the move and the transportation of these big offshore blades.
Is it one area that we need to do a little more work in or maybe spend some more time focusing on it to see what is happening as blades are [00:17:00]moved?
Rosemary Barnes: The thing about te- torsion is that it is much more significant as blades get longer. I can’t, I can’t remember the equation off the top of my head, which is, um, bothering me.
But I think it scales with, like, the fourth power or something of, of length. And so whilst it was always a bit of a problem, it’s much more of a problem as it gets, as blades get bigger. I mean, they’ve never, like, fully tested a blade, and there was always a lot of reliance on, hey, y- you know, like we’ve tested certain things that is possible to test in a test facility on the ground.
But they also rely on their decades of experience of how blades actually behave in the field. But, you know, remember, that’s a real lagging, lagging indicator because y- you know, their decades of experience is mostly with lots smaller blades. Now, blades are really different because they’re longer and different effects are, are taking over.
It’s not just, uh, torsion, but it’s also the laminates get much thicker, and then y- you know, you, you have issues with the way that they’re curing, [00:18:00] and there’s a lot more just space for, um, defects to be present in a really thick laminate All of those things add up. Oh, yeah, then add in addition, like new materials, carbon fiber is new, and then new ways of producing it, you know, pultrusions, um, all kinds of different materials like balsa’s being replaced with foams and, um, like, you know, 10 times that number of what sounds like a small innovation, but all of these things have the potential for damage and don’t have a really long track record in the field to be able to kind of calibrate.
We do need to remember that, like, when you do something new, things are gonna break, uh, sometimes, they’re gonna fail sometimes. If they don’t, then you’re definitely being too conservative, and your product is costing more than it should, and nobody wants more expensive wind energy, right?
Matthew Stead: Rosie, Rosie, I, I know you’re doing some, some excellent work on, um, industry studies around erosion and temperature and so forth.
Um, I just wanted to let a little secret out of the bag that, um, in the future there will also be some [00:19:00] other studies on torsion and blade twist and blade dynamics. So, um, just a few things are in, in train at the moment, which I can’t share, share, but, uh, watch this space around better understanding blade twist.
Allen Hall: The Hydride wind farm runs on European turbines, but the next one might not. Two governments with two very different answers on who gets to build Europe’s wind fleet.
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Well, two countries and two decisions, one question. In Scotland, the UK government blocked plans for the Chinese manufacturer Mingyang to build a turbine factory, uh, near Inverness on national security grounds. 1.5 billion pounds of investment, up to about 1,500 jobs. And First Minister John Swinney has asked the new prime minister to reconsider.
And the UK energy secretary minister called that request irresponsible. Meanwhile, up in Denmark, Vattenfall has just won two offshore wind farms and will not say whether it will buy European turbines. Danish suppliers are not taking that quietly. So [00:21:00] the Scotland question about the Mingyang factory is at least being discussed again with the new prime minister in the UK.
It does seem like there’s a lot to do and get the government formed and make all this stuff happen. But I don’t see a Burnham administration changing the outcome for Mingyang, but I could be wrong. At the, the same time, Vestas is pushing for a more Eurocentric focus and to really keep out the Chinese.
Uh, something has to give here pretty soon.
Matthew Stead: I actually think Mingyang should, um, set up a factory in Scotland. I, I mean, what’s wrong with that? I mean, uh, why is that a security issue?
Rosemary Barnes: Set up the factory and put the, like, whatever you’re worried about, put protections in place for it, require it to be a local joint venture or whatever.
You know, we’ve seen the blueprint in many of what used to be, you know, less rich countries. That’s how they, you know, got a head start on some of these technologies. It’s not like, I don’t think that China [00:22:00] has a head start on wind, wind turbine technology, but they certainly have different ways of doing things that, um, yeah, we could, we could learn from.
But I think across the board, wind turbines, batteries, solar panels, whatever, let them set up factories, put the rules in place that mean that your country benefits from it and you’re getting the, you know, the information transfer.
Yolanda Padron: Do you think that’ll, like, impulse a lot of these more established European companies to maybe start fixing some of the issues that they’ve known about for, for a while, um, particularly regarding the blades and everything that we’ve talked about earlier?
Like, there’s enough competition there, so maybe they need to start looking a little bit more deeply into their problems.
Allen Hall: Do we think that Chinese operations have been out front, forward, honest, I’ll even use, about their blade issues?
Rosemary Barnes: No, but this is a good way to find out, isn’t it?
Allen Hall: Governments decide who is allowed to build a turbine after a discussion on Scotland.
Uh, but, but [00:23:00] occasionally, a court decides what a turbine legally is. India has just settled that question, and the reasoning should be of interest to anybody who ships machines across a border right after this. As wind energy professionals, staying informed is crucial and let’s face it, difficult. That’s why the Uptime Podcast recommends PES Wind Magazine.
PES Wind offers a diverse range of in-depth articles and expert insights that dive into the most pressing issues facing our energy future. Whether you’re an industry veteran or new to wind, PES Wind has the high-quality content you need. Don’t miss out. Visit peswind.com today. A tax fight in India has produced a definition every turbine supplier should read.
Is a wind turbine bolted to a concrete foundation movable goods, or is it immovable property? State tax authorities argued immovable, which would have [00:24:00] taxed erection and commissioning contracts at 18% instead of 5%. The Andhra Pradesh, uh, High Court disagreed, and on the 12th of August, the Supreme Court declined to interfere.
The reasoning rests on something this whole industry takes for granted. A turbine can be taken down, moved, and put back up. So a turbine is a movable object, and it has less taxation. Bonus. So this is a really interesting discussion that’s happening in India because it’s probably symptomatic of things we’re seeing elsewhere across the world about taxation for wind turbines, right?
That, um, if there’s a way to tax a wind turbine, we’re gonna try to do it. This is a unique way, uh, that happens in India where depending on if it’s permanent or movable, the tax rates are different. I, I guess that would apply to a lot of components inside a wind turbine too, Matthew, don’t you? Like the, the generator, the, the big heavy things, [00:25:00] gearbox, generator, blades, rotors, tower sections, would be taxed at a, a lesser rate.
Matthew Stead: I agree with the court case that it’s all movable and, uh, you can actually buy turbines on the secondhand market, can’t you? I mean, if I wanted to buy, yeah, whatever, whatever, I could buy one and, and put it up in my backyard if I had a bigger backyard. Um, so yeah, I vote for movable. I vote for lower taxes.
Yolanda Padron: The way that it would work a lot of times in the US is, I mean, it’s, you pay, the company itself pays a lot less than they would’ve over time, right? Just by pure, the, the regular kind of tax laws. Um, but the community, there’d be just direct donations to the community, so then they’d get, uh, like money would actually come into the community where the turbines were being built instead of just distributed around the state, which I mean, in a state as big as Texas, it gets, um, but easier for that c- um, that county to get a lot more, uh, funding than they would typically get if it was [00:26:00] through a big enough area.
Um, but yeah, no, I agr- I completely agree with you guys that, that this should be a movable good. I mean, how many times have we seen, uh, even just a blade, um, that it looks like it’s, uh, just a, a failed blade that they have to go in and replace, and then they take it out, fix it, and then just bring it back to the same site or take it to another site across the country.
And, and to that point, like if you were to h- judge it as something that’s immovable, would then any blade replacement just not be taxed? Because then it’s, you’re moving that one component and two, but it’s essentially the same turbine. Like, I don’t know how that all would make sense.
Allen Hall: I think the Uptime Supreme Court agrees with the Indian Supreme Court that wind turbines are movable, and that’s good.
Well, that wraps up another episode of the Uptime Wind Energy podcast. If today’s discussion sparked any questions or ideas, we’d love to hear from you. [00:27:00] Reach out to us on LinkedIn. And if you found value in today’s conversation, please leave us a review. It really helps other wind energy professionals discover the show.
And don’t forget to subscribe so you never miss an episode. For Rosa, Yolanda, and Matthew, I’m Allen Hall. We’ll see you here next week on the Uptime Wind Energy podcast.
Can’t swear that the story here is authentic, but it sure rings true.
Vermont is a somewhat quirky state, but it protects its citizens very well. FWIW, this is where I want MY tax dollars going too.
Florida is a deeply red state that, true to form, wants as much ignorance as it can possibly produce. Educated people aren’t voting for people like Ron Desantis.
The GOP is asking American voters to believe that “radical left Democrat extremists” are leading the country into socialism/communism. They’re hoping that this fear will outweigh the electorate’s understanding of the damage that Trump, with help of congressional Republicans, is inflicting on this nation in the form of the war in Iran, destroyed relations with allies, inflation, shoddy education, environmental collapse, and threats to Social Security and Medicare.
As we all know, the rate at which a lie becomes accepted as true is a function of the frequency that it is repeated. And God knows, we see this crap about communism every time we turn around.
But this looks like an unwinnable battle. Virtually no one wants to abandon free enterprise. Moreover, Trump’s abysmal polling numbers reflect the fact that is largely despised as a criminal–the most corrupt figure in U.S. history.
How would you like to be campaigning to retired baby boomers on the platform that we cannot afford Social Security any longer, because we’ve siphoned off huge amounts of money, like our president’s “vanity war,” with only further downside in sight, that is costing $1 billion a day?
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