An evaluation of Chinese Wind Turbine Manufacturers using the enterprise niche theory

With support from the Chinese government, the Chinese wind power generation industry is experiencing rapid development. The quick growth of the wind power generation industry has promoted the development of the Chinese wind turbine manufacturing industry. Similarly, the quantity and the productivity of the local Chinese Wind Turbine Manufacturers (WTMs) have also undergone a quick and significant expansion. This is resulting in an increase in competition amongst the WTMs in China. Being relatively new, this creates a fertile environment for local Chinese WTMs that is ripe for study and analysis. Based on the niche theory of industrial ecosystem and enterprise, this paper investigates the Chinese wind turbine manufacturing industry, and proposes a wind turbine manufacturing industry ecosystem model and a WTMs’ ecological niche evaluation index system (WENEIS). Use is made of a catastrophe theory model evaluation method to evaluate the ecological niche status of the 6 main local Chinese WTMs selected and a spider diagram is established to compare the status of the different enterprises’ ecological niche. The proposed WENEIS aids WTMs in finding the competitive advantage and disadvantage factors for their development, as well as providing a valuable reference for the WTMs to improve their business environment and to formulate their competitive strategy in the future.     

Fostering a renewable energy technology industry: An international comparison of wind industry policy support mechanisms

This article examines the importance of national and sub-national policies in supporting the development of successful global wind turbine manufacturing companies. We explore the motivations behind establishing a local wind power industry, and the paths that different countries have taken to develop indigenous large wind turbine manufacturing industries within their borders. This is done through a cross-country comparison of the policy support mechanisms that have been employed to directly and indirectly promote wind technology manufacturing in 12 countries. We find that in many instances there is a clear relationship between a manufacturer's success in its home country market and its eventual success in the global wind power market. Whether new wind turbine manufacturing entrants are able to succeed will likely depend in part on the utilization of their turbines in their own domestic market, which in turn will be influenced by the annual size and stability of that market. Consequently, policies that support a sizable, stable market for wind power, in conjunction with policies that specifically provide incentives for wind power technology to be manufactured locally, are most likely to result in the establishment of an internationally competitive wind industry.     

Performance of wind power industry development in China: A DiamondModel study

A reliable supply of energy is essential to maintain and to improve human being's living conditions. Compared to the conventional coal-fired approach, renewable energy (RE) helps to mitigate the impacts of greenhouse gas emissions to a large extent. As a newly developed sector with large resource potential and good commercial prospects, China's wind power industry is exceeding expectations. By 2008, installed capacity of wind power in China totaled over 12 GW, making China the fourth largest wind market in the world. However, China has to admit the gap with foreign leading countries, mainly in technical R&D for large-scale wind turbine generation units. This paper attempts to formulate an analytical model for studying and assessing factors that have significant impacts on the local industry. An improved dynamic Diamond Model is developed to help the international community to understand the status quo of the Chinese wind power industry. In order to build a stronger wind power industry, the elements identified in the model need to be strengthened.     

Wind farm investment risks under uncertain CDM benefit in China

China has set an ambitious target to increase its wind power capacity by 35 GW from 2007 to 2020. The country’s hunger for clean power provides great opportunities for wind energy investors. However, risks from China’s uncertain electricity market regulation and an uncertain energy policy framework, mainly due to uncertain Clean Development Mechanism (CDM) benefits, prevent foreign investors from investing in China’s wind energy. The objectives of this paper are to: (1) quantify wind energy investment risk premiums in an uncertain international energy policy context and (2) evaluate the impact of uncertain CDM benefits on the net present values of wind power projects. With four scenarios, this study simulates possible prices of certified emissions reductions (CERs) from wind power projects. Project net present values (NPVs) have been calculated. The project risk premiums are drawn from different and uncertain CER prices. Our key findings show that uncertain CDM benefits will significantly affect the project NPVs. This paper concludes that the Chinese government needs revising its tariff incentives, most likely by introducing fixed feed-in tariffs (FITs), and re-examining its CDM-granting policy and its wind project tax rates, to facilitate wind power development and enable China to achieve its wind energy target.     

An over painted oriental arts: Evaluation of the development of the Chinese renewable energy market using the wind power market as a model

China is now the largest CO₂ polluter in the world. However, the renewable energy policies in China are controversial and one can easily draw the wrong conclusions that Chinese renewable energy development has taken off from a surface assessment of the policies. By investigating and summarizing the first-hand experiences of participation in the Chinese renewable market (mainly wind farm development) in the past five years, this paper provides another dimension of policy analysis and independent review of the current issues facing the market. An investigation of policy changes and consequences clearly demonstrates the transformation of the Chinese renewable market. The domestic manufacturing quality and unprofessional design of wind farms made most developers’ financial returns unrealistic in the wind market. Despite the difficulties and inconsistency in the system, China is tackling environmental issues seriously and heading in the right direction. With centrally controlled management, the Chinese strategies do not have to be justified financially. It is envisioned by the authors that re-organizing over 70 existing Chinese wind turbine manufacturers is unavoidable. Establishment of an internal renewable market, such as Renewable Obligation Certificate (ROC) system in the UK whose effectiveness is another subject of debate, would be an effective means by which the Chinese government in their post-2012 strategy could make the wind market more financially viable.     

Innovation and the price of wind energy in the US

In the last ten years, the wind energy industry has experienced many innovations resulting in wider deployment of wind energy, larger wind energy projects, larger wind turbines, and greater capacity factors. Using regression analysis, this paper examines the effects of technological improvements and other factors on the price of wind energy charged under long-term contracts in the United States. For wind energy projects completed during the period 1999–2006, higher capacity factors and larger wind farms contributed to reductions in wind energy contract prices paid by regulated investor owned utilities in 2007. However, this effect was offset by rising construction costs. Turbine size (in MW) shows no clear relationship to contract prices, possibly because there may be opposing factors tending to decrease costs as turbine size increases and tending to increase costs as turbine size increases. Wind energy is generally a low-cost resource that is competitive with natural gas-fired power generation.     

世界风电产业发展综述

风力发电是目前最具商业化和市场竞争力的可再生能源技术。随着风电技术日趋成熟,风电产业在全球范围得到大力发展,并保持持续增长的势头。全世界风力资源丰富,风力发电将成为最重要的替代能源之一,但风电产业的发展受政策影响较大。文章阐述了世界风力发电产业的现状,分析了世界风电产业的发展趋势。     

The present status and challenges of wind energy education and training in China

Wind energy has been identified in China as an important alternative energy source to balance its energy mix. By the end of 2012, wind power (2%) has surpassed nuclear power to become China's 3rd largest energy resource of electricity, only behind thermal power and hydropower. The rapid growth of China wind power industry in recent years has made China become the biggest market in the world. Meanwhile, it has created a big market for educational institutions to provide wind energy related education and training. The main objective of this study is to review current wind energy education and training in Chinese universities and training centers. Most of wind energy courses are provided by public universities because they have been accredited by Ministry of Education of China to offer students different options, including full-time and part-time degrees in Bachelor, Master or Ph.D. On-the-job training also has tremendous demand from the professionals who prefer short-term courses or on-site courses. Generally, the development of wind energy education and training lags behind the growth of wind power industry. Our study highlights the major opportunities and future challenges in China wind energy education and training.     

Assessing offshore wind resources: An accessible methodology

This paper describes a method for assessing the electric production and value of wind resources, specifically for the offshore environment. Three steps constitute our method. First, we map the available area, delimiting bathymetric areas based on turbine tower technology, then assess competing uses of the ocean to establish exclusion zones. From exclusion zones, bathymetry, and turbine tower water depth limitations, the water sheet area available for wind turbines is calculated. The second step is calculation of power production starting from available area, which determines the location and count of turbines. Then existing wind data are extrapolated to turbine height and, along with the turbine power output curve, they are used to establish the expected electric power production on an hourly basis. The third step calculates market value based on the hourly electric market at the nearest electric grid node.To illustrate these methods, we assess the offshore wind resource of the US state of Delaware. We find year-round average output of over 5200 MW, or about four times the average electrical consumption of the state. On local wholesale electricity markets, this would produce just over $2 billion/year in revenue.Because the methods described here do not rely on constructing meteorological towers nor on proprietary software, they are more accessible to a local government, state college, or other organization. For example, these methods can be carried out as an initial assessment of resources, or by a government or public entity as a check on claims by private applicants.     

Factors influencing the technology upgrading and catch-up of Chinese wind turbine manufacturers: Technology acquisition mechanisms and government policies

This paper uses firm level data for the Chinese wind turbine manufacturing industry from 1998 to 2009 to quantify the effects of technology acquisition mechanisms – purchasing production licenses from foreign manufacturers, joint design with foreign design firms, joint-ventures and domestic R&D – on wind turbine manufacturers' technology levels (as measured by turbine size, in megawatts). It also examines the impacts of government policies on manufacturer technology levels. Technology upgrading (measured by increase of turbine size) and catch-up (measured by decrease in the distance to the world technology frontier in terms of turbine size) are used to measure advances in technology level. Results from econometric modeling studies indicate that firms' technology acquisition mechanisms and degree of business diversification are statistically significant factors in influencing technology upgrading. Similar results were found for the catch-up variable (i.e., distance to the world technology frontier). The influence of government policies is significant for technology upgrading but not catch-up. These and other modeling results are shown to have implications for both policymakers and wind turbine manufacturers.     

Large scale wind power integration in China: Analysis from a policy perspective

Between 2006 and 2010 the installed capacity of wind power in China has doubled and by 2010 China's cumulative installed capacity of wind power ranked the first in the world, surpassing the United States. However, the rapid expansion of installed capacity has not been matched by grid connection, and this deficiency has aroused the concern of both policy makers and scholars. Unlike most of the current studies which focus on technical strategies in China's wind power industry, this paper analyzes the problem from a policy perspective. The paper analyzes the four challenges that large scale wind power integration in China faces: the uncoordinated development between wind power capacity and power grids; the lack of suitable technical codes for wind power integration; the unclear nature of the grid companies’ responsibility for grid connection; and the inadequate economic incentives for grid enterprises. To address these problems, the paper recommends that the government: formulates policies to better coordinate the development of wind power and the planning and construction of power grids; establishes grid codes that reflect in particular the requirements to be met by users of power transmission and distribution networks; and integrates administrative intervention and economic incentive policies to stimulate the grid enterprises’ enthusiasm to absorb wind power generation.     

Review on wind power development and relevant policies in China during the 11th Five-Year-Plan period

Since 2005, there has been dramatic progress in China's wind power industry. The annual growth rate of newly constructed capacity reached a miracle of 105% and the total installed capacity has increased from 1.27 GW in 2005 to 44.73 GW in 2010, which has exceeded the target of China's energy long-term planning for 2020. During the 11th Five-Year-Plan (FYP), the Chinese government has issued a series of polices to promote and regulate the development of wind power industry, which is the underlying force driving its rapid development. This paper is a systematical review on the current status and policies of wind power industry in China. Firstly the current status including achievements and shortcomings is presented, and then the relevant polices and regulations released during the period of 11th FYP are reviewed. Meanwhile, the main approaches of the policies and regulations in promoting the development of wind power industry are discussed and the issues of the current policies are analyzed. Finally, the paper concludes on the perspectives of wind power policies in China.     

Wind power in China: Policy and development challenges

The capacity of the Chinese wind power sector has increased rapidly over the past half-decade, essentially doubling every year since 2005. The purpose of this paper is to describe the industry’s recent development and to discuss some of the policies and policy challenges related to the particular business environment in China. Three issues are highlighted: pricing policies, transmission capacity, and the structure of the equipment manufacturing industry, where substantial overcapacity is emerging as a serious problem.     

Wind power in Taiwan: Policy and development challenges

The main aim of this paper is in discussing the outcome of the government's policies aimed at promoting the wind power industry. By analyzing the policies on renewable energy and the direct and indirect support mechanisms, the author reviews the achievements, limitations and strategies faced during their various stages. This research discovered that the series of measures adopted between 2000 and 2005 including installation plans, financial incentives, feed-in tariffs, export credit subsidies and R&D, helped to initiate the early steps of private investment, and allow domestic wind capacity to see stable growth. After 2005 with more clear goals set for wind energy installed capacity policies, R&D and industrial cooperation mechanisms, there was even greater breakthrough in limited market, enabling Taiwan's fledgling wind power industry to take its first steps onto the international production chain. In particular, the passing of the Renewable Energy Development Act in 2009 incited rapid growth in the domestic market as well as driving further development in the domestic wind energy industry. Overall, in current stage there is a need to get a handle on the gap still existing between international technology and market and that in Taiwan, in order to strategically develop a competitive advantage globally.     

风能利用可望成为我国21世纪的新兴产业

介绍了发达国家风力机工业发展概况及风力机制造业的技术特点,介绍了国内的现状,讨论了国产化与产业化的可能性,分析了经济效益与社会效益。     

Status and problems of wind turbine structural health monitoring techniques in China

Wind energy is an important renewable energy source because of its reliability due to the maturity of the technology, good infrastructure and relative cost competitiveness. Rich wind resources and strong support in regulations by the Chinese government have enabled the wind power industry to grow at a fast speed and the primary market scale has been achieved, making it the second largest wind power market in the world. There has also been an increase in wind energy research in various regions in China during the last few years. As utility-size wind turbines increase in size, and correspondingly their initial capital investment cost, there is an increasing need to monitor the health of these structures. However, most of the research papers in China are about the manufacture and production, such as the simulation of the wind turbine generator system model, the systematic resonance and stability for the world turbine, the wind speed, wind power and pitch adjustment simulation model, and so on. Few papers focus on the structural health monitoring (SHM) techniques of the wind turbine. In this paper, we review the status of the current SHM techniques in wind turbine and analyze the problems of them in China. The aims of this paper are to let more scholars and experts know the status of the current SHM techniques and to do something for building a successful industry in China.     

Investigation on wind power potential on Hong Kong islands—an analysis of wind power and wind turbine characteristics

This paper discusses the potential for electricity generation on Hong Kong islands through an analysis of the local weather data and typical wind turbine characteristics. An optimum wind speed, u_op, is proposed to choose an optimal type of wind turbine for different weather conditions. A simulation model has been established to describe the characteristics of a particular wind turbine. A case study investigation allows wind speed and wind power density to be obtained using different hub heights, and the annual power generated by the wind turbine to be simulated. The wind turbine's capacity factor, being the ratio of actual annual power generation to the rated annual power generation, is shown to be 0.353, with the capacity factor in October as high as 0.50. The simulation shows the potential for wind power generation on the islands surrounding Hong Kong.     

Energy policy and European utilities’ strategy: Lessons from the liberalisation and privatisation of the energy sector in Romania

In the context of energy sector reforms pursued by Romanian government since 1990s, we compare and contrast the market outcomes of European utilities’ investment with the host government policy objectives. We begin with energy market reform in Romania and review governments’ efforts to attract foreign direct investment (FDI) and to gradually withdraw from the distribution and supply segments of electricity market. Subsequently, we illustrate the scope European utilities have had, market policy and design notwithstanding, for consolidating market power through regional dominance. We examine the extent to which these utilities have sought to enhance their positions through horizontal and vertical integration, counter to the EU plans for a competitive market structure. We find that the investments of European incumbents have not been resoundingly successful: although market entrance may have been justified on long-term strategic grounds, in the immediate term, segments acquired through competitive auctions have yielded modest regulated returns. Finally, we discuss the extent to which policy makers have achieved their goals. Although the short-term benefits of a competitive market structure have reached some consumers, a renewed interest in promoting ‘national champions’ reflect frustration with market mechanisms as a means of ensuring long-term strategic investments in the sector.     

International competitiveness of China's wind turbine manufacturing industry and implications for future development

During 2010 and 2011, China had been the largest producer of wind turbines in the world for two consecutive years. How China can transform from being the largest producer to being the strongest producer of wind turbines is currently a great concern in the industry. The purpose of this paper is to discuss this issue from the perspective of the international competitiveness of China's wind turbine manufacturing industry. Firstly, the paper establishes a model for evaluating the international competitiveness of wind turbine manufacturing industry, which consists of five first-level indexes and 10 second-level indexes. Then, the paper uses these indexes to evaluate the international competitiveness of six leading wind turbine companies in the world—Vestas (Denmark), Gamesa (Germany), GE Wind (the USA), Nordex (Spain), Suzlon (India) and Sinovel (China). The result shows that the international competitiveness of the Chinese wind turbine company, Sinovel, ranked the fifth, lagging behind Vestas, Gamesa, GE Wind and Suzlon. Finally, the paper makes in-depth analysis on the major factors that hamper the international competitiveness of China's wind turbine manufacturing industry and provides implications for future development of the industry.