Editor's Note: This post originally appeared on GE's Power Conversion blog.
By Sofia Sauvageot
Competing in the wind industry is like playing in a professional soccer league. You need your star players, a tailored strategy and a drive to make your fans proud. And, while a decade ago wind may have been at the bottom of the power generation league, it’s rising up the table fast, almost catching up to the big players — traditional thermal power sources and natural gas.
Numbers say it all. Globally, progress in the wind sector continues to be strong with increasing annual installed capacity and growing investment in the sector. In 2015 alone, 63,013 megawatts of wind power capacity was installed globally, an annual market growth of 22 percent. It is continuing its progress towards becoming a mainstream, competitive and reliable power source in both developing and mature markets. In fact, wind is becoming cheap enough in many places in the U.S. and around the world to compete effectively with fossil fuels.
As wind energy continues to gain ground, let’s take a look at three main trends we’re seeing in the industry moving forward:
Throughout the wind sector, this type of partnership and collaboration is crucial. Battling challenging cost targets and the need to build wind power closer to urban areas, wind operators must form long-term strategic collaborations to maintain and increase wind’s competitive edge. Maintaining a long-term partnership with a supplier or original equipment manufacturer will not only save time, but can also save costs through economies of scale. What’s more, through working with one supplier, wind operators can decrease the admin and supply chain complexity and feel assured that all elements of their business are working together smoothly. This can help to standardize and rationalize components needed throughout the wind farm operational life cycle, reducing timely and costly re-engineering.
The formation of strategic partnerships can not only benefit the industry as a whole, but also advance a company’s position in the marketplace. They enable parties to tap into each other’s knowledge, accelerating innovation and supporting the development of new and improved technology. Right now, turbine manufacturers have to search for the best component to fit their turbine. In the future, however, we expect to see a shift to where operators no longer focus on repeat negotiations of contract and price, but instead move towards developing products together — in partnership. Through this collaboration, components and turbines could be designed together to ensure seamless integration and improved reliability and efficiency.
However, while positive for many, this change is not great news for certain suppliers. Companies without local manufacturing capabilities could find themselves at a disadvantage, as building local production and test facilities can be capital intensive and time consuming. Players with a global footprint in manufacturing and production, such as GE, however, are already equipped to handle the growing trend for localized products as they can utilize their local expertise and knowledge in each individual market.
This local expertise and knowledge is key because each market has differing targets and goals for wind power. For example, the Chinese government is actively spurring on wind development to meet rising electricity demands and limit its reliance on polluting coal-fired power stations. Therefore, projects move much faster there compared to many other countries. Understanding the nuances of the practices and policies that surround the industry is crucial to succeeding in each market, which is another reason why wind operators need to consider partnering with suppliers that have a truly global presence.
Digital technology sits at the heart of meeting this challenge. GE is continuing to collaborate with the industry to embrace a technology and data-driven approach, investing heavily in software and machines to transform the industry. For example, using its Industrial Internet expertise, GE has developed the world’s first digital wind farm.
As the wind industry continues its rise in the global energy production league, there are high hopes that it will become a star player in the power generation market in the not so distant future.
Image credit: Pixabay
Sofia Sauvageot is the Global Sales leader with the global lead for the wind business for GE Power Conversion. She has been working since 2010 with Electric drive trains for Renewables and before that in Marine business for 10 years.