The rapidly developing Chinese wind power industry is facing a new bottleneck from the upstream manufacturing industry while facing downstream bottlenecks such as “connection difficulties”.

The vicious market competition caused by the serious overcapacity of the wind power equipment industry is evolving into a "tough" price war. Many industry insiders said in an interview with the Economic Information Daily that China's wind power equipment industry will enter the era of "big waves and sands".

Status quo: wind power kilowatts installed cost and then thousands of dollars

With the intensification of the price war of wind power equipment, the cost of wind power units is showing a sharp decline. The "Economic Information Daily" reporter recently learned from Inner Mongolia, Liaoning, Hebei, Guangdong and other places that the current average price of wind power has dropped by nearly 1,000 yuan / kW compared with the same period in 2009.

“Our wind power development in Mengdong started late, but it caught up with the opportunity period of equipment market change.” Ma Yugang, general manager of Huaneng Tongliao Wind Power Co., Ltd. told reporters, “When building Baolongshan Wind Farm in 2008, the unit The average cost is 9250 yuan / kW; when the Zhurihe Wind Farm project is built in 2009, the unit cost can be controlled below 9,000 yuan / kW; currently it is expected to drop to 8,000 yuan / kW."

It is understood that despite the many constraints such as "connection difficulties", investors are more enthusiastic about the development of wind power. One of the important reasons is that the cost of wind power units is greatly reduced. Unlike developers, wind power equipment manufacturers have expressed deep anxiety in the face of intensified price wars.

Liu Dongyuan, the general manager of Guodian United Power Technology Co., Ltd., called it "the face of collective suicide in cakes." He said that in the past two years, the market price war has been in full swing, domestic wind turbine equipment prices have fallen, and profit margins are being severely compressed.

"In order to fight for the market, the price war between wind power equipment companies has been 'bloody'." Zou Changning, marketing director of Xiangdian Wind Energy Co., Ltd. warned that since last year, a considerable number of equipment manufacturers have suffered losses; A large area of closure may occur in one step. In order to survive, some "manufacturers" have to transform into "developers", that is, the transformation of wind power equipment manufacturing to wind farm development.

As a leading enterprise in China's wind power equipment manufacturing industry, Goldwind Technology also feels the tremendous pressure brought by the price war. Wu Gang, chairman of Goldwind Technology, even used the term “tough” to describe the market competition in the wind turbine manufacturing industry. "Although I always believe that the survival of the fittest is an inevitable law of market competition, proper normal competition will promote the healthy development of the industry. But the current price war has evolved into a suicidal vicious competition that will bring bad to the entire manufacturing industry. as a result of." 

According to WISCO's analysis, the intensifying “price war” is an abnormal competition that violates economic laws. As a result, it will disrupt the normal market order and affect the healthy development of the wind power industry.

Reason: low-end overcapacity leads to vicious competition

Analysis of the reasons for the price war in the wind power equipment market, the industry people invariably pointed to the "overcapacity", and "low-end overcapacity."

Once upon a time, the wind power industry, which is the “green renewable energy” that the country fully supports, has attracted the attention of all sectors of society. State-owned capital in the railway, aerospace, and weapons industries has entered the business a lot, and private capital such as mining, repairing, and air-conditioning has also been squeezed into the gold mining, and the number of wind power equipment enterprises has increased sharply.

The data shows that in 2004, there were only 6 wind turbine manufacturers in China; by the end of 2009, the number of complete machine manufacturers had grown to nearly 90. Among them, there are 57 enterprises with prototypes, and about 30 companies with more than 100 machines per year. In addition, there are more than 100 wind power equipment parts manufacturing companies and more than 50 blade production plants.

As early as the beginning of 2009, Shi Lishan, deputy director of the New Energy and Renewable Energy Department of the National Energy Administration, had issued an appeal to the industry to warn the industry of overheated investment in wind power equipment manufacturing through the Economic Information Daily. In late September of the same year, the State Council approved The Notice of Several Opinions on Reducing Overcapacity in Some Industries and Reducing Construction and Guided Healthy Industrial Development by the National Development and Reform Commission and other departments has made it clearer that the blind expansion of wind power equipment production capacity should be strictly controlled.

"Although the speed of China's wind power industry development is the first in the world, the expansion of wind power equipment capacity far exceeds the demand of the industry. Therefore, price war is inevitable." Shi Lishan said from the perspective of industry development, "price war is The result of market competition, but we hope to be orderly competition, not disorderly vicious competition."

The international wind power equipment giant Vestas concerned also expressed concern about the price war in the Chinese market when interviewed by the Economic Information Daily. However, this person also believes that China's current market competition is basically a competition for low-end production capacity. Because, in addition to the strong companies such as Goldwind, Huarui, Dongqi, most of the wind turbine manufacturers only carry out the whole machine assembly through the transfer of foreign technology, and do not have strong competitiveness; and the world's leading wind turbine Enterprises are reluctant to transfer first-class technology to others, which is why Vestas still increases its investment in the Chinese market.

"Big waves and sand, the price war will accelerate the reshuffle of China's wind power equipment industry." Through the price war's heavy "smoke", WISCO deeply analyzed that "on the one hand, the current price war is due to the excess of low-end production capacity, competition As a result, some low-end manufacturing companies with small scale and no core technology and R&D strength will be eliminated. On the other hand, in the high-end technology field, the market space is still very large. Therefore, relying on independent research and development capabilities and brand advantages, Seizing the commanding heights of technology, this is the magic weapon for Goldwind to get rid of the current price competition and win the market."

Way out: Defending the domestic market to expand overseas space

In the face of price wars, where is China's wind power equipment manufacturing industry? Insiders pointed out: "In the long run, China's wind power equipment manufacturers should digest excess capacity by tapping two markets at home and abroad."

“Compared with the overcapacity of traditional industries such as steel and cement, the overcapacity of domestic wind power equipment should be said to be a relative surplus.” Li Xinqu, a researcher at Bohai Securities, believes that on the one hand, it is relatively constrained by the grid bottleneck, and wind power consumption is insufficient. The rapid development of the wind power industry; on the other hand, although wind power installed capacity is growing fast, compared with China's wind energy resources, wind power development prospects are still very broad.

Qin Haiyan, secretary-general of the China Wind Power Industry Association, called on the relevant state departments to adopt market-based means as soon as possible to guide the orderly development of China's wind power industry, such as establishing an industry access system as soon as possible, and improving the entry threshold of the whole machine manufacturing industry; The manufacturer "goes out" to participate in international market competition.

According to the data, in the past 30 years, the global installed capacity of wind power has maintained a growth rate of 20% per year. With the gradual release of new energy policies in various countries, the demand for wind turbines in the international market will be three to four times that of the domestic market. The annual demand for international wind power equipment is expected to be 50 million kilowatts this year. "This is undoubtedly a tempting cake." Han Shuwang, vice president of China Academy of Launch Vehicle Technology and chairman of China Aerospace Wanyuan International Group Co., Ltd. said: "China's wind power equipment manufacturers must actively participate in the domestic market competition, they must Accelerate participation in international market competition and expand a broader and broader space for survival and development."

The voices from the international market show that China's wind power equipment companies with independent innovation capabilities, such as Goldwind Technology, Sinovel, and Dongfang Electric, are stepping up their “going out” pace. A survey by the Danish consulting firm BT M said that although Denmark's Vestas and General Electric are still holding the top two global wind turbine suppliers, Chinese companies are catching up. China's Sinovel, Goldwind and Dongfang Electric are among the top ten in the world, and Chinese companies are actively competing in the export market.

Huarui Wind Power, currently ranked third in the world, exported 10 sets of 1.5 MW wind turbines to India in 2009, and purchased electrical systems from American Superconductor Company in March this year for its own research and development of 5 MW. Used by wind turbines. Han Junliang, chairman of Sinovel, said with ambitiousness that "the company plans to export such large-capacity wind turbines in the future."

Goldwind Technology acquired a 70% stake in Germany's V EN SY S Energy Co., Ltd. two years ago and established a production base in Germany. It became the first domestic company to have complete independent research and development design capabilities and complete autonomy. A wind power machine manufacturer with intellectual property rights, and thus obtained a license for Chinese wind power products to enter the international market. Last year, Goldwind Technology established a subsidiary in Australia and established a subsidiary in the United States this year. Foreign power said: The establishment of the Golden Wind Technology Chicago subsidiary announced that the Chinese company began to attack the US market dominated by General Electric.