EUROPEAN INVASION, WIND

Yes, wind has costs. Yes, it requires investment. But what is the longterm downside? And what is the longterm downside to investment in coal and nuclear?

"I really like change that doesn't have any downside risk." T. Boone Pickens, on the coming fight against global warming.

European wind-energy firms look to U.S.
Alan Zibel, April 29, 2007 (Philadelphia Inquirer)

WHO
German, Spanish and Danish wind energy companies

WHAT
- EDP - Energias de Portugal S.A. bought Houston-based Horizon Wind Energy from the Goldman Sachs Group Inc. for $2.15 billion.
- Vestas Wind Systems A/S of Denmark announced plans to build its first U.S. plant, a $60 million wind-turbine blade factory.
- Spain’s Gamesa Corporacion Tecnologica S.A.bought Minneapolis wind-farm developer Navitas Energy Inc.
- Spain’s Iberdrola S.A. (the biggest owner of wind farms worldwide), with its $22.5 billion acquisition of Britain's Scottish Power P.L.C., gains control of Oregon-based wind developer PPM Energy Inc., the second-largest U.S. wind-farm owner.

WHEN
- Deals have been made, are being made, will soon be made. At this rate, wind can be 5% of electricity by 2010 and installations will double by 2011.
- Wind turbine world sales: $25.1 billion, 2007; $49.4 billion, 2011.
- Gamesa Corporacion Tecnologica bought Navitas in 2002, signed a $300 million deal in 2006 w/Royal Dutch Shell.
- General Electric Co. supplied 59 percent of installed U.S. wind capacity in the United States in 2005, 47 percent last year. Siemens, Vestas and Gamesa together had 44 percent of the U.S. turbine market in 2006.

WHERE
- Spain’s Gamesa Corporacion Tecnologica S.A. makes wind turbines in Pennsylvania and develops wind farms in the U.S.
- Vestas Wind Systems’ U.S. plant is in Windsor, Colo.
- German industrial giant Siemens AG turned a shuttered truck trailer factory in Fort Madison, Iowa, into wind turbine blade factory.
click to enlarge
WHY
- The U.S., with only 1% of electricity coming from wind, has barely been tapped (Denmark: 20%, Spain: 9%).
- Vestas shares have more than doubled; Gamesa shares are up 70%.
- Stronger commitment to the development of renewable energy in the U.S. makes investments for attractive:
1. The federal tax credit for wind energy has been extended through 2008
2. 21 states now have legislated goals for obtaining electricity from renewables
3. Wind energy technology (tower height, blade length and efficiency) is making wind more economically viable.

QUOTES
- Michael Peck, spokesman for Spain’s Gamesa Corporacion Tecnologica S.A.: "We're like the Saudi Arabia of wind, and we just haven't had the big exploration boom yet…"
- Thomas Emmons, HSH Nordbank AG: "The U.S. is a bigger area that [European companies] can look to for growth…"
- Ron Pernick, Clean Edge Inc.: "We could have had our own homegrown wind-power companies competing for these new wind-farm developments and manufacturing [plants] had we had the right policies in place…"
- U.S. Energy Information Administration: Wind-generated electricity, intermittent and often located distant from urban centers of high demand, is more expensive than coal or natural gas but cheaper than nuclear power and far cheaper than solar…