This is Vestas - from wind to customer
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1 Vestas Wind Systems A/S Hedeager Aarhus N. Denmark Tel: Fax: vestas.com This is Vestas - from wind to customer 2017 Vestas Wind Systems A/S. All rights reserved. This document was created by Vestas Wind Systems A/S on behalf of the Vestas Group and contains copyrighted material, trademarks and other proprietary information. This document or parts thereof may not be reproduced, altered or copied in any form or by any means without the prior written permission of Vestas Wind Systems A/S. All specifications are for information only and are subject to change without notice. Vestas Wind Systems A/S does not make any representations or extend any warranties, expressed or implied, as to the adequacy or accuracy of this information. This document may exist in multiple language versions. In case of inconsistencies between language versions the English version shall prevail. Certain technical options, services and wind turbine models may not be available in all locations/countries. 09/2017-EN
2 Wind. It means the world to us. This is true today, was true 30 years ago, and will be true in 30 years. Wind is Vestas business and passion. Vestas commitment to continuous improvement in technology, service, and operational excellence will ensure that Vestas is the undisputed global wind leader. Something Vestas can achieve if we continue to put all of our efforts into delivering best-in-class wind energy solutions. That is Vestas vision, and this is Vestas value proposition: Developing and building wind turbines and service solutions are only part of our business. Today, Vestas is involved in projects where the scope of work ranges from simple supply and commissioning projects to turnkey solutions involving the supply, installation, and commissioning of wind turbines, as well as access roads, foundations, cabling, electrical substations, communication systems, and more. As a result, our value chain stretches across project planning, procurement, manufacturing, construction and installation through to operation and maintenance. It is a complex process that depends on a highly skilled and dedicated workforce. Project planning and design Procurement and manufacturing Construction and installation Operation and maintenance Corporate Strategy After completing a successful turnaround, Vestas launched the Profitable Growth Strategy in 2014, with the objective to deliver profitable growth. Vestas is executing on the strategic objectives and meeting the targets with the result that Vestas is now stronger than ever across the business. In the coming years, the strategic ambition is to further develop and expand Vestas market position. Profitable growth will continue to set the direction. Vestas will continue to work diligently on strengthening its position further by also taking advantage of the opportunities ahead. Vestas wants to grow in a profitable way, as generating profit will allow Vestas to further expand its business and achieve its ambitions. At the same time, Vestas needs to prepare for the future to beat the increasing competition on all parameters. To do so, Vestas will build further on its capabilities to integrate new technologies in its product portfolio and at the same time ensure the lowest possible levelised cost of energy. Improving its competitiveness also requires Vestas to adapt its organisation to succeed in rapidly evolving market conditions To this end, Vestas has defined four strategic objectives which provide the operational basis for the implementation of the strategy. 1. Global leader in the wind power plant solutions market Vestas will continue to focus on profitable growth in all markets, partnering more closely with its customers, expanding its key account programme, involving customers in product development, and working closely with them to deliver tailored solutions. 2. Global leader in the service solutions market Vestas has installed 87 GW on six continents and service 73 GW across the globe at the end of October Together with Vestas industry-leading quality and a Lost Production Factor under 2 percent, Vestas has an unparalleled track record within operation and service of wind turbines 3. Lowest cost of energy solution For more than 35 years, Vestas has been driving down the cost of energy in the wind power industry and been at the heart of the technological progress. Vestas has a clear ambition to sustain this downward trend and lower the cost of energy faster than anyone in the wind power industry by bringing commercially valuable products and services to the market. 4. Best-in-class global operations Vestas will continue to build its strength within its core business in 2017 and beyond. The overall strategic ambition is to ensure profitable growth for Vestas and expand its global leadership. Vestas has come a long way and will continue its journey to create an even more flexible and robust company. 2 This is Vestas This is Vestas 3
3 Product, technology and service strategies Product and technology strategy Being the global wind leader requires a long term line of sight into our technology development. We want to bring commercially valuable, game-changing ideas to the market in a profitable way. The Vestas technology strategy derives its strength from market-driven product development and extensive testing at the wind industry s largest test facility located in Denmark. This enables Vestas to continuously innovate and effectively integrate proven technologies to create high-performing products and services in pursuit of Vestas overriding objective: lowering the cost of energy. By building on our two platforms (2MW and 4 MW Platform), we secure our ability to grow profitably and deliver highly competitive products and services for our customers projects in all wind classes. For Vestas, industrialisation means moving from a one-size-fitsall approach to custom configurations based on modularised building blocks that enable Vestas to offer our customers tailored solutions to meet project-specific requirements. The modularity increases the flexibility of our product range by combining different modules with standardised interfaces, making it possible to optimally configure the turbine for the local wind and grid environment. The Vestas product range can thus match an increasingly wider variety of wind conditions, even within the same wind class, and in this way optimise turbine output and strengthen the customer s business case. More so than in the past, Vestas works with external technology and innovation partners such as suppliers, research institutes, and universities as well as adjacent industries. This approach gives Vestas insights and access to new, innovative technologies and materials that may already be in use in other ways. We integrate these external technologies in unique ways that result in new products or configurations that contribute to efficiently increasing power output and lowering the cost of energy. In line with this innovative thinking, Vestas installed a multi-rotor concept demonstration turbine in April 2016, in cooperation with the Technical University of Denmark. The aim is to assess if we can build an even more cost-efficient turbine by challenging the core scaling rules that turbines have to grow in size to increase their energy output. Profitably bringing marketdriven, innovative solutions to our customers through: Custom configurations based on modularised building blocks for tailored customer solutions Broad and flexible product range to precisely match the best turbine for site specific conditions Broader collaboration with external partners to create innovative solutions, integrating external technologies in new and unique ways Service strategy The Vestas service business is a key element in the company s long-term profitable growth strategy. With data derived from the world s largest installed capacity and over 35 years of technical insights, our goal is to release the full potential of our customers wind business. That is why a service partnership with Vestas stands apart. Our service offerings are divided into four business areas Maintenance Partnering, Parts and Repair, Fleet Optimisation, and Data & Consultancy Services each of which contributes to increasing performance and lowering the cost of energy. We work closely with our customers to tailor service packages to meet specific needs and site-specific wind park requirements. Responding to our customers evolving demands, we offer a new generation of flexible fleet optimisation capabilities such as advanced plant and data management, diagnostics, and forecasting. Vestas extensive data processing and asset management capabilities enable us to anticipate and plan service requirements. This means that we have been able to keep a fleetwide Lost Production Factor consistently under two percent. Vestas technology and service know-how are mutually reinforcing elements in maximising wind park output and lowering the cost of energy. In short, as customer requirements continuously evolve, Vestas is evolving to meet them by tailoring our service approach to include complete asset management solutions. Combined with our ability to continuously improve the productivity of Vestas turbines throughout their operating lifetimes, we provide an unbeatable combination that will enable us to capture the full potential of the service business. Our goal of becoming a fleetwide lifetime service partner for our customers is also supported by the recent acquisitions of the independent service providers Availon and UpWind Solutions. And as a result, Vestas now has 8 GW of non-vestas turbines under service. Vestas services 73 GW equal to more than 37,500 wind turbines in 65 countries, which represents the largest installed base in the wind industry. Our service business focuses on: Four service areas Maintenance Partnering, Parts and Repair, Fleet Optimisation, and Data & Consultancy Services each of which contributes to increasing performance and lowering the cost of energy Flexible fleet optimisation capabilities such as advanced plant and data management, diagnostics, and forecasting Extensive data processing capacity to anticipate and plan service requirements Tailored service solutions, including complete asset management offerings We will leverage on our technology and service leadership achieved through years of continuous improvements to meet evolving demands, to capture the full lifetime value of any wind energy investment and to deliver excellent cost of energy. 4 This is Vestas This is Vestas 5
4 Our vision, mission and values With the ever evolving energy market bringing new opportunities, Vestas innovates sustainable energy solutions that help power a bright future for countries, companies and people globally. Vision and mission Vestas vision and mission serve as important beacons for uniting all Vestas key stakeholders, most importantly its employees, setting a clear purpose and direction for where the company is heading and how the employees can support that journey Vision To be the global leader in sustainable energy solutions, meaning: Lowest cost of energy solutions Preferred partner Leader in revenue Best-in-class margins Mission Deliver best-in-class energy solutions to the benefit of Vestas customers and the planet To achieve that mission, we are inspired by our values of Accountability, Collaboration, and Simplicity. These reflect our guiding principles in terms of how we work and engage with each other internally and with the full range of stakeholders externally. Accountability We are accountable for everything we do and towards everyone with whom we interact. We acknowledge the responsibility we each have to contribute to the success of Vestas, and we take responsibility for our actions. Collaboration We recognise that we are stronger as a team than as individuals. We continuously work to ensure we collaborate internally with our colleagues and externally with our customers, suppliers and other stakeholders. Simplicity We are part of a highly complex environment. By responding with simplicity, we are able to quickly adjust to possible changes and deliver as promised in a speedy manner without compromising safety or quality. 6 This is Vestas This is Vestas 7
5 Social and environmental standards Sustainability inherent in Vestas way of working While Vestas creates sustainable products, we also strive to produce them in a sustainable way. Vestas believes that in the long term, it is in the best interests of the company, its employees, and its owners to be accountable for Vestas impact on its surroundings: the environment as well as the local, national, and global communities. Standards, goals, and priorities Vestas standards and goals within sustainability build on global certificates for the three standards ISO 9001 for Quality, ISO for Environment and OHSAS for Health and Safety as well as recognised conventions established by international organisations such as the UN, ILO, and OECD. These standards and goals are reflected in Vestas social and environmental priorities: The lowest possible incidence of recordable as well as lost time injuries the ultimate goal being to avoid accidents altogether. CO2 impact from wind power must excel against other energy forms. As much of the wind turbine as possible must be recyclable after decommissioning. Vestas joined the UN Global Compact in The UN Global Compact is a commitment to ten universally accepted principles in the areas of human rights, labour, environment, and anticorruption. Vestas applies the option stipulated in section 99a of the Danish Financial Statements Act concerning the duty of large enterprises to prepare a corporate social responsibility report by referring to the COP report. To take sustainability at Vestas to the next level, a Sustainability Committee with cross-functional participation has been established. The role of the Sustainability Committee is to oversee, prioritise, and coordinate cross-functional sustainability initiatives in Vestas and ensure sustained 8 This is Vestas conformity according to UN Global Compact. The committee reports to the Executive Management and the first meeting was held in 2015, with a planned meeting frequency of four times a year going forward. Code of Conduct Vestas Code of Conduct is an inherent part of Vestas approach to pursuing its strategic objectives and it is continuously being refined and improved as Vestas conducts its business. Such improvements would for instance include revising the Code of Conduct, strengthening the third-party programme, and raising awareness of the whistle-blower system EthicsLine. During 2015, Vestas has also undertaken a bribery risk assessment to ensure that bribery and corruption risks are understood and appropriately managed. Vestas Code of Conduct outlines the principles by which the company expects its employees and partners to behave. As a global company operating in many countries and being exposed to a wide range of business cultures, it is essential that the Code of Conduct is continuously reviewed to reflect the changing regulatory and business environment, and ensure it is clearly understood by both employees and partners. In order to help embed the values and principles outlined in the Code of Conduct, employees must acknowledge Vestas Code of Conduct during onboarding and at regular intervals, depending on their position within Vestas. It continues to be expected that should any employee become aware of a violation of the Code of Conduct or unethical behaviour, the employee will report this to a manager or EthicsLine. Quick facts and figures 1 Top 5 Top five markets for orders: Mexico, U.S., France, UK and Denmark. Top five markets for deliveries: U.S., Germany, France, Canada and China. Number of markets for orders: Number of markets for deliveries: (2016) (2016) Number of employees globally: +22,700 Cumulative # wind turbines installed: Cumulative MW installed: +62, ,000 MW EthicsLine Vestas employees and stakeholders should feel empowered to anonymously report unethical behaviour; to this aim the company has continued to raise awareness of the EthicsLine throughout 2015, in particular the visibility of the reporting facility. Vestas received a total of 91 inquiries through EthicsLine in 2015 compared to 46 in For all substantiated compliance cases closed in 2015, various disciplinary sanctions and other actions such as training, policy updates etc. have been taken leading to eight warnings and 15 dismissals. 1) unless otherwise noted, all figures are for Q Vestas production locations Brazil: Nacelles China: Blades; controls; generators; nacelles Denmark: Blades; controls; nacelles Germany: Blades; generators India: Nacelles; Blades Italy: Blades Spain: Blades; generators; nacelles United States: Blades; nacelles; towers This is Vestas 9
6 Safer ways to work We are proud of our safety record at Vestas, but we re always striving to reduce accidents even further by developing safer ways to work. One way we achieve this is through a Safety First approach to any actions or decisions that undermine safety no matter how small. A shared responsibility Working with wind turbines is not without risks. Heavy components in production, dizzying heights and unpredictable weather conditions during construction and service, all add up to a challenging work environment. But we refuse to accept that accidents are inevitable. Safety is paramount at Vestas, starting at the top with senior management. Individual employees also shoulder responsibility for their own well-being and the well-being of others. At a minimum we operate to the safety standards of OHSAS certification. Safety is always number one Safety is an integral part of achieving operational excellence. Over the last 10 years, Vestas has been through a remarkable journey building a strong safety culture. In 2015, Vestas changed its main safety-related key performance indicator to Incidence of total recordable injuries per one million working hours and in 2016, the incident rate was 6.9, below the full-year 2016 target of 8.0. The 2016 rate corresponds to less than one recordable incident per day for a workforce of more than 22,000 Learning lessons, safeguarding staff We monitor safety across the organisation. If an accident, near miss or hazard observation occurs, we have a detailed reporting process in place. This means we investigate what caused the incident and put measures in place to ensure it cannot happen again. We thoroughly safety-check new technologies and working practices before we introduce them, to make sure we identify any potential dangers early on. By helping to keep projects on time and on budget, safety in the workplace benefits both Vestas and our customers. Walking the walk Our managers and supervisors regularly conduct Safety Walks. This is a tour around a department, a site, or any work area to have an active dialogue with the employees about safety awareness with three main purposes: To reinforce safe behaviour and stop unsafe practises among staff, through dialogue To demonstrate we put safety first, through our presence on-site and commitment to resolving safety concerns with staff To raise safety awareness among employees and to ensure their concerns are addressed Safety first our ongoing quest We will not rest until Vestas is among the safest companies in the world to work for. Current initiatives include: Vestas Standards Developing new global safety standards within electrical safety, control of hazardous energy and many more. Safety Awareness Behaving safer, making safe decisions and being positive role models for each other. Incident Management Enhancing the Incident Management process to ensure thorough root cause analysis; effective corrective, preventive actions are implemented to eliminate future injuries. Global Wind Organisation Participating in the association of international wind turbine owners and manufacturers. The group aims to promote basic safety training for everyone involved in the construction and operation of onshore and offshore wind farms. It focuses on medical certificates, manual handling and first aid, working at heights/rescuing from heights, and fire awareness for offshore sea survival. Combined with our market making expertise, we are able to take an active part in shaping the future of the industry and lead the way in the years to come. We do this by adding a constant forward thinking mind-set to our comprehensive renewable energy knowledge and always with refreshing simplicity and stakeholder-benefit as our guiding star. 10 This is Vestas This is Vestas 11
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