Expertise, Innovation and reduction of cost of energy: Vestas experience Nicolas Wolff, VP General Manager Vestas France Conference on Cost of Wind Energy, Embassy of Germany in Paris 15 November 2012
Agenda 1. Introduction to Vestas 2. Cost structure: - Capex and Vestas - Opex and Vestas 3. Conclusion 1. Our 3 MW Turbines - Now covering all wind classes 2. The V126-3.0 MW - Unlocking the potential on low wind sites 3. The V126-3.0 MW - Based on proven technology 4. Summing Up - The V126-3.0 MW in a nutshell 5. Appendix 2 V126-3.0 MW
Introduction to Vestas
About Vestas History 1898: Blacksmith H.S. Hansen arrives in Lem 1945: VEstjysk STaalteknik A/S becomes VESTAS 1979: First turbine after agricultural vehicles, etc. 1987: Vestas Wind Systems A/S 1991: Turbine no. 1,000 2004: Merger: NEG Micon & Vestas 2005: Ditlev Engel, CEO 2010: Wind. It means the world to us. 4 Vestas Corporate presentation
About Vestas Vestas at a glance Today, we have installed over 47,335 turbines in 69 countries around the world Vestas track record >> 5 Vestas Corporate presentation
About Vestas Vestas at a glance Vestas produces nacelles, blades and towers on sites around the world. 6 Vestas Corporate presentation
Products and Innovation 7 Vestas Corporate presentation
Product and Innovation We have the longest track record in the industry Together with our customers we have reached an installed global capacity of 50GW of wind energy. This is a significant milestone for maturing the wind industry and getting wind on pair with oil and gas. Vestas has installed more than 47,000 turbines in 69 countries, which generate electricity equivalent to the consumption of all households in Spain and Sweden These turbines save the world from 55 million tons of CO2 emissions every year.
The longest track record in the industry a solution for every site condition IEC III IEC II IEC I V80-2.0 MW V80-2.0 MW GridStreamer V90-1.8/2.0 MW V90-1.8/2.0 MW GridStreamer V100-1.8/2.0 MW V100-2.6 MW V112-3.0 MW ONS V90-3.0 MW V112-3.0 MW OFS V126-3.0 MW V164-7.0 MW OFS 6 6.5 7 7.5 8 8.5 9 9.5 10 10.5 11 9 Max. average wind speed according to IEC [m/s]
Cost structure: Capex & Vestas 10 V112-3.0 MW Onshore
Many factors influencing cost structure: External Cost of material Internal Weather conditions Inflation Steel prices Learning curves Innovation Production methods Standardization Cost of labour Scalability Regulations Licensing procedures Site characteristics 11 V112-3.0 MW Onshore
Some references: Wind Energy cost structure*, EWEA 2009 Several factors to be taken into account Investment (Euros 1,000/MW) Share of Total Cost% Turbine 928 75,6 Grid Connection 109 8,9 Foundation 80 6,5 Land rent 48 3,9 Electric Installation 18 1,5 Consultancy 15 1,2 Financial Costs 15 1,2 Road Construction 11 0,9 Control Systems 4 0,3 Total 1227 100 Table 0.1.: Cost structure of a typical 2MW wind turbine installed in Europe. Source: The economics of wind energy, EWEA 2009. Development costs are not taken in consideration here. 12
Some references: Bloomberg Wind Turbine Price Index 2012 More than 20% price drop from 2009 13 V112-3.0 MW Onshore
CAPEX and Vestas: Different elements are contributing to the decrease Production & Logistics Innovation - Lean/Six Sigma: processes excellence - Supply chain - Learning curves: less time for production - Larger rotor sizes - Aerodynamics - Turbine Design (eg.: nacelle) - Scale economies & Global Footprint 14 V112-3.0 MW Onshore
Innovation: larger rotor sizes enabling higher production In the last 30 years Vestas has: Swept area 2600+m 2 Increased rotor diameter 10 folds Increased rated power 100 folds 30 kw 3 000 kw 15 V126-3.0 MW
An example: the new born V126-3.0 MW Swept area 2600+m 2 A new family member for low-wind sites (IEC IIIB) V80/V82/V90/V112 technology Experience and Testing 6 November 2012: first V126-3MW order received in Finland 6 weeks after the its launch 27% larger swept area than V112-3.0 MW providing exceptional high energy capture in low wind 16 V126-3.0 MW
Cost Structure: Opex and Vestas
OPEX and Vestas Factors influencing OPEX decrease Turbine Trends: average cost/mwh decreases with higher nominal power Average Cost to serve (Euros/MWh)* 14 3 12 10 2 8 1 6 4 C 2 0 850-kW 2MW 3MW Average Cost (Euros/MWh) Nominal Power Source: Vestas internal estimations 18
Bloomberg O&M Price Index: 38% drop in O&M costs during the last four years «BNEF s findings show manufacturers led by as Vestas Wind Systems A/S are bringing down prices, making the machines more profitable for power providers to run.» 19
OPEX and Vestas: 1. Predictive Maintenance Vestas Performance & Diagnostic Centre By handling real-time data from 20,000 turbines we know more about wind than anyone else. Vestas Condition Monitoring System Assesses the health of the turbine by analysis of measured signals Estimation of time of failure provides optimised planning of maintenance activities 20
OPEX and Vestas 3.Turbine design: better serviceability Ex.: V112-3MW - Designed for one year service interval - Work area in nacelle increased by 60% over previous Vestas turbines - Easier access to tools, enough space to do service, etc) 21
To conclude:
To conclude: Wind: a competitive industry Decreasing curves compared to other industries Next challenge: working towards the Grid Parity 23
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