The success of maturing technologies and falling costs have led the world to finance USD 282 billion of renewable capacity, with wind leading the way at USD 138 billion.
The costs of wind power have dropped 49 percent from a decade ago. That means it’s now possible to turn profits on the energy sources that can help lower greenhouse-gas emissions (GHG), and investors are piling in.
According to UN Environment Program and Frankfurt School of Finance and management, renewable energy drew more than USD 2.6 trillion in investment from 2010 to 2019. Building new wind or solar capacity now costs less than adding the equivalent in coal or gas plants in two-thirds of the world. Investment has pushed wind energy to almost 9% of global generating capacity.
How did it all happen?
For thousands of years, people have been using the wind's energy for electricity. But how did it develop into a clean, abundant and free solution to tackling global warming?
The history of wind energy is captured along the Nile River as early as 5,000 BCA when people used wind energy to propel boats. Later around 200 BCA, simple wind-powered water pumps were used in China, and windmills with woven-reed blades were grinding grain in Persia and the Middle East.
New ways to use wind energy eventually spread around the world. By the 11th century, merchants and the Crusaders brought wind technology to Europe. The Dutch developed large wind pumps to drain lakes and marshes in the Rhine River Delta. Immigrants from Europe eventually took wind energy technology to America.
American colonists used windmills to grind grain, to pump water, and to cut wood at sawmills. In the late 1800s and early 1900s, small wind-electric generators (turbines) were quite common in the US.
Unfortunately, when power lines were built to transmit electricity to rural areas in the 1930s, wind pump and small turbine use began to decline. Wind generators couldn’t compete against fossil fuel plants and centrally generated electricity.
However, the oil shortages of the 1970s changed the energy environment for the US and the world. The members of the Organization of Arab Petroleum Exporting Countries (OPEC) proclaimed an oil embargo – targeted at nations perceived as supporting Israel during the Yom Kippur War.During the 1970s the price of oil had risen nearly 400%, from USD 3 per barrel to nearly USD 12 globally – US prices were significantly higher as the country was the main target of the embargo. The embargo caused an oil crisis, or a ‘shock, with many short- and long-term effects on global economy and politics.
The oil shortages created an interest in developing alternative energy sources, such as wind energy, to generate electricity. Since the mid-1970s, the US and Europe have supported research and development of large wind turbines. For instance, in the early 1980s, thousands of wind turbines were installed in California, largely because of federal and state policies that encouraged the use of renewable energy sources.
As a result, the share of the US electricity generation from wind increased from less than 1 percent to 7 percent within the period 1990 to 2018. Incentives in Europe have resulted in a large expansion of wind energy use. According to WindEurope Business Intelligence 2018 annual report, Denmark is the country with the highest share of wind energy in its electricity demand (41%). The UK registered the largest annual increase of wind energy in its electricity demand, from 13.5% to 18%. Ireland (28%), Portugal (24%), Germany (21%) and Spain (19%) are the other countries with the highest share of wind in their electricity mix.
Moreover, climate change triggered a rapid increase in wind speeds over the last 10 years. Emerging economies are also installing large windfarms.
In particular, China is investing heavily in wind energy and now has the world's largest wind electricity generation capacity.
China’s companies in wind energy
China has identified wind power as a key growth component of the country's economy. The Chinese government has set out a road map for wind power up to 2050. Wind power capacity goals are to reach 400 GW by 2030 and 1,000 GW by 2050.
When looking at numbers for wind energy production, China stands above all other countries. Figures released by the Global Energy Council last year showed that China has installed far more wind power capacity, both on land and at sea, than any other country.
Here are some of China’s wind turbine manufacturers:
Goldwind Science & Technology:
Goldwind’s work began in the 1980s when, with the support of China’s State Science and Technological Commission and its Ministry of Water Resources, the company increased Chinese wind capacity from 2,050KW to 6,100KW.[1]
Today, it operates on 6 continents, has more than 8,000 employees and over 44GW of installed wind capacity around the world. The firm claims to contribute more than nine billion tones to annual CO2 reduction and the equivalent of almost five billion cubic meters to reforestation each year.
According to GlobalData, Goldwind installed 7GW of wind turbine capacity in 2018, equivalent to 13.7% of the global total.
China Ming Yang Wind Power Group Limited:
The company started wind turbine production in 2007. Currently it is the largest private wind turbine manufacturer in China and the fifth largest overall in the country. The company listed on the New York Stock Exchange (NYS:MY) in October 2010, and delisted six year later on June 22, 2016.
Ming Yang is focusing on designing, manufacturing, selling and servicing megawatt-class wind turbines. The company also cooperates with aerodyn Energiesysteme, a wind turbine design firm based in Germany.
Guodian United Power Technology:
Guodian United Power Technology is engaged in development, investment of power construction, operation and management plants and power generation for electricity supply in Sichuan and Chongqing, Shandong, Yunnan, Guizhou, Guangxi, and Xinjiang, as well as in Burma.
The company mainly produces onshore wind turbines of size 1500 kW – designed by the German development company aerodyn Energiesysteme.
Shanghai Electric Wind Power Equipment:
Shanghai Electric Wind Power is one of China’s biggest wind turbine makers that in 2018 accounted for 43.9 percent of the country’s total offshore wind power installations. The company is also the manufacturer of China’s largest turbine – an 8-MW offshore machine, a prototype of which was delivered last year based on licensed Siemens Gamesa technology. Moreover, it is also researching a 10-MW design.
What are the challenges for Chinese companies?
Although Chinese wind energy original equipment manufacturers (OEM) have a potential in leading the global offshore wind order rankings in years to come, there are two main challenges to be addressed.
First, the enormous size of offshore wind turbines increasingly demands localized manufacturing, which Chinese OEMs might find hard to establish outside of China.
Second, and more importantly, is technology. Chinese manufacturers have yet to achieve the turbine sizes now offered by European OEMs, such as the 9.5-megawatt machines that MHI Vestas will be supplying to Vineyard Wind's 800-megawatt project off the southern coast of Massachusetts, or the 8-megawatt turbines Siemens Gamesa is selling into Taiwan.
For these reasons, “the Chinese manufacturers will be pretty much restricted to the Chinese market for the foreseeable future,” said Luke Lewandowski, Director at Wood Mackenzie Power & Renewables.