Top Turbine Makers Fear for Wind Power to Become too Cheap
As investment in green energy is increasing and the cost of wind energy is falling rapidly amid the climate change
Wind power is a sustainable and renewable source of energy. Climate change has effectively helped in lowering the cost of wind power to an extent that now it can compete with fossil fuels. However, the top turbine makers fear that wind power will become too cheap, which could reflect badly on the market.
The head of Siemens Gamesa cautioned that the race to lower down the cost of generating wind energy will end because it would affect the turbine producers financially, potentially restrict them to invest in new technologies.
Chief Executive Andreas Nauen, Siemens Gamesa, explained;
What we’ve clearly achieved is that wind power is now cheaper than anything else. But I believe we shouldn’t make it too cheap.
According to Bernstein Research, wind and solar power in Europe are considerably cheaper than coal, natural gas and nuclear power. There has been a rapid rise in the demand for wind turbines but the lower prices and high demands have increased the competition exceeding all the limitations.
If the prices of wind power continues to fall, the industry would not be able to invest in any other technology resulting in decreased factories, Nauen mentioned.
The turbine makers have also to deal with the rising cost of raw materials like steel. Siemens Gamesa and its major rival Vestas agreed that they have been able to pass on part of the higher costs to customers that may be redirected in higher auction prices.
Government bodies across the world are giving wind subsidies, preferring more reasonable contract tenders. There is a need for change in auction systems, Nauen emphasized.
He also suggested that the major focus should not be price but should be on the things like local job creation. A balance between the increasing demand and dropping cost for wind power should be maintained adequately in order to maintain the equilibrium in the market.
Via: Economic Times