Wind turbine maker Vestas sees U.S. demand peaking in 2020 as government incentives, which have spurred investments in the sector, are phased out.
The Danish company is the turbine maker most exposed to the U.S. market, where it competes with General Electric and Siemens Gamesa.
Strong interest from utilities looking to replace retiring coal assets and big companies looking to buy renewable power will ensure U.S. demand does not fall off a cliff, as some analysts have predicted, Vestas' North American chief said.
“There’s no such thing as a cliff,” Chris Brown said at the firm’s capital markets day on Nov. 29.
“I think that 2020 is going to be the peak of where the demand is and you're going to see it fall off a little bit as you lose the PTC [production tax credit]. And then you’re probably going to see it come back,” he later told Reuters.
The PTC scheme has been critical to enabling wind projects to compete with fossil fuel plants but will start being gradually phased out from 2020.
Brown pointed to 22 gigawatts (GW) of unmet demand by 2030 from so-called RE100 companies, which is an alliance of firms including Goldman Sachs, Walmart and Starbucks that aims to get 100 percent of electricity from renewable sources to combat climate change.
Another 11 GW of unmet demand comes from utilities across the United States looking to replace coal plants with new wind generation, Brown added.
Recommended Reading
Shipping Traffic Freezes Up in Port Waters After Baltimore Bridge Collapse
2024-03-26 - U.S. port of Baltimore traffic was suspended until further notice following a bridge collapse. At least 13 vessels expected to load coal were anchored near the port at the time of the incident.
Segrist: The LNG Pause and a Big, Dumb Question
2024-04-25 - In trying to understand the White House’s decision to pause LNG export permits and wondering if it’s just a red herring, one big, dumb question must be asked.
Permian Gas Finds Another Way to Asia
2024-04-30 - A crop of Mexican LNG facilities in development will connect U.S. producers to high-demand markets while avoiding the Panama Canal.
Exclusive: Chevron Balancing Low Carbon Intensity, Global Oil, Gas Needs
2024-03-28 - Colin Parfitt, president of midstream at Chevron, discusses how the company continues to grow its traditional oil and gas business while focusing on growing its new energies production, in this Hart Energy Exclusive interview.
Midstream Builds in a Bearish Market
2024-03-11 - Midstream companies are sticking to long term plans for an expanded customer base, despite low gas prices, high storage levels and an uncertain political LNG future.