Germany

Germany

Analysis: Areva Wind waits for Wikinger decision

GERMANY: Negotiations are ongoing between Iberdrola and Areva over the turbine supply deal for the 350MW Wikinger project, according to the French manufacturer.

Areva's 8MW turbine forms a major element of the company's strategy
Areva's 8MW turbine forms a major element of the company's strategy

In the current quiet period for offshore wind, the Wikinger contract would help buoy up Areva's renewables division.

Areva reported that earnings before interest, tax, depreciation and amortisation (Ebitda), operating income and operating cash flow before tax in its renewable energy business group were all negative in first half results for 2014, as they had been in H1 2013. It was unable to reveal details for the first nine months of 2014.

On the positive side, a precondition for the Wikinger final investment decision is met through the grid allocation, a spokesman for Iberdrola Offshore Deutschland told Windpower Offshore, adding that negotiations are continuing. The project is due to come online in 2017.

Areva Wind's Bremerhaven factory awaits a new contract. It is currently idle after installation of the 80 5MW turbines at the Global Tech 1 wind farm was completed on 29 August.

A second potential project, the 400MW MEG 1 in the North Sea, has been delayed by market and investment insecurities — project developer Windreich is insolvent. But MEG 1 has already secured its grid allocation and Areva said it is "willing and ready to support the project and its stakeholders depending on project progress".

In the longer term future, the Areva 8MW turbine (to be developed with Gamesa) will be manufactured at the current manufacturing site in Bremerhaven, as well as the planned sites in Le Havre and in the UK. An Areva spokeswoman stressed the 8MW is a cornerstone of its company strategy together with the final portfolio of the Areva-Gamesa joint venture.

Areva has not commented on the effective exclusion of the Bremerhaven plant from delivering to French offshore projects such as the Le Treport (500MW) and Yea and Norimoutier islands (500MW) announced by Areva on 7 May.

In the section on "impact of industrial activities" in the French government's tendering text, a scoring mechanism is used that is "designed to enhance the choice of location and logistics processes that allows minimisation of pollution and risks induced by operations transport." In short, if it is manufactured in France then its more sustainable.

For its part, Areva has stressed that the industrial strategy for the upcoming offshore projects is based on manufacturing sites close to the offshore projects. It said the German and French teams have cooperated closely on the industrial development of Areva's planned offshore wind facility in Le Havre. The upcoming Joint Venture with Gamesa, expected to be closed Q4, will further enhance the international positioning, Areva Wind said.

Moreover, Areva is still assessing potential onshore installation sites for the 8MW onshore prototype. "Several locations are being considered in France, UK and Germany but the final decision has not been taken yet," Areva Wind said.

In its nine-month results, Areva reported a 14.3% slump in group revenue to EUR 5.6 billion in the first nine months of 2014 compared with the same period of 2013. Renewables made a tiny contribution of EUR 43 million, a 16.1% slide from EUR 51 million in the first nine months of 2013. The renewables order backlog stood at just EUR 31 million at the end of September 2014 "in line with execution of existing contracts and the absence of significant new orders".

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