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FORIMMEDIATERELEASETuesday6March2012

EthanZindler

+12024163466

bnefmedia@bloomberg.com

OVERCAPACITYANDNEWPLAYERSKEEPWINDTURBINEPRICESINTHEDOLDRUMSTheaveragepriceforutilityscalewindequipmenthitanothernewlowinthesecondhalfof2011,

dipping4%becauseofexcesscapacityandnewlowcostcompetitors,reportstheBloombergNew

EnergyFinanceWindTurbinePriceIndex(WTPI)

LondonandNewYorkThelatesteditionoftheWindTurbinePriceIndex(WTPI)fromBloombergNew

EnergyFinance,theleadingfirmforcleanenergyanalysis,showsthatcontractssignedinthesecondhalf

of2011for2013deliveryfelltoEUR0.91m/MW($1.21/MW),down4%fromsixmonthsearlierandwell

offtheirfiveyearhighofEUR1.21m/MWin2009.

PricesdroppedmostsharplyforolderturbinestoEUR0.85m($1.13m)permegawattonaverage,down

10%fromsixmonthsearlier.Newerwindturbinemodelsaremoreefficientandofferimprovedcapacity

factors. However,analysisofcontractscoveredbytheWindTurbinePriceIndex(WTPI)foundthateven

thenewmodelshaveseenpricescomingdown.

Thesixth issueoftheWTPIshowsprices falling inthesecondhalfof2011 inallpartsoftheworldas

Chinesemanufacturerscompetedstronglyfororders,even indevelopingmarketssuchasBrazil,Chile,

Ecuador, Pakistan, Ethiopia and Australia. The survey revealed procurement officers and turbine

manufacturessharingagenerallynegativeoutlookonprices;mostanticipatefurthermoderatedeclines

in

turbine

prices

in

2012

and

2013.

They

dont

expect

prices

to

recover

until

at

least

2014.

Onesignificantsilver lining inthe latestresultsoftheWTPI isthat lowerequipmentpricesmakewind

more competitive with fossilfuelled forms of generation. Michael Liebreich, chief executive of

Bloomberg New Energy Finance, commented: Shortterm pain among wind manufacturers is now

undeniableandunavoidable.Butthecurrentpriceslump isgoodnewsonthedemandsideaswind is

morecompetitivewithcoalandgasonadollarpermegawatthourbasis,whichisvitalgiveneverlower

levelsofsubsidyandsupport.Thosemanufacturerswhichcanachieve leadingcostpositionsaregoing

tobeinagoodstrategicpositionwhenthemarketentersitsnextexpansionaryphaseinafewyears.

BloombergNewEnergyFinancesanalysishaspreviously shown thatpowergeneratedby theworlds

bestnewwindfarmscanachievecostsof6.5UScentsperkWh,comparedwiththesameperkWhfor

coalfired

power

stations.

By

2016

the

firm

expects

the

median

new

wind

farm

worldwide

to

be

competitivewithcoalbasedpowerwithnosubsidies.

TheWTPI representsaggregateddatacollectedonaconfidentialbasis from38of theworlds largest

buyersofwindturbines.Thesample includes informationonmorethan230turbinecontractstotaling

nearly10.6GWofcontractedcapacitywithamainfocusonEuropeandtheAmericas. Participantsin

the survey andBloombergNew Energy Finance Insight clients receivemore indepth informationon

howpricesdifferbetweenregions,turbinemodelsandmanufacturers.TheWTPIisupdatedbiannually

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andBloombergNewEnergyFinancewelcomesadditionalparticipants.Interestedpartiesshouldcontact

EduardoTabbushatetabbush@bloomberg.net.

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