Tao Gang: “Going out” is where China’s wind power exits

On February 7, the global wind energy council released the latest statistics, showing that in 2011 China's wind power installed capacity accounted for 44% of the global new capacity, at the same time, 62GW of cumulative installed capacity also ranked first in the world.

Although China has become the world’s “double crown” in the field of wind power, last year the domestic wind power industry and enterprises gradually fell into a state of slump, and the industry’s overall overcapacity and profit decline are particularly prominent. In 2011, China’s macro regulation and control continued to tighten, which adversely affected the development speed and cash flow of downstream wind farm developers. Pressure was also transmitted to upstream equipment manufacturers.

As one of the leading wind power companies in China, Sinovel Wind Power also faces the problem of how to “break”. In a recent interview with a reporter from the China Science Journal, Tao Gang, senior vice president of Sinovel Wind Power, said: “In the current environment, I believe that Chinese wind power companies should not only 'go global', but also 'go global'. Only in the international market We must stand firm to ensure sustained, healthy development and not be eliminated by the market.”

Industry down sign industry matured In the early 2011 performance forecast of 29 wind power companies released in early February, only 11 companies showed a pre-increase in performance, and 17 showed a decrease in advance. The overall sector of the industry declined significantly. According to the announcement from Sinovel Wind Power, the company's 2010 profit was 2.856 billion yuan, and it is expected that the performance in 2011 will fall by more than 50%.

In this regard, Tao Gang said that last year, China's wind power industry has become increasingly competitive, which has a direct impact on the overall profitability of the wind power industry. The overall reduction in product prices of wind power equipment industry has adversely affected the market share, sales revenue and gross profit margin of Sinovel Wind. .

For the general decline in the growth rate of the wind power industry in 2011, Tao Gang believes that this is a normal return of the wind power industry after rapid development in the past five years, and a sign that China's wind power industry has gradually entered a mature period.

“I think that in the future, the wind power industry will face adjustments and further regulations. In the future, it will lead to a healthier and sustainable development. The introduction of a series of related policies proves that the state’s efforts in regulating the wind power industry are increasing.”

Tao Gang pointed out that in the future, China's wind power industry will enter the industry consolidation period under the role of the market, which is also the only way for the domestic wind power industry to become stronger and stronger. At the same time, the construction of the national smart grid and the completion of the low-voltage traversing transformation will greatly increase the grid connection of wind power.

Adhering to the strategy of “going out” In the current situation where the domestic market is becoming saturated and competition is becoming increasingly fierce, Chinese wind power companies have begun to look overseas. After entering 2011, the number of cases of Chinese wind power companies participating in foreign markets has exceeded the total from 2007 to 2010.

Shi Lishan, deputy director of the New Energy and Renewable Energy Division of the National Energy Administration, publicly stated that it is necessary to consider the production capacity of the domestic wind turbine manufacturing industry in the international market.

Tao Gang told reporters that Sinovel has always been a firm executor of the "going out" strategy.

“Internationalization is the first strategy of Sinovel Wind's “12th Five-Year Plan” and it is expected that our overseas business will occupy a significant position in the total business by 2015.”

As early as 2010, the China Development Bank signed a strategic cooperation agreement with Sinovel Wind Power to provide a sound financial guarantee for Sinovel to expand into the international market. Currently, Sinovel Wind Power has established subsidiaries in the United States, Canada, Spain, Australia, and Brazil.

After entering into 2011, Sinovel Wind Power has signed a number of international business agreements. For example, in June 2011, it signed a procurement contract with Swedish CRC Wind Power Co., Ltd. for the purchase of two 3 MW wind turbines. This is the first time that Chinese wind turbines have entered the Swedish market. In September, Sinovel Wind also signed a contract with Desenvix, a Brazilian local power development company, to provide 23 sets of wind turbines for a 34.5 MW wind farm in Brazil.

When asked about the biggest challenges faced by overseas development, Tao Gang thinks how to “localize” the issue. He pointed out that the natural conditions, policy environment, and legal system of overseas markets are not the same as those of the domestic market. When domestic wind power enterprises develop overseas, they must pay attention to local conditions and strive to overcome “acclimatization” and achieve localization.

Technology leadership is the core competitiveness For a long time, the advantage of cost competition has supported the large number of export of wind turbines in China, but for wind power equipment manufacturing companies, Tao Gang believes that it needs more technical advantages, stable supply chain, and abundant market resources. It is possible to occupy a place in the competition with international wind power companies.

Tao Gang particularly emphasized that technology leadership is the core competitiveness for entering the overseas market. Only by maintaining a technological leadership can he gain an opportunity to expand overseas wind power, and he must also avoid risks and avoid unnecessary patent disputes.

According to reports, Huarui Wind Power gradually fell away from the technological control of foreign companies relying on technological progress and independent innovation, and was recognized by the international technical authority.

On October 20 last year, Sinovel Wind Power won the first certificate of wind turbine A design certification issued by China's wind power equipment manufacturer for Lloyd's Register of Shipping (GL). Recently, Sinovel won once again the wind turbine type certification issued by China Wind Power Equipment Manufacturers.

Currently, Sinovel Power Co., Ltd. has 6MW of large-scale offshore wind turbines with completely independent intellectual property rights. At the end of 2011, it successfully won the bid for Shanghai Lingang Offshore Wind Power Phase 1 demonstration project. This year, Sinovel Wind Power will vigorously develop large-scale wind turbines of 3MW or more, maintain and expand the domestic market share; at the same time, 5MW and 6MW wind turbines have also been produced, and will gradually realize commercial operation.

Looking into the future, Tao Gang said: “We will also take various measures to actively reduce production costs, strictly control expenditures, and continue to explore the international market to cope with the increasingly fierce market competition.”